Canadian Connections

Marshall Sadd (L) and Bruce Rabik (R) were the founding members of the Canadian Broker Network.

Imagine having the ability to disclose financial results and discuss operational issues, marketing and hiring strategies in a trusted environment with like-minded broker owners. This is what the members of the Canadian Broker Network (CBN) have.

Each principal agrees they feel completely at ease disclosing confidential information about their firm without the threat of competition, despite the fact that each firm is a mid-sized, independently owned commercial brokerage. Is it because they’ve all known each other for years and are comfortable with one another? Is it because each appreciates the opportunity to be able to benchmark and bounce ideas off one other? Or is it because no two companies are in direct competition with each other, and instead are divided regionally? Probably all three.

Established in 2002, the CBN came to fruition through the hard work and dedication of Cookson Walker Consulting, as well as several of the founding members: Lloyd Sadd Insurance, Vezina assurances inc., PBL Insurance Ltd., Dan Lawrie Insurance Brokers Ltd., and Rogers Insurance Ltd.

Bruce Rabik, then an associate consultant at Cookson Walker Consulting and today chief operating officer at Rogers Insurance, and Marshall Sadd, president at Lloyd Sadd Insurance, were at the forefront of the idea. Sadd says he remembers his father being part of a similar group—7 + 1 Group, which evolved into Insurance Network Solutions (INS) until most members were sold to Hub International—and how he was always bursting with ideas after meetings. Sadd and Rabik felt they could pool their resources to once again create such a group.

“Bruce wanted to form a national group of brokers that would be a self-help group,” explains Eric Walker, partner at Cookson Walker Consulting. “He asked myself and Steve Frye [partner at Cookson Walker Consulting] for assistance in developing the group.”

The executives found a sample constitution from INS, modified it and used it as a template to develop the CBN. Next they circulated it amongst the brokerages they’d asked to join the group for their input.

“Our goal was to create a group of leading independent commercial lines brokerages across Canada who could share operational and financial information with the goal to improve their operations,” says Walker.

The ability to benchmark information was key, he adds. While public companies can easily get information about other public companies and compare themselves, it’s harder for independent businesses to do so.

CBN holds semi-annual meetings that are facilitated by Cookson Walker Consulting—one in September in Toronto and one in May that rotates location. These meetings were originally for principal owners only, but have since evolved to include separate meetings for CFOs, marketing specialists and sales managers. CBN members also have the benefit of contacting each other at any point during the year to ask questions and get clarification on any business matters.

Every year, a new chairman is elected to lead the next two meetings. This position alternates informally, and in September 2011 will fall to Tim Miller, CFO/COO at Capri Insurance.

Miller says his vision for the next year includes exploring opportunities for closer collaboration between members of the group. He believes there are areas where the group can enhance the competitive position of its members beyond the knowledge sharing and benchmarking they do now.

“It’s important to recognize that we each have our own unique cultures that contribute to our respective value propositions. Given that we compete in the same industry, there are going to be areas of opportunity that we can exploit to deliver better value to our customers.”

While the exact criteria to join the CBN is confidential, there are some basic standards: the brokerage must be independently owned with a succession plan to remain independent, 60% of it’s business must be commercial, and it must produce a minimum $4 million in annual revenues. Currently, the group isn’t planning to expand its membership, and potential members are usually invited to join by one of the founding firms.

All members agree they’ve greatly benefited from the experience of the CBN.

“It’s accomplished what it was set up to accomplish—share good and bad experiences in a confidential and non-threatening setting,” says Sadd. “We’re really here to learn from each other. We’ve taken and provided advice on premium financing, sales management, hiring producers, labour costs, commission structures for producers, acquisition financing—anything and everything that’s applicable to brokers.”

Click here to read about CMW Insurance Services Ltd., Rogers Insurance and Capri Insurance

This story was originally published by Canadian Insurance Top Broker.