Parkers - Partners in opportunity

Started in veteran broker Andy Parker's garage in 1991, Parkers has come a long way in 18 years, having quadrupled in size. When Munday joined the broker in 1999, it consisted of two partners and only three people worked full time. Munday was promoted to partner a year later and a fourth partner, Steve King, joined in 2003.

Munday explains: "The idea of having four partners is that Steve Wilson and Andy Parker are in their early 50s, whereas Steve King and myself are younger; they wanted people in place for a smooth succession later on in the life of the business."

Although the ownership of the broker is shared between the four partners, they have not had any major disagreements. Munday believes that this is because the partners were all approached for their roles personally and have defined roles. Each partner has their own area of expertise, for example one of the partners manages the technical side of the business and so is concerned with information technology and accounts among other tasks.

Stratification

The largest change for Parkers recently has been the change in its mix of business, which has evolved to reflect the personal expertise of each partner as they joined. Originally, Andy Parker was willing to take on any business that came through his door from private car to commercial, whereas now the broker has a very strong commercial lines focus. Since Steve King joined the broker in 2003, Parkers has shifted its focus towards professions business; around a third of the broker's business is now professional indemnity. Munday says: "We moved into solicitors PI and went from scratch to £700,000 within two years; among our clients is a national firm of independent financial advisers. Andy also has a PI background but it was very difficult for him to attract this kind of business on his own at the start."

It is not only the partners - all with over 20 years in the insurance sector behind them - that have the benefit of many years experience in the insurance industry. Even the least experienced member of the office came to Parkers with 13 years of knowledge behind them. The broker has not been untouched by the recession, with several larger construction clients going under over the winter, however, Munday believes the experience of all the staff puts Parkers in a strong position to weather the storm. The much-mooted hardening market should help navigate the broker through turbulent times.

A wide mix of clients has also put Parkers in a solid position. The expertise of the four partners means that they are not frightened to place unusual business and many of these niche clients continue to grow. Clients include a Cornwall-based seafood seller that was previously selling only in Europe but is now selling specialist products to the South-east Asia.

In 2003, Parkers bought Taunton-based broker Michael Lemon & Company and the broker has been on the search for more mergers and acquisitions. Munday says that recessionary pressure on the consolidators may help Parkers make acquisitions. He comments: "Pricing has made acquisitions difficult because the consolidators have been willing to pay over the odds. Prices are coming down as the consolidators have slowed their acquisition rates and are they becoming more affordable for the likes of us."

During his time at Leslie & Godwin - which was purchased by Aon in the early 1990s - and then Walker Person and Partners (which bought its business back from Aon in 1995), Munday has had to manage the transfer and handling of several different books of business. He remarks: "On three or four occasions, I have taken over considerable books of business and most clients stayed for years, so I had some degree of success. As I had been through it before, this made it easier when taking other Michael Lemon's clients. He only stayed with Parkers for two years after we acquired his business."

Munday first moved into broking in 1987 at Kent-based broker Sharrocks after seven years at Cornhill. After working for the broker for only three months and at the age of only 23, he was asked to cover for the manager of the Sittingbourne office, a role that was soon made permanent when the incumbent left. At such a young age and without any management training, Munday understandably reflects on the period as a "nightmare", though one that he believes put him in good stead for the future.

"Ever since (having to take charge), I have never been scared to ask a difficult question and I know how important attention to detail is," says Munday. He continues: "We are all so stretched in this business that many can be tempted to rush business through but attention to detail is vital. You can make a big difference to clients by paying attention to their real needs rather than just selling them insurance."

Big changes

Parkers joined Jelf Group's Purple Partnership on 1 January this year in order to maintain strong relationships with insurers that were looking for larger accounts and not doing much business with the broker. Munday explains: "We buy insurance for our clients rather than being a salesman, so it was important for us to maintain agencies with as many insurers as possible in order to offer our clients choice. We chose the Purple Partnership because it is the network through which we had to give up the least; things such as central accounting and software are optional. We spoke to the bigger boys (larger networks) that would have had a greater effect on our bottom line but were keen to maintain our independence."

It is still early days, though Munday has already noticed a difference in the attitude of some insurers. For example, Parkers has been reintroduced to RSA's office in Bristol, which they had not been able to deal with for seven years because Parkers was deemed too small.

The importance of the network has also been accentuated by the decision of NIG to shut its Exeter office. Munday believes that, prior to joining the Purple Partnership, this would have had a large effect on Parkers. He comments: "We have traditionally supported insurers with local offices but, now we are members of Purple, we are mostly dealing with Bristol offices now. However, the level of service from NIG's Bristol office must match that which we have been receiving from its Exeter office if there is not to be a deterioration in our relationship."

With these renewed insurer relationships now firmly in place through the Purple Partnership, Parkers is free to continue its ambition to grow through acquisitions, mergers and organic growth. Munday says: "The market has changed. Some clients are suffering but there are still strong opportunities to grow both organically and through further acquisitions. It has become almost impossible for the larger brokers to keep many local offices, which offers opportunities for us to step in where they have left gaps."

PARKERS INSURANCE BROKERS

Partner: David Munday

Established: 1991

Location: Thorverton (Exeter)

Number of staff: 8

Main line of business: Commercial

Gross written premium: £3m.