For Zadnik and his brokerage, Hawthorn Finance, business lending continues to be about long-term, reliable service and relationships
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DANIEL ZADNIK is an established fixture in the Top 10, and indeed the entire commercial finance world. Melbourne-based Hawthorn Finance – part of the national Bentleys Group – was established in 2008, but prior to that Zadnik had been at ANZ for 18 years in business banking. His success is built on this considerable experience and permanence in this market.
It’s something that Zadnik is acutely aware of. “The biggest selling point we have as an owner of a business is that we tell the clients that they will have a long-term relationship with us and they don’t have to keep educating the next relationship manager at the bank.” There’s been no change in service provision: the brokerage continues to offer commercial finance, asset finance and residential lending, and the client base continues to be small businesses. “I don’t think [these] clients really shop around for commercial brokers,” says Zadnik. “I think if they meet you and are happy with the expertise you bring to the table they will engage your services.”
Zadnik has a considerable advantage when it comes to getting clients. The Bentleys Group is a network of independent accounting and advice firms across Australia. It has recently expanded into Brisbane, which Zadnik sees as a good growth market. Bentleys covers a vast range of industries: Zadnik mentions property, manufacturing, agriculture, professional services, hotels, pharmaceutical, real estate, “just to name a few”.
Bentleys heavily promotes Zadnik and the broking side of the business, providing a stream of referrals. These referral relationships work both ways. Having the network in place means, as Zadnik puts it, “we have all bases covered”, allowing him to refer to specialists in accounting, taxation, superannuation, audit and financial planning.
This flexibility is essential. Zadnik offers almost all types of finance, including residential home loans, which he says are “complementary to commercial loans as the majority of business owners have home loans and investment loans”. Covering all bases, however, has meant that Zadnik has been hit by changing lender appetites in the property development space: his volumes dropped by $40m from 2015. The problem is credit, he argues. “It has been significantly harder to get funding in 2016, particularly property development as the banks have really tightened up in this segment.”
It is possible that this turbulence could end up being to Zadnik’s benefit. Hawthorn Finance’s target client would traditionally have dealt with a local business banker, and many continue to do so, according to Zadnik. “My experience is if they don’t engage you then they are generally happy dealing with their bank directly.” If those clients fi nd themselves unable to obtain credit from their bank of choice – or feel let down by the long delays in decision-making and lack of transparency regarding those decisions – they may join their counterparts in seeking out brokers like Zadnik, to give them more confidence and a choice of options.
Those clients will be looking for the reputation and stability which they had previously associated with their bank – attributes that make Zadnik, Hawthorn and Bentleys well suited to fill that vacuum.
