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How Do I Become an External Wholesaler?

Becoming an external wholesaler requires a blend of education, experience, and networking. Start with a degree in finance or business, gain sales experience, and build relationships within the industry. Are you ready to take the next step in your career and explore the world of external wholesaling?
K. Kinsella
K. Kinsella

An external wholesaler is a sales representative employed by an investment firm who is tasked with persuading licensed agents to sell the firm's products and services. Someone wishing to become an external wholesaler must pass obtain a securities license and anyone applying for one of these roles must have gained some prior sales related experience. Most firms also require wholesalers to have a broad knowledge of the securities industry.

Wholesalers usually market either mutual funds or life insurance products. In most countries, people must attend securities training classes and pass a licensing examination before being able to sell mutual funds. Additionally, laws in some countries require insurance sales agents to attend a separate life insurance training course which culminates with an examination. Typically, investment firms require anyone who wishes to become an external wholesaler to have obtained both a securities and an insurance license even if the representative only sells one of these product types because many firms sell hybrid products that contain both securities and insurance elements.

Man with hands on his hips
Man with hands on his hips

From a legal perspective, anyone who passes the licensing examinations can become an external wholesaler even if he or she never graduated from high school or college. Nevertheless, many investment firms prefer to hire individuals who have completed college degree programs in finance, economics or related topics. Some securities firms organize college fairs on the campuses of major universities during which graduates are recruited for these sales jobs. When compared with other finance related jobs, wholesalers are relatively well compensated which means that competition for these jobs is often intense. Therefore, someone wishing to become an external wholesaler must have above average college grades.

Aside from having a knowledge of securities and finance, wholesalers receive the bulk of their compensation in the form of commission which means that people employed in these roles must have strong sales skills. Typically, financial firms require applicants for these roles to have prior experience working as customer-facing investment representatives since people employed in these positions have a good understanding of the kinds of products and features that investment clients typically seek out. Additionally, investment representatives are used to working in a high intensity sales environment which is similar in nature to the environment within which a wholesaler must operate.

In most instances, wholesalers work with agents employed by several investment firms who work within a large geographic area. Therefore, most firms only employ wholesalers who possess drivers licenses since travel is an essential component of the job. Additionally, people employed in these roles have minimal daily interaction with their managers which means that investment firms reserve these roles for self-motivated people who have good organizational skills.

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