Fundsters' intermediary-focused sales teams are shrinking, especially in one area, according to new research from the folks at an industry consulting firm near Boston.

Yesterday (December 18), Loren Fox, director of research at Fuse Research Network, unveiled findings from the Needham, Massachusetts-based firm's new Sales Management 2025 report. That report (which was released on Monday, i.e. December 15) draws on a survey of sales leaders at firms with a combined $2.5 trillion in ETF and mutual fund assets.

On average, asset managers in 2025 have 52 wholesalers in total, the Fuse team finds, which is an 11-percent drop from the 58.4 average of the past five years (2020 through 2024). (By comparison, Fox tells MFWire that fundsters' marketing and national accounts teams grew this year compared with the prior five, while product teams also shrank.)

All three pieces of wholesaling teams are shrinking. This year, the average fund firm has 27.2 external wholesalers, down 7.8 percent from the average over the past five years. The average firm has 21.1 internal wholesalers this year down 14.9 percent from the average over the past five years. And the average firm has 3.6 hybrid wholesalers, down 12.2 percent from the average over the past five years.

"Shifts in the distribution landscape explain this overall decline. Asset managers' tighter focus on profit margins has led to caution about increasing frontline sales staff, which has been getting more expensive," Fox writes in an email. "And with home offices and models playing larger roles, firms have been emphasizing growth among National Accounts staff in recent years. While industry-average numbers have slipped, individual firms are still adding wholesalers for specific initiatives, such as pursuing the RIA channel."

Fox also confirms that external wholesaler counts in 2025 were down "across all firm sizes" when compared with the average of 2020 through 2024.

Yet the picture changes when looking at the changes from 2024 to 2025. Internal headcounts fell 10 percent year-over-year, while hybrids only fell by 1 percent and externals held steady.

"Some firms are making do with fewer internal wholesalers. These are support roles where it's easier to have one internal helping two externals without noticeable impact on interactions with advisors," Fox writes. "Firms looking to manage their expenses are more hesitant to allow external wholesaler headcount to decline significantly because they worry about hurting relationships with advisors."

Yet these declines may reverse a bit in the near-term, in light of markets boosting fundsters' AUM this year, Fox predicts.

"Looking ahead, firms overwhelmingly intend to preserve or increase headcount over the next 12 months for external, internal and hybrid wholesalers," Fox states. "And many firms are positioning themselves to push into new channels (especially RIAs) and expand their efforts with newer product structures (especially ETFs)."

"FUSE finds that advisors prefer dealing with one main contact person at each asset manager," Fox writes. "So, as asset managers expand the types of product vehicles they offer (adding ETFs, separately managed accounts, etc.), they have been more likely to add investment specialists to supplement the support provided by external wholesalers, and less likely to add more wholesalers." 

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