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(June-2004) Salon shuts up shop
Increasing regulatory compliance costs have prompted the relatively small superannuation fund for hairdressers and beauty therapists, Salon Super, to merge with the Australian Retirement Fund (ARF).
The NSW-based Salon Super which has 9,000 members and $48 million in funds under management merged into the 550,000 member ARF, taking funds under management to well in excess of $6 billion.
Salon Super deputy chairman John Shields says the decision to merge had its genesis around 12 months ago when it was realised it was facing increasing cost pressures and an inability to generate meaningful economies of scale.
“We’ve been like an undersized David struggling to compete with a market of Goliaths,” he says. “Not being able to beat them, we decided to join them.”
Shields says that the merger followed a tender process following advice provided by Mercer with three funds being listed.
“As a small fund, which offered our members a high level of customer service and empathy, we wanted to transfer into a fund which would take care of our members in the same way we have,” he says. “Having had a strong investment performance in recent years we looked for another high performing fund for our members and we chose ARF.”
He says ARF was able to offer Salon Super members a wide range of investment choices, access to cheap home loans and credit cards, as well as an interactive web site.
“We would never have been able to provide those resources to our members,” Shields says.
He says the trustees of Salon Super have acted selflessly and in the interests of the fund’s members in pursuing the transfer and are confident that ARF will do the same.
AUTHOR
Mike Taylor
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