The Transformation Behind Brokerage Branch Consolidation: A Migration from Scale to Value

As an important driver of wealth management transformation and a key window for connecting investors, the number of brokerage branch offices has generally declined over the past five years, reflecting a shift in the functional positioning of physical outlets.

Sources say that brokerages are continuously advancing the optimization and upgrading of customer service and branch layouts. The profit model of business departments has shifted from traditional commission income to wealth management; operationally, a division of labor and collaboration pattern has formed with “online expansion and offline deepening,” creating a virtuous cycle where online customer acquisition and offline operations mutually promote each other.

From “scale expansion” to “value cultivation,” the transformation of physical outlets reflects the deep changes in China’s securities industry driven by both the digital wave and wealth management demands.

Changes in Functional Positioning

As the construction of brokerages’ business departments enters a deep transformation phase focused on “quality first and efficiency-oriented,” the role of physical outlets is being redefined.

Over the past five years, branch contraction has become the main trend. According to a sample of 62 securities firms with more than 50 branches each, selected by Securities Times reporters, since 2020, 18 brokerages have reduced their branch count by more than 20. Among them, Guotou Securities saw the largest reduction, decreasing by 101 branches to 225 over five years; Guosheng Securities reduced by 57 to 139, nearly halving from its peak of 244 in 2017; Everbright Securities, Guoxin Securities, and Hualin Securities also each reduced by over 40 branches.

Correspondingly, only 11 brokerages in the sample maintained moderate expansion, while 16 remained relatively stable, with changes in branch numbers within five.

Behind these changes in numbers is a profound transformation in the functional positioning of physical outlets. A representative from Galaxy Securities said that many brokerages are pushing branches to evolve from “transaction terminals” to “wealth management hubs,” shifting their role from “business processing” to “value creation,” serving as a strong complement to online services and platforms for in-depth client engagement.

“We believe it’s still necessary to give offline outlets more connotations and innovative scenarios. In the future, on one hand, branches will serve as a platform to showcase the company’s brand image; on the other hand, they will gradually transform from functional spaces mainly for business handling to scenario-based spaces that ‘intersect with clients offline and further build trust,’” said the Galaxy Securities representative.

Similarly, Zhongtai Securities noted that the “first increase and then decrease” trend in branch numbers is an inevitable shift as the securities industry transitions from traditional brokerage channels to modern wealth management institutions. As core wealth management services shift focus to asset allocation, professional investment advisory, and high-net-worth client services, brokerages will gradually concentrate resources on flagship branches and other key outlets.

Regarding the new positioning of physical outlets, a representative from CICC Wealth said that branches serve as the company’s nationwide network hubs and front-line touchpoints, acting as the employees’ workplace, the client communication center, and the client activity hub. They also serve as local brand and product display centers, visually and vividly presenting the company’s diversified products and services to clients.

A representative from Kaiyuan Securities mentioned that physical outlets are “community wealth lifestyle managers” and “financial health stations” close to clients and frontline touchpoints, as well as “terminal carriers” of wealth management transformation, directly responsible for tiered client services and demand feedback.

Online for Breadth, Offline for Depth

As online trading platforms become increasingly sophisticated and customer behavior accelerates toward digital channels, questions about “whether offline services will be replaced” and “how online can empower offline” have become industry topics. According to Securities Times reporters, “online for breadth, offline for depth” has become a consensus in the industry.

A representative from CICC Wealth said the company is building an integrated online and offline user operation and service system, leveraging multiple online channels to reach potential clients, conducting layered operations throughout the client lifecycle to enhance user value, and incubating high-value clients through internet-based business departments, creating a virtuous cycle of online customer acquisition and management. For long-tail clients, the company uses intelligent layered operations to boost engagement and asset conversion, consolidating manageable client groups, and providing intensive services via “airborne branches,” incubating high-value clients and directing them to offline channels for in-depth one-on-one services by wealth advisors, thereby expanding client assets and fostering long-term growth.

In November last year, Galaxy Securities established a Beijing Internet Securities branch to reconstruct the online customer acquisition and online-offline collaboration model. The company uses investor education content as a key approach, continuously delivering on public platforms to enhance wealth management branding and influence; it connects “online promotion—offline engagement—full-cycle service” into a closed loop; and relies on intelligent middle platforms to achieve more refined client profiling and more precise financial services. Industry insiders believe that offline efforts focus more on personalized financial services and complex business implementation, while online efforts target large-scale retail client outreach and standardized services, building a collaborative ecosystem of “convenient online access and close offline proximity.”

Guohai Securities’ practice emphasizes digital tools empowering frontline staff. The company has built a digital operation system centered on a “data middle platform + digital staff activity operation platform,” using an intelligent operation engine to gain insights into client needs, enabling “real-time intelligent online strategy triggers and real-time offline strategy coordination.” The core of online empowerment for offline services is “tool deployment and capability uplift,” embedding intelligent engines into business processes and equipping frontline staff with digital tools, transforming branches from traditional transaction counters into more professional and warm “wealth management advisory centers.”

Clear Shift in Branch Evaluation Focus

As the role of branches shifts from “transaction channels” to “wealth management service centers,” evaluation criteria also change accordingly. Many interviewees noted that the industry now pays more attention to value-oriented indicators such as asset retention, investment advisory capabilities, and customer stickiness.

A representative from Galaxy Securities told us that the company has developed three main approaches: first, translating the “five major articles” of finance into actionable business guidelines, such as strengthening the assessment of equity and index fund holdings to promote index investing as a way to practice inclusive finance; enhancing assessments of personal pension account openings and retirement financial product sales to guide branches in providing retirement planning solutions; second, continuously strengthening evaluations of investment advisory and asset allocation indicators; third, encouraging branches to develop differentiated and specialized growth paths based on regional resource endowments, building core competitiveness in niche areas.

A representative from Guohai Securities said the company focuses on client development and management, emphasizing service innovation and quality improvement, and advancing wealth management transformation. It continues to increase the weight of financial product holdings in assessments, and incorporates long-term investment returns, investor education, complaint management, and intelligent employee services into evaluation metrics.

A representative from Kaiyuan Securities also mentioned that the company conducts differentiated assessments based on each branch’s strengths, de-emphasizing traditional trading metrics and emphasizing asset allocation and client loyalty as key value indicators.

Layout: Luo Xiaoxia

Proofreading: Pan Dà