How to Build a Better Relationship with Your Bank
Owners of small and mid-size businesses understand that selecting the right banking institution is a key component to their business's financial health. And, as with any relationship, building on a strong foundation will lead to long-term success.
Don't be a stranger. When it comes to building a better relationship with your bank, first remember the adage "don't be a stranger." Especially with very large banking institutions, small and mid-size business owners can all too often become just an account number. While most banking can be conducted online these days, it’s important to physically visit your bank and establish relationships with bank managers, loan officers, and staff. These people can become your company's champions, and they are much more likely to do so if they can put a face to a name. For this reason alone, smaller banks can often be a better fit for SMBs.
Clearly articulate your business plan. Along the same lines, the better the bank knows you and your business, the better off everyone will be. Make sure that your bank understands your business plan, as well as the special concerns and requirements of your industry. As you go along, it's also very important to keep the team apprised of any changes in your plans. They can then effectively guide you in making the best decisions to ensure your company's ongoing financial health.
Set and share your goals. As a business owner, you’re planning for growth, and your banking team can help position your company so that these goals can be met. For example, if you decide to move from accepting cash only to accepting credit and debit cards, your bank can assist you in determining the best merchant services provider for your company. Even better, some banks can provide these services themselves, consolidating accounting and expediting the time it takes for payments to be deposited into your business accounts.
Be honest and proactive. The economy is starting to recover, but companies have faced some very tough situations in the past few years, and some are still recovering. As a financial partner, your bank is there -- and positioned -- to help you through good times and, if they should occur, not-so-good times. The key is not to wait. Inform your banking team immediately of any issues that may arise, and be clear and comprehensive when articulating the circumstances.
Work to build a solid financial history. Your relationship with your bank is a two-way street. Small and mid-size businesses depend on the support and backing of their banking institutions, and banking institutions depend on their customers to make deposits and timely loan payments, as well as consider new and upgraded products. Demonstrating your financial fitness over time -- as well as evaluating services provided by the bank when you’re looking to grow your business and/or add features such as direct deposit for your employees -- will go a long way toward ensuring that your relationship with your bank is fruitful now and in the future.
