Every business, regardless of size or sector has one thing in common – that is the need to effectively manage the relationship with their bank.
Banks have been heavily criticised in recent years over mis-selling scandals and an apparent reluctance to lend to small businesses. However following conversations that we at Tectona have had with numerous bank relationship managers on the front line, we are convinced that most banks are committed to building mutually beneficial relationships with their clients.
Demand more than money
Alongside your accountant and solicitor, your bank manager is a key stakeholder within your business, able to not only provide financial support but also offer added value by way of introductions to other professionals and potential customers.
Whilst owners should expect a proactive approach from their bank manager, those looking to extract maximum value from their relationship with the bank should be proactive themselves when seeking more than financial support from the bank. Successful bank managers tend to be very well connected, and many are more than happy to arrange introductions between clients and contacts where they feel there would be a benefit in doing so.
It’s not only introductions on a personal level that business owners can now come to expect from their bank manager; networking events, seminars and workshops are now commonly offered by banks looking to add additional value to their clients, and you should expect your bank manager to invite you to events which would benefit you or your wider team.
Many banks are also embracing technology and social media offering additional value services through their online platforms. For example, Barclays has recently launched ‘Barclays Connector’, an online business community allowing you to build a network, share information, bid for work or offer services.
A partnership approach
One London based business relationship manager we spoke to described this ‘added value’ piece as one of the most important parts of their role. If a relationship manager can add value in addition to what is traditionally expected from them, their clients will add them to their list of ‘trusted advisors’. With banks looking for ways to differentiate themselves from the competition, this type of approach to the relationship should be demanded by the business owner.
By displaying ‘trusted advisor’ behaviours, banks will be able to position themselves as partners, working to support the growth of a business as opposed to simply offering transactional services. This should involve the delivery of exceptional customer service, prompt turnaround of questions and queries and a consultative approach, seeking to fully understand your business by continually asking open questions, and using their experience to challenge your forecasts and strategies in order to help make your business better.
Although regularly seen as simply providers of funding, there are a plethora of other benefits that a proactive, challenging bank manager can add to a business, and by taking the time to build a mutually beneficial relationship, you as a business owner can take advantage of the significant added value that a bank manager can provide.
To find out how to extract maximum value from your bank relationship, or if you would like to discuss any of the topics covered above further, please contact us through the Tectona website or call Mark Nicholls on 07818 407061.