Attracting Small Business Clients at the Branch Level
As banks and credit unions continue to focus on deposit growth, one area that has significant potential for growth is attracting and retaining local small businesses. The challenge, however, lies in more than mere attraction—it's about understanding, customizing, and innovating services to meet the unique needs of these enterprises. This article will explore how banks, credit unions, and other financial institutions can more effectively cater their services to small businesses so they can improve the attraction and retention of these meaningful clients.
Understanding the Needs of Small Businesses
The process starts with an analysis of the institution's existing small business offerings and strategies. This includes an assessment of whether current programs meet the needs of today's small businesses, as those needs have changed drastically.
Post-Pandemic Evolution of Needs
Small businesses have undergone a transformation post-pandemic. The agility and resilience they have demonstrated through such trying times call for financial partners who can keep pace with their adaptability.
Clearing the fog of uncertainty, these businesses have refocused on growth, efficiency, and often digitalization. Banks can rise to the occasion by offering tailored financial products that aid in recovery, such as flexible credit lines and digitally streamlined services.
The Local Branch Advantage
Small, local branches are still a critical resource for small businesses, even if most consumer banking customers have turned to digital. The hometown bank narrative is still strong and is an essential draw for local enterprises that value interpersonal relationships and the reliability of a physical presence.
Understanding that local branches are often seen as an extension of their business, banks can position their services to emulate the support and familiarity small business owners seek.
Employee Training and Client Relationship Building
Beyond the institution's programs and products, employees also need to be educated on how to approach and manage small business clients.
Strategic Counselors, Not Just Service Providers
Employees should be equipped not only with financial acumen but also with the nuances of being a strategic business counselor. Training programs should focus on imparting knowledge of current market trends, business operations, and the understanding that every small business has a unique story and set of needs.
This shift from provider to partner is pivotal in cementing long-term relationships with small business clients.
The Loyalty-Building Nature of Relationships
The service industry thrives on relationships. For small businesses, loyalty is often earned through the recognition of their individuality and the provision of tailored services.
By fostering relationships that go beyond transactions, banks can secure a loyal client base and, consequently, attract new clients through word-of-mouth referrals from satisfied small businesses.
Tailoring Services and Perks for Small Businesses
Most small businesses rely on their financial institutions to provide them with meaningful perks and services. Banks and credit unions would do well to assess what perks they currently offer, and then take steps to innovate based on current market conditions.
The Perks that Matter
Understanding small business owners' daily challenges can inform a bank's approach to services and perks. Time is often the most valuable commodity for entrepreneurs, so services that save time, such as expedited loan approvals or remote deposit capture, can drive significant interest.
Similarly, perks like fee waivers and rewards programs for business-related expenses demonstrate an understanding of their unique financial pressures. Other perks, such as educational seminars and networking events, can also be valuable resources for small businesses looking to grow.
Financial Innovation That Stands Out
The race for small business clients is also a race to innovate. From user-friendly mobile apps facilitating quick transactions to sophisticated analytics that provide insights into financial planning and forecasting, technology plays a pivotal role.
Any advancement that simplifies or enhances the financial management of a small business will not only retain current clients but also attract new ones.
Transforming Branches into Small Business Hubs
Banks, credit unions, and other financial institutions can also make changes at the branch level to better service existing small business clients and attract new ones. The key is viewing the bank branch not as a location for business transactions but as a community hub where entrepreneurs can network, innovate, and educate themselves.
Physical Changes at the Branch Level
A branch's physical space can be an untapped resource for business engagement. Creating spaces within branches that are conducive to business discussions—be it a conference room or a quiet corner with appropriate tools—demonstrates a commitment to being an integral part of a small business's ecosystem.
Other perks, such as cafes and coffee shops, could also attract both entrepreneurs and employees. Even changes to the physical layout of the branch can make the branch more of a destination than a sales space.
For example, most people expect to see tellers with long lines when they enter a bank or credit union. Adding spaces for seating, empowering employees with handheld devices, and putting communal spaces at the forefront can significantly change the branch's day-to-day dynamic in favor of small business owners and entrepreneurs.
Events That Create A Buzz
Finally, branches can serve as community centers by hosting events like small business workshops, networking sessions, and even pop-up markets. This multifunctional use of a bank space not only engages current clients but also provides an inviting atmosphere for prospective businesses, showcasing the bank's wider role in community development.
Make Your Branch Central to the Local Economy
Small businesses are more than just clients for banks; they are part of the tapestry that weaves the local economy. The potential for growth through improved services cannot be overstated.
By understanding the needs of these enterprises, training employees to build relationships, tailoring services, and transforming branch spaces, banks can position themselves not just as financial institutions but as partners in the success of local businesses.
To learn more about how your institution can attract more small business clients, don't miss Future Branches 2024. It's happening from June 24 - 25 at the Westin Copley Place in Boston, Massachusetts.
Download the agenda and register for the event today.