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Building better bank relationships in 2016

Sam La

Does your banker wake up every morning thinking about you and your business?  Do any of your suppliers and partners?  Is your banker a true advocate of your business?
I am, from time to time, asked to intervene in bank relationships that are not working.  There are some common symptoms that I find in these situations:
a) The client has not confidently and competently conveyed the exciting future that lies ahead for the business, and
b) The client relies on the banker to build the relationship - the bank makes the appointments for the sporadic catch-ups, the bank makes requests for information when it hasn't heard anything for a while, and the bank invites the client to the footy.
For businesses with a dependency on bank capital, you can't leave the relationship to the banker.  It will never work.  These poor business professionals often have hundreds of clients to look after.  They are lucky to have the time to introduce themselves to you let alone know your business well enough to advocate your business inside the bank.  
It’s time to take the "bull by the horns".  Let’s make 2016 the year of building bank advocacy.  Here are four things to consider implementing this year that will likely help:
1) Grow your network. If you only have a relationship with your relationship manager, then you are at risk of having no relationship when your banker gets a new job.  You need to set yourself a target of meeting at least five people that have an active interest in your business.  These people might include the State Manager, the Regional/District Manager, the Credit Manager, the Invoice Finance/Trade Finance/Equipment Finance Specialist, the Treasury person. The more people who know you, and are familiar with your business, the less concerned you need be when your manager moves on.
2) Host a quarterly catch-up - proactive information-sharing is key.  Invite the list of people from above that you want to build relationships with to a quarterly information- sharing moment, preferably before you hand over the financials for the period.  Use this session to share the challenges and successes of the previous quarter, the focus for the next quarter and to identify any messages that the bank should know before they review the results.  Share everything - good news and bad.  They are your partner so if you are sharing in this environment (and with this regularity) they are more inclined to assist when you are faced with a problem.
3) Share your forecast and your budget. Your budget, set at the beginning of the year, sets the expectation of performance.  The forecast shows how the performance is likely to differ from this.  By sharing both, you are proving to the bank that even if things aren't going to plan, that you know and are taking action to do something about it.
4) Give them everything you can. The best way to get your relationship manager's attention is to help them reach their profit target (and bonus).  There are services that the bank offers that mean little to you if you buy from them but mean a lot to them.  Commercial credit cards, merchant facilities, some general insurances and super products.  The more you buy, the more important you become.  Obviously you would only do this if commercially valid, however.
If you would like us to review the strength of your bank relationship feel free to contact me for a no obligation chat.  The stronger your relationship, the quicker your funding applications will be processed, the more supportive your bank will be, and the less frustrating your bank relationship becomes.

For further information please contact:

Sam La
Moore Stephens Victoria
Associate Director
T +61 3 9608 0179
M +61 409 736 105