Does Your Bank Provide Answers or Solutions?
We’re in the midst of a particularly unpredictable and challenging economic period. Yet, regardless of whether times are tight or plentiful, your bank should serve as a strategic business partner.
If your banker simply takes orders and responds to requests rather than getting to know your business and anticipating needs, it could be costing you money.
Unfortunately, not all banks will take the time to get to know your business well enough to offer real solutions. This is especially true for banks that prioritize “big fish” over small businesses.
What Is a Solutions Mindset?
Customers often initiate conversations with a bank by asking about loans and interest rates. However, you may be surprised to find out:
- Most banks offer similar loan products and services
- Most banks will come within a quarter or tenth of a percent on interest rates
A business banker with a solutions mindset will answer your questions about rates and terms and then proceed to ask a series of questions to better understand your specific situation.
A conversation in search of a solution will focus on the following goals:
- Saving you time
- Saving you money
- Helping your business grow
- Helping your business change or transition
A solution won’t just answer your question. In fact, a real solution might not involve a loan at all. Your banker should bring you ideas and opportunities along with answers. Our goal is to help your business thrive by finding the best path forward.
Real-Life Examples
Recently, a customer asked about a loan for a new piece of equipment that would increase production by 15-20 percent.
As part of the loan process, a Lake Ridge Bank business banker visited the facility for a tour. In an effort to completely understand the return on investing in this new equipment we asked a lot of questions, such as where they would store the additional inventory. After all, to increase production by 15-20 percent, they would need room for 15-20 percent more raw materials, as well as space for the additional finished goods. It turns out that their inventory storage areas were already at capacity. More discussion revealed they were also working mandatory overtime because of a labor shortage.
The combination of labor issues and storage limitations made the customer reexamine the potential investment. When they revised the math, their margins dropped to only 3.5 percent. In this case, the customer chose not to purchase the new machine until they could improve the expected returns. Eventually, they were able to make the investment with more likelihood of a successful result.
In another example, a customer was considering an addition to their building. Following an on-site tour and in-depth discussion, we suggested an alternative. After researching the suggestion, the customer chose to revise their shipping protocols and reallocate the extra space in order to forego a full-on expansion project. The best solution was to utilize the existing space more efficiently and effectively.
Does Your Business Need a Solution?
Whether you would like to discuss an immediate solution or perhaps want to bounce possibilities off of a problem-solving partner, Lake Ridge Bank has a team of commercial bankers who can offer strategic thinking with your best interests at heart.
To start a conversation, contact us with your question or call the Lake Ridge Bank location near you.