Why a business banking relationship is important to your business

Consider the small business owner who’s on the verge of a significant breakthrough that could catapult their business to the next level, but they need money. Without a capital infusion, this person can’t hire the people or buy the needed equipment. This entrepreneur knows they need to secure a loan from a bank, but they’re dreading the process. To them, the banker represents an obstacle and not a conduit for solutions. Why? They don’t know the banker, and the banker doesn’t know them. While that isn’t a deal-breaker, it can steepen the uphill climb.

The lesson to be learned here is that the time to start a relationship with a banker is not when you need money; rather, it’s when you don’t need money. Had the small business owner introduced themselves to the banker in the early stages of their business, built a relationship and kept the banker apprised of progress, the need for money becomes the next logical step that both parties expect. Along the way, the owner and the banker could’ve worked together on any number of issues that would have cleared the path for a smooth transition to a loan discussion.

Their value is in the relationship, not the money

This scenario plays out too many times, mainly because small business owners don’t understand the importance of the banking relationship beyond the critical point when they might need to borrow some money. Not only are they missing out on a wealth of information and resources, but they also lose the opportunity to develop an advocate who can work on their behalf inside the bank and inside the community.

The fact is it’s never too early to start a relationship with a banker, even if your business is barely off the ground or still on paper. It may come as a surprise to business owners to know that banks are just as eager to start a relationship with them. Nothing is more valuable to a bank than a loyal business customer, who may need as many as twelve to fifteen different banking products and services throughout the business life cycle. But in a highly competitive market, banks know they must earn loyalty and will do so by offering valuable guidance and advice along the way.

What you need to know about bankers

To understand the value of a business banker, you need to understand the wealth of knowledge they can bring to the relationship. They know:

  • Cash flow. Managing cash flow is what bankers do best. Whether it’s recommending cash flow management solutions or providing advice on cash flow techniques, bankers are equipped with knowledge and tools to help you increase, smooth out or better utilize your cash flow.
  • You and your business. It takes a relationship, but once it’s underway, your banker will know you and your business better than anyone else. Not only do they become vested in your success, but they can also offer you guidance tailored to your specific business and personal needs.
  • People. Your banker is likely to be your best networking opportunity. Bankers know many people in the business community, and they build their influence by introducing their business owner clients to their network.
  • Credit. Building business credit is not easy. It can take time. Your banker can guide you along the way.
  • Technology. It’s a whole new age for small businesses, which formerly had to get by with rudimentary tools to help them manage their cash. New technologies have created scaled solutions for small businesses to manage their cash in the same way a large company does. Your banker has access to this state-of-the-art technology that can be customized to your needs and budget.
  • What businesses need. Bankers are the barometer for business needs, always looking for trends and solutions for their business clients. Those things can include fraud prevention solutions, human resource services, local marketing and ecommerce.

The essence of a solid banker/business owner relationship is trust and integrity, which is built over time. With it, you can enhance your business’s prospects significantly. When started early, the relationship has time to flourish before the critical needs arise, which can then be addressed as partners.

To learn more about Alpine Bank’s full suite of business services, read more here.

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