How to Deal with Banks
In this article from “The Small Business Survival Guide” By Ray Silverstein, we’ll talk about some top strategies for on how credit lenders can offer effective financial planning Solutions, and how to use your relationship with your bank for success.
When choosing a bank, the first question you should ask yourself is: what activities do you need your bank to accomplish on your behalf? For example, do you need a bank to handle international activities, lending, cash deposits, or…whatever?
Obviously, you should select a bank and banker that understands your business. If the bank understands your business, it makes “life” easier for all concerned. It is assumed your bank and bank representative are responsive—i.e., they answer your questions thoroughly and get back to you on a timely basis. It is your responsibility to be open and forthright with your bank, and to be timely with providing information.
A banking relationship is one of trust. Trust cannot be formed with your bank if you hide information or are always late in providing it. When you miss your reporting due dates, it indicates that your financial controls and capabilities are not up to par…yes, even if your numbers are positive! It’s not enough to pay the bank on time. The bank expects you to make your payments on time, just as you expect your bank to be timely and responsive in its dealings with you.
Top strategie! Know Your banker, and lending officer! (and His Boss)
Your banker plays an important role in your company’s growth. Treat him the way you would treat a favorite customer.
Get to know your banker and make sure he or she knows you. Touch base regularly and cultivate a relationship, keeping him or her up-to-date on your business. Don’t wait until you have a problem; create credibility for yourself every chance you get. If you do have a problem, speak up early and honestly.
It is advantageous to know several bank officers in the area of services you use, so make a point of meeting your banker’s manager. Banking is not like “the good old days,” when you would deal with the same person for life. Banks do have turnover, and you may need someone to “carry your banner” when you want to borrow money or extend your credit limits.
Besides, loans are approved—not by individuals—but by internal committees. When you have a loan up for approval, you want as many people as possible who know you, and are on your side.
If your want the full chapter, email our founder, Ray Silverstein a
ray@propres.com, for a free e-copy of the book!
