Imagine you are a small business owner taking time during your busiest season to meet with a representative from your bank. After exchanging pleasantries, your banker opens the conversation by saying, “Our bank is offering several specials for businesses like yours. What kind of loan are you looking for?”
You’d likely be frustrated and dissatisfied. Your banker hasn’t taken the time to understand how your business operates or to identify and address your specific borrowing needs.
Now imagine your banker starts the conversation with, “I understand that businesses in your industry typically have a difficult time maintaining sufficient cash balances during this busy time of year. If this is true for you then I may be able to help you. Do you have a few minutes to talk more about your business in particular?” With that opening, your banker has shown a working knowledge of your business and the bank’s willingness to help. You’d likely feel more comfortable about the conversation and any business that results–and you can get back to your own business faster.
For bankers to ask these types of needs-based questions and engage small business owners in a collaborative dialogue, they first need to possess strong business acumen. Unfortunately, most small business bankers don’t know what they’re looking for when they meet with prospective clients or how to ask leading, insightful business questions.
This knowledge gap can lead to a lack of confidence and competence when discussing finances and operations with small business owners. Training with a focus on expanding and strengthening small business relationships can help bankers overcome these skill gaps by developing their knowledge of business fundamentals, so they are perceived as more than simply “order-takers.”
Another challenge business bankers face is how to articulate a recommendation once they acquire the information they need. Bankers need to understand the issues and challenges business owners face every day before they can recommend a solution. Understanding how to uncover and assess risk in lending opportunities enables bankers to ask questions that resonate more deeply with their customers and communicate a lending solution more effectively.
Every financial institution should aspire to have small business owners leave meetings with their representatives and think “Wow, that was one of the best discussions I’ve had with a banker about my business!” If your bankers are able to understand how their customers’ businesses operate and apply business acumen to conversations, they will be better positioned to engage in meaningful, reciprocal discussions that add value and differentiate your institution from all the others.
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