Start with the person who controls the money
While financial institutions in this country have taken it on the nose for our current economic conditions, it is none-the-less vital that you develop the type of relationship with your banker that fosters mutual trust.
I have heard clients speak about their respective banks and bankers as if they were road blocks or adversaries in our clients’ quests to prosper. I listen to their stories of “nay saying bean counters” and how they “don’t know a thing about this business!” I tell them they’re probably right. They don’t know because you don’t tell them.
Your banker is definitely not your enemy. They are more than just a gatekeeper, and you would do well to make them a part of your management/guidance team. Good bankers have tremendous insight into a lot of industries. They may even be your competitors’ banker (think about that), but they won’t know how to help you if you won’t let them. Your banker can be instrumental in advising and guiding your company on a number of business decisions.
What are they good for?
Beyond extending you credit and disbursing cash loans, a good banker can assist you with reviewing you financial data (you do review your financial data, right?) and identifying benchmarks or improvement areas. They can advise you on cashflow management and develop streamlined systems to optimize overall profitability. A banker can also assist you with obtaining short- and long-term financial goals with proper investments.
As a side note. Powered Agriculture’s banker, Leo, has been great at creating opportunities for our employees as well. We can assist them with personal accounts, direct deposits, and most recently retirement accounts. Any of which would have been too cumbersome if not for Leo’s assistance.
Relationships that work.
Develop a relationship with your banker immediately. Dialogue with them. Find out as much as possible about the person who will have intimate knowledge of your business. How long have they been in the business? How much do they know about your industry? What services can they (i.e. the bank) offer? It’s ok if you feel that you need to seek a different banker than the one you have already been ignoring. The important thing is to find the person that you can work with to help guide your company to greatness.
Let your banker know about your company’s current state of affairs. What financial position is it in? What factors affect the industry’s seasonality? Who are your key employees? What is your personal goal or exit strategy for the business? These are all situatons that would be much better handled with a banker by your side.
A man with a plan
You might feel a little forced into planning things that you had no intentions of planning, but in the end it will make you and your company better. Plus, any good banker is going to want the information in order to make decisions about working with you so you might end up having to do it anyway.
The bottom line is that your banker should be an asset to your business and not a burden. It is up to you to develop that relationship and receive all the knowledge and guidance your banker has to offer.
