The story is a familiar one. A small-business owner is talking with his banker, who casually mentions the money he could be saving with a particular service.
"I liked what I heard," the owner says later. "I just wondered why he hadn't brought it up before in the three years we've been working together."
We've all been there - learning too late about the time or money we might have saved. And we wonder: Isn't it the job of our bankers and other financial advisers to tell us?
The answer, of course, is yes. The number of banking products and services available can be overwhelming. That's why, in a perfect world, your advisers should be meeting with you regularly, listening to your needs and making sure you're taking advantage of the latest and greatest solutions.
But in our less-than-perfect world, how can you know if you're really managing your money as effectively as possible, minimizing fees and maximizing return? The only way to find out is to ask. Here are three places to start.
1. Basic money management: Do I have the best account for my business needs?
If you tell a banker that you want to open a small-business checking account, there's a good chance that you'll get one. However, that may not be what you really need.
It's better to have an open-ended discussion with your banker about the expected size and number of your deposits and disbursements, as well as your borrowing and investment needs. Your bank may have a bundled product - a package of services that provides discounts on some services, better interest rates on others, along with other benefits that may appeal to you. Sometimes, you can combine your personal and business accounts and save even more.
Don't forget your employees in this discussion. Some banks offer a product that allows you to deposit your employees' earnings directly into their checking accounts - saving you the cost of cutting payroll checks.
2. Treasury management: Am I doing everything I can to improve cash flow, streamline payment processing and reduce costs?
Every small business I know wants to be smarter about managing its finances. And there are countless tools available to help. The key is learning which ones are best for you.
Businesses that receive paper checks, for example, can gain access to funds faster and improve cash flow by processing them electronically. Remote deposit technology makes it possible to process receivables as you receive them, right from your office computer, rather than making trips to the bank. That saves both time and money.
If you have a service that your customers pay for monthly, it may be time for an automated clearing house line of credit that automatically transfers customer fees from their checking account into yours. A business that requires employees to visit customers' homes or offices may similarly benefit from mobile technology that enables them to take electronic payment before they leave. You'll not only streamline your invoicing process with tools like these, you'll reduce the number of bad checks you receive and must later collect on.
3. Expense management: Am I managing my expenses as efficiently as possible?
Expense management is more than just paying the bills. It's knowing you have the proper controls and reporting tools in place to guard against fraud, while saving time or money in the process.
There are a host of commercial cards available to help you achieve these goals. Fleet cards, for example, can help you manage fuel, auto maintenance and repair expenses. Purchasing cards can decrease your reliance on purchase orders, invoices and checks. Commercial cards can do both - while also managing your travel and entertainment expenses.
With expense management, as with all financial management, just remember that one size does not fit all. After asking about and listening to your needs, your banker should be able to offer a solution that is tailored to your company - which is what you really wanted all along.[[In-content Ad]]
Stoney Roberts is vice president of small-business banking at Commerce Bank in Springfield. He may be reached at stoney.roberts@commercebank.com.
