“What is the name of your banker?”
“Chase,” she responded.
“Not your bank. Your banker.”
Most CEOs I work with have no idea who is responsible for their banking relationship. And that’s a problem. Your banker is often the best source of short-term capital, critical to bridge the costs of your company’s growth.
- To buy the raw materials needed for that huge order you just landed.
- To hire the new sales staff to expand into that new territory.
- To fund the creation of new products to take your business to the next level.
- To cover payroll when your new clients are slower paying than you expected.
Yet CEOs often not only have no idea who their banker is, but they haven’t spoken to them in a year. Maybe it has even been a few years. Sometimes it hasn’t been since they opened their business accounts.
Truth be told, CEOs think of their bankers only as salespeople – and avoid them. That is until they need something from them (money). Then they wonder why the banker won’t fight harder for them.
Who’s selling now?
It is important to not only know your banker’s name, but for them to know you and your business. I recommend CEOs meet with their banker quarterly with their financials, discuss how business is going, and to share the plans you have for your company.
A good banker will share external or industry trends that may affect your company, news on the local business climate, and changes in financing options. A good banker will listen to your future financing needs and help you build a plan to ensure you are qualified for the financing before you need it.
Even if things don’t go as planned and you need unexpected financing, you will find an informed good banker will be able to help you in ways you may not expect. I’ve even had good bankers assist me in obtaining financing from other parties, when they were unable to help me directly.
There is no better time to start making your banker your new “best friend” than right now. It is a CEO best practice.
And if your current banker won’t invest the time in you, it is time to find a new and good banker.
If you are interested in more CEO best practices, contact me.
“I saw a bank that said ’24 Hour Banking’, but I don’t have that much time. “
– Steven Wright