Bankers Lend an Ear

Business bankers are no longer the people who just provide loans and overdrafts.  As Steve Hart reports, they now also offer advice, bring businesses together and open doors.

A new breed of business bankers has emerged over recent years – one that is tapping into the huge SME (small and medium enterprise) market. And it’s an extremely competitive sector. Individually, most businesses in New Zealand are quite small and some banks have struggled to understand or connect with them on a personal level. But all that is changing as banks reach out to offer more than just loans and insurance.
Banks, it seems, have realised that SMEs provide great opportunities. Data from the SME Research Centre at Massey University shows there are 350,000 SMEs in New Zealand that account for up to 99 percent of all businesses, and generate 50 percent of our GDP – that’s around $65 billion. You can see why banks might be interested in them.

To tap into this market, many banks have created a new level of support for business owners who can now access the resources and expertise of experienced bankers – some of whom have spent years running their own businesses.
Some banks are more advanced than others in this regard. Nevertheless, this change in attitude, this renewed focus on small business, is a good sign and perhaps one of the better things to come out of the global economic downturn.

Harry Ferreira, BNZ national manager small business, says the bank did an internal review three years ago on how it serviced the SME sector.
“We discovered that we really didn’t understand the space; I don’t think any bank did,” says Ferreira. “As a large group of customers they are exceptionally powerful.”
One of the main complaints made by small businesses, says Ferreira, is being able to speak with their business bankers.
“We were told by customers that they would call, would frequently have to leave a message, and then we would call back while they were under a sink doing plumbing, or up a tree as an arborist. So we weren’t seen as being very accessible.”
Ferreira says the bank has tackled the accessibility issue on four fronts, the main one being the installation of video kiosks in all its 180 branches. The kiosks allow customers to sit down and have face time with a business banker via a video conference and can be used if a business banker is not available at the branch.
“On the other end of the kiosks are 45 business managers who work seven days a week,” says Ferreira. “It means business owners need never leave a voice mail again. We have had the kiosks for two years and they handle 10,000 video conferences a month.”

There are plenty of businesses run from people’s homes and while that isn’t an issue per se – it can be awkward when it comes to meeting clients or prospects. Noisy coffee shops are not always ideal and while hiring a meeting room is easy enough, BNZ has come to the party with a suite of free rooms for its customers – complete with free WiFi, printers and refreshments at its Auckland site in Queens Street.
There are plans to provide similar facilities in Wellington and Christchurch.
“These rooms are really helping people do business,” says Ferreira. “It is a simple thing, but has really shown its value by providing professional meeting places for our customers and their clients. The design is funky and retro, rather than being too corporate.”

BNZ also organizes networking events at 90 of its branches on the first Tuesday of every month.
Ferreira says, “This gives anyone who wants to come along a chance to introduce themselves and make connections. Across the country more than 4000 people take part every month – anyone can stand up and talk about what it is they do – it has been really beneficial.
“Let’s face it; the main market of small business owners is other small business owners.”

Understanding clients’ needs
Over at ANZ, Fred Ohlsson, its national managing director, business banking, says the key to working with small business owners is to get to know them and their businesses – to understand what’s going on from inside out.
“It is really important that we understand clients’ businesses,” says Ohlsson. “What their situation is and what they need. It is the only way we can tailor a solution of lending, insurance and advice that meets their needs. With the number of mobile staff on the road we are spending more time with our clients.”
Ohlsson says it is also important for business bankers to understand the industries their clients work in. This, he says, helps them give advice when it is needed.
“It depends on the business banker’s skill and experience, but yes it does happen that we help guide owners in their business,” says Ohlsson.
“That is where a banker can add even more value. Although one has to be careful on what advice is given. But if I had a lot of experience in say a coffee shop, and saw a client was going wrong somewhere with their coffee shop, then I would gently advise accordingly. And my colleagues are encouraged to operate in a similar way.”

Ohlsson says the bank also has a lot of online resources on the Biz Hub section of its website, to help people who may only have the evenings to seek help and advice.
While business owners are generally proficient in the creation and delivery of the products they offer, Ohlsson says a lot of firms fall down by not understanding the importance of advertising and marketing.
“They seem to only worry about marketing when the revenue stops coming in, by which time it can be too late,” says Ohlsson.
To help out, the bank has a Smart Marketing course on its website.
Like the BNZ, Ohlsson says ANZ helps bring its clients together, having held 120 workshops attracting around 3000 people.
“These are great networking events where people can share experiences and help each other in business – they help establish worthwhile business connections.”

Virtual branches
Nick Stanhope, ASB’s GM of business banking, says the days of going to the bank for a loan and waiting two weeks for an answer are over.
“That history probably haunts us a bit today, but is long gone,” he says. “Today you can go to a virtual branch online and talk to a business banker and apply for a loan – although you’ll need to visit a branch to sign it off.”
Stanhope says banking has got fiercely competitive over recent years, “so we have to go to the customers, so they get the best experience possible.”
He also says the bank’s team of business bankers make a point to catch up with their clients at least three times a year.
“Then we know where they are at, where they are going. Then we can offer advice and assistance before anything becomes urgent – such as finding funds to purchase additional stock,” says Stanhope.

Stanhope says his greatest wish is that business owners put their hand up and ask for help, rather than struggle on.
“It is absolutely the best thing to do, to talk to the bank and let them know what’s going on because banks will bend over backwards to accommodate clients. We are in a partnership here and we often have more skin on the table than the customer does.
“So it is in all our interests to navigate a way forward to get through a rough patch or provide advice; putting them in touch with professionals outside of the bank who may be able to work with them.”

Whole-of-life relationships
Over at Westpac, senior business manager Mike Hirst says his business bankers have made a point of fully understanding their clients, what they do and what they want to achieve.
“We like to understand why they have this business today and what they hope to get from it in the future,” he says.
“It is all about having an intimate relationship and an understanding of both the business and the business owner – their goals, dreams and motivation.”
Hirst says if a client calls asking for a loan to fund new machinery he might go and find out why they need it, and take an interest.
“We look at it as a whole-of-life type relationship rather than a transactional relationship,” he says. “They might ask for an overdraft when a term loan is the best option.”
In one recent situation, Hirst helped injection-moulding firm Bonson while it built new premises for its factory, storage and distribution centre in south Auckland.
“I worked with them over three years as they searched for a new site, hired architects and erected the buildings,” he says. “I sat in at planning meetings and contributed where I could to achieve a solid outcome for my clients. Their new factory is just about to open.”

Steve Hart is a freelance journalist at SteveHart.co.nz

CASE STUDIES

Business:
Serengeti Restaurant + BNZ

Mark Coppin, owner of the Serengeti Restaurant (www.serengetirestaurant.co.nz) in Murray’s Bay, Auckland, says he switched to BNZ last year because they believed in him.
“I moved to BNZ one year ago, two years after arriving in the country and starting the restaurant in 2009, as I needed to consolidate my loans,” says Mark. “My only other choice was to go to loan sharks.
“The BNZ’s small business banking guy came to me, helped me put everything together – pretty much an unsecured loan – and since then we haven’t looked back.”
Mark, whose restaurant turned over $1.2 million last year, says while he was with his previous bank he was operating with an overdraft facility “which was quite costly”.
“Then when BNZ came along we were able to square that away and I have been operating in the green ever since,” says Mark.
“The BNZ’s Harry Ferreira was someone who believed in me, and that is what gave me the opportunity to turn my business into a success.”
Mark also says he appreciates the regular contact he has from his business banker and the advice offered.
“The other bank never called me after I got going, and if I went to them with a problem it wasn’t met with any advice or guidance. Whereas BNZ steers me in the right direction and opens doors for me.”

Business: Contact Training Systems + ANZ

Husband and wife Vicky and Quinton Swanson run Contact Training Systems (www.contacttc.co.nz). The company is a specialist in providing conflict incident management programmes to New Zealand and international government and military organisations.
Vicky says her first contact with ANZ was 18 months ago when the couple were arranging a mortgage.
“Our business was with another bank, but the service we got from ANZ was so outstanding we moved our business banking to them,” says Vicky.
One of the first things she noticed was the interest shown in the couple’s business by their new ANZ business banker.
“She really got to understand what we did, and where we are going,” says Vicky. “She took an interest in the business and would call once every few weeks initially – until she got to understand us. I never heard a peep from my old bank in all the years we were with them.
“I enjoy the regular communications I get and their willingness to help. Quite often I don’t even have to ring my business banker, she will call me to ask if we need anything, then she’ll pop over and we’ll have a get-together to talk about the business.
“With time being so precious it is just so helpful.”