Tag Archive for 'Easton Bank & Trust'

Speak “banker” as a second language

Once a storm caused two ships to sink in the same area and all on board were lost at sea, save one from each ship, who survived only because they swam to a nearby island.

Fortunately, the two men hauled themselves up on the beach within sight of each other. But the survivors’ celebration soon faded as they realized that each spoke a language unknown to the other.

Immediately they had the same thought, “I don’t speak his language, but if we’re going to survive, we have to find a way to communicate.”

In many ways, this tale actually plays out every day. But instead of on the high seas, our story takes place in the marketplace. And instead of shipwreck survivors, our real life players are small business owners and bankers.

Like the castaways in the first story, the latter two often realize that:

  1. They need each other to be successful
  2. They don’t speak each other’s language very well, if at all.

With so much common interest and so little mutual understanding, can these two create a successful survival story? Absolutely, but only if they have Blasingame’s Official Translator for Banks & Small Business. Here are a few key examples of how the Blasingame Translator works.

For small businesses to understand banker they must:

  1. Identify their banker as a success partner and their business’ best friend.
  2. Stay close to their banker when things are going well and even closer when things aren’t.
  3. Believe that an uninformed banker is a scared banker and a scared banker won’t help you.
  4. Pay attention to what motivates and impresses a banker, like attention to detail.
  5. Understand pertinent bank rules and regulations, so as not to ask for something that can’t be done.
  6. Reward banker loyalty with your loyalty.

For bankers to speak small business, they must:

  1. Understand that it’s redundant to say “undercapitalized small business.”
  2. Recognize that starting a small business is easy - operating a successful one is not.
  3. Explain banking rules and regulations more often.
  4. Realize that it’s the banker’s job to recommend services and products.
  5. In the credit scoring process, always find a way to give small business owners credit for character and past performance.
  6. Reward small business loyalty with banker loyalty.

For small business, and bankers to avoid being castaways, speak each other’s language and become partners.

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On my radio program, The Small Business Advocate Show, I recently talked with Mike Menzies, President of Easton Bank & Trust in Easton, Maryland, about the key elements of a successful relationship between a small business and its bank. Take a few minutes to click here to listen or download our conversation.

Check out more great SBA content HERE!

Watch Jim’s videos HERE!

Take this week’s poll HERE!

Small Business Bank Relations are Improving

One of the markers of big businesses, especially publicly traded ones, is they have many capital sources.

For small businesses there are basically only three:

  1. Equity capital from the founder(s) and investor(s).
  2. Retained earnings - profits left in the business.
  3. Borrowed funds, typically from a financial institution.

The lion’s share of all small business capital comes from # 3, bank loans. Consequently, since small businesses generate over half of GDP, it’s easy to see that the health of the banking industry, and its receptiveness to small business, is vitally important to the U.S. economy.

Periodically, we poll our audiences about their banking relationships, which we did again recently. We asked, “Which example best describes your recent experience with a business loan from a bank?” and here’s what we learned.

Almost four of ten of respondents to our unscientific poll said, “We have gotten a business loan from a bank in the past year.” About one fourth of our sample said, “We can get a loan from our bank if we need one, but we don’t want one.” Here’s the good news for the economy in these responses:

  1. The greatest number of our respondents wanted, qualified for, and got a bank loan;
  2. At this point in the recovery, most bank loans by small businesses are more likely to fund opportunities rather than to save the business;
  3. Added together, approximately two-thirds of our small business respondents are confident they have the ability to borrow capital when, and if, they need it.

Sadly, about one-third of our audience is still struggling with their capital requirements. Ten percent said, “We need a loan, but can’t find a bank that will loan to a small business,” and 27% reported, “We need a loan but haven’t tried because we don’t think we can get one.” In a healthy economic expansion, these two groups should total no more than 10% to 15%.

There are a number of economic and political issues making up the loose gravel that the U.S. economy is currently standing on as it struggles to find growth footing. But an improving banking picture for small businesses is definitely a good sign of economic healing and expansion potential.

Every small business needs a good banking relationship, so keep trying until you get one. But remember, the perfect form of capital is retained earnings, because it is profits, produced from sales you make to customers, that you were disciplined enough to leave in the business.

Retained earnings will make your banker very happy.

I talked with Mike Menzies, President and CEO of Easton Bank & Trust in Easton, Maryland, recently about the key elements of a successful banking relationship.

Click here to listen or download our conversation.

Check out more great SBA content HERE!




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