The dramatic growth of digital banking continues, a trend accelerated by the pandemic. This is prompting banks and credit unions of all sizes to take assess their branch network and make a range of renovation and right-sizing decisions.
There’s no better time than the beginning of a new year to carefully consider whether to retain, modify, consolidate, close, or move a branch. But where do you start? And how can you ensure that your decision-making is strategic and profitable?
Some key questions:
- For what purpose do each of your branches exist, now and in the future?
- Are they focused on the right activities?
- What do your customers want — and what do they do – when they visit a branch?
- What services and technologies do they expect (or will they demand) from their financial institution?
- How can you regularly meet and exceed their expectations?
Analyze Your Markets
Today’s Big Data resources can offer you a comprehensive understanding of the unique demographic and market trends affecting your business. Start with a gaining a full appreciation of who constitute your customer base, what market share is possible to achieve in a specific location, and what services, technologies, and amenities your customers will embrace. If you are ready to seek a service provider, AccuBranch, a corporate partner of Solidus, can provide you with a comprehensive view of your markets, identify prime locations for growth, help you avoid market cannibalization, and guide your real estate decision-making.
Optimize Branch Operations
Once locations are identified, another series of critical decisions await. What is the optimal size and type of branch for those locations. A full-service, 2,500 sq. ft. branch for both business and individual customers? A 1,000 sq. ft. hybrid banking center? A 250 sq. ft, self-service vestibule where you can access video technology? Or is a walk-up/drive-up ATM perfectly sufficient? This decision is often driven by the nature of your location(s) – urban, suburban, rural, or within a workplace.
Clearly, the footprint and purpose of your branch heavily influences your staffing model. Is there a need to provide commercial lending, investments, and mortgages at a specific location? Would a Universal Banker model work well for you? Should you make some branches teller-less? Does the branch design cater more to pedestrian or automotive traffic?
What technology and equipment must exist at a given branch? — ATMs, video ATMs, cash recyclers? Start with an activities analysis. What do your customers do at a certain branch. How might technology help them? What teller and personal banker activities – e.g., appointment scheduling, meeting follow-up – could be enhanced through technology?
January is a great month to assess the role and profitability of each branch in your network. You can be confident in a high-volume, profitable branch that effectively builds brand identity and serves a defined market niche. Conversely, it may be time to consolidate or close a branch that serves an area with declining population growth, overlaps with your other branch locations, attracts limited foot traffic, or serves fewer than 500 households per branch. Still other locations may need to be renovated or repurposed: Interaction with customers may be more important than transactions, or vice versa.
Solidus Can Help
Solidus stands ready to help you with all phases of the branch rationalization and optimization process, from location analysis to customer-centric design and construction. We are a turnkey general contractor that ties our success to yours. We seek long-term partnerships with our customers – fully 94 percent of our clients are repeat clients! Understanding your business enables us to design, build, and brand profitable facilities that will ensure your long-term success. Just contact us at 860-257-4900 or email email@example.com – we can help you position your branch network to evolve and thrive for years to come.