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Maximizing Branch Performance

When was the last time you ‘tuned’ your branch network?  You tune up your car to make sure it runs at peak performance.  Your branch network deserves the same attention.

Generally speaking, most financial institutions with multiple branches have the following breakdown:  a quarter of the branches are very profitable, half are doing just fine and a quarter are stinkers.

Do you have a branch that’s over 30 years old?  Is it still growing or has it flat-lined?

Convenience is still the primary factor when customers select a bank.

A bad branch location can drain your capital faster than your teenage daughter at the mall.  Location, location, location, ties convenience to profitability.

Take your worst performing branch and fix it, relocate it or close it.  Relocating a poorly positioned branch to a more convenient location (eg., the new retail part of town) will increase sales.  Closing or relocating branches takes guts and hard work, but a continuing drain on your profits isn’t much fun either.

A Market and Demographic Study (and here comes the shameless self promotion), by a consultant that specializes in planning financial institutions can help assess whether you could decrease expenses or increase sales by tuning your branch network. This process is similar to the process used to identify new branch locations.

The risks and opportunities tied to branch locations make selection too important to handle casually.   Carefully tune your branch network and it will purr like the boat you’ll buy with the earnings.

Thank you for reading…

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Published on October 16, 2013