NEW CLIENT ACQUISITION.HOW-TOS.FEBRUARY 26 2015.V1
Transcript of NEW CLIENT ACQUISITION.HOW-TOS.FEBRUARY 26 2015.V1
The New Client Acquisition Process
A Road Map for Managing Your Market and ProactivelyDeveloping Relationships
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The New Client Acquisition Process
A Road Map for Leading a Proactive Business Development Process
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The New Client Acquisition Process
DEFINE THE MARKET AND BUILD A FOCUS
The How-To Section: An Articulated Process
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The New Client Acquisition Process
1. A Relationship Development Meeting is a face-to-face meeting that focuses on two things:
• Identifying and developing the Business Owner’s tangible needs and intangible needs.
• Matching your solutions to the developed and agreed-upon needs.
2. A Marketing Call (or Marketing Touch) is an interaction that keeps the bank or banker “top-of-mind” with the client/prospect.
• An “overview” of Business Owner’s possible needs.
• An overview of “what we do”.
• “If we can help. . . Let me know.”
Definitions. . . Relationship Development Meetings vs. Marketing Touches
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The New Client Acquisition Process
Opportunity Generation
Qualifying the Opportunity
ProposalInternal SaleExternal Sale
Closed Transaction
Build Long-Term
Relationship
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50% Proactively Developed Opportunities
50% Reactive and Transactional Opportunities
Balance the Proactive and
Reactive “Activity” within Your
Market. . . Keeping a Proactive
Focus on the Right Prospects.
Market Development Requires Discipline
The New Client Acquisition Process
Segment the Client Base
1. Retention Relationships
2. Expansion Relationships
3. Acquisition Relationships
4. Other Clients
Stay Focused on the “Right” Clients (An Example of Key Relationships)
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The New Client Acquisition Process
Retention Relationships are clients who meet these criteria:
• Have good credit quality.
and are
• In top 10% of aggregate loans and deposit balances.
• Your Bank has >60% of the loans and deposits of the business.
Expansion Relationships are clients that meet these criteria:
• Have good credit quality and match the “Targeted Relationship Profile”.
and are
• Your Bank has less than <60% of the loans and deposits of the business.
and have
• Significant cross-sell/up-sell opportunities in next 18 months.
Stay Focused on the “Right” Clients (An Example of Key Relationships)
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The New Client Acquisition Process
High Appeal Industries Limited Appeal Industries
Manufacturers Real Estate Investment
Wholesalers Low-End Retail
Distributors Restaurants Architect, Engineering and Business Service
Firms Mini-Warehouses/Carwashes
Law Practices Landscaping
Accounting Firms Service or Gas Stations
Insurance Brokers or Firms Used Car Dealerships
Large General Contractors Real Estate Investment
Medical, Dental and Health Practices Low-End Retail
Ag-Related Businesses Restaurants
Stay Focused on the Right Businesses
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Defining the “Industries” you want to Focus on
The New Client Acquisition Process
Business Characteristics
In business over 3 years
Sales revenue between $500,000 and $3,500,000
Employing more than 5 people
Location within footprint
Privately held with experienced management team
Borrowing needs under $1,000,000
Profitable (Net Profit After Tax) for the last year
Leverage (Debt-to-Worth) less than 3 to 1
Deposit balances average more than $50,000
Using or needing 5 or more business banking/consumer banking product categories
Stay Focused on the Right Businesses
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Defining the “Businesses” you want to Focus on
The New Client Acquisition Process
Business Characteristics
In business over 5 years
Sales revenue between $3,500,000 and $25,000,000
Employing more than 10 people
Location within footprint
Privately held with experienced management team
Borrowing needs greater than $1,000,000 and less than $10,000,000
Profitable (Net Profit After Tax) for the last year
Leverage (Debt-to-Worth) less than 3 to 1
Deposit balances average more than $100,000
Using or needing 5 or more business banking/consumer banking product categories
Stay Focused on the Right Businesses
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Defining the Businesses you want to Focus on
The New Client Acquisition Process
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Business Owner
DDA DDA
MMA MMA
Web-Based Banking/Cash Management Web-Based Banking
Line of Credit Investments
Equipment Loan/Lease Retirement Planning/Retirement Plan
Commercial Mortgage Jumbo Mortgage
401(k) Home Equity Lines or Loans
Liability Insurance Life Insurance
Key Man Insurance, Buy/Sell Agreement
Total: 9 Total: 8
Business Services: 15-years, $3,500,000 in sales
Revenue Opportunities Increasewith the Right Relationships
Target: 65% of the “Relationship”
The New Client Acquisition Process
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Business Partners(s)
DDA/Cash Management DDAMMA MMALine of Credit, Acquisition Financing Web-Based BankingEquipment Loan/Lease Private BankingCommercial Mortgage Investment ManagementPayroll Retirement Planning/Retirement PlanMerchant Account Jumbo Mortgage401(k) Home Equity Lines or LoansLiability Insurance Life Insurance
Key Man Insurance, Buy/Sell AgreementTotal: 10 Total: 9
Revenue Opportunities Increasewith the Right Relationships
Professional Practice: 18-years, $8,500,000 in sales
Target: 65% of the “Relationship”
The New Client Acquisition Process
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Distributor: 28-years, $28,500,000 in sales
Company Decision Makers, Key Employees
Treasury Management Private Banking
Working Capital, Acquisition Financing Investments
Equipment Loans/Leases Jumbo Mortgage
Commercial Mortgage Home Equity Lines or Loans
Swaps, Derivatives Life Insurance
Investments Retirement Planning/Retirement Plan
401(k) Estate Planning
Liability Insurance
Key Man Insurance, Buy/Sell Agreement
Employee Banking
Total: 10 Total: 7
Target: 65% of the “Relationship”
Revenue Opportunities Increasewith the Right Relationships
The New Client Acquisition Process
CHANGE THE CONVERSATION
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The How-To Section: An Articulated Process
The New Client Acquisition Process
Building Relationships require a series of Relationship Development Meetings that build momentum.
And, seeing things and hearing things that your competitors don’t.
Changing the Conversation
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Each Relationship Development Meeting is a Structured
Communication Process.
*Needs = Areas of Concern, Un-Optimized Processes or Explicit Product Needs
The New Client Acquisition Process
1. Where are you banking?2. What products are you using?3. How are they priced and structured?4. What 2 things do you wish your bank
was doing but they’re not?5. Can I have a copy of your
statements to put together an offer of how we would handle your banking relationship?
Where are the Business Issues here? These questions focus on products;
comparing your products with a competitor’s. These questions demonstrate
product acumen!!
Look at these Questions. . .
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Changing the Conversation
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*Needs = Areas of Concern, Un-Optimized Processes or Explicit Product Needs
The New Client Acquisition Process
A “Business” Conversation (Business Acumen)
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These questions align with a Business Owner’s Business Strategy, Business Plan, Business
Objectives, Business Operations. These questions demonstrate business acumen!!
Use this Question Set to Demonstrate Business Acumen and Building
Relationship Momentum
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*Needs = Areas of Concern, Un-Optimized Processes or Explicit Product Needs
The New Client Acquisition Process
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And this is Recorded in aRelationship Plan
A Relationship Plan lets multiple eyes, multiple brains uncover opportunities, build a strategy and plan the next steps.
The New Client Acquisition Process
ACQUIRINGNEW RELATIONSHIPS
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The How-To Section: An Articulated Process
The New Client Acquisition Process
What does it take to build momentum more quickly and to consistently overcome inertia?
1. In the First 3 Conversations. . . build momentum and begin to build Loyalty by establishing [1.] your Business Acumen by aligning with the Changes in the Business Owner’s Life.
2. When Getting the 1st Appointment. . . be introduced by someone the prospect knows. Trust and Rapport is built more effectively and more quickly when you are introduced with a testimonial referral.
Building New Relationships Faster
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The New Client Acquisition Process
Understand your “Prospect”.
1. Know the Industry Sector (What’s Changing in the Industry).
2. Anticipate what Business Issues are created by the Sector Changes.
3. Anticipate what may be Changing in the day-to-day Business Processes.
4. Anticipate what may be Changing in the day-to-day Financial Management Processes.
5. Be prepared to listen for and align with the company’s short-term, mid-term and long-term business changes and financial management changes.
6. Anticipate the “Value Drivers” of the Business Owner.
7. Anticipate for ways to optimize their capacity to achieve the objectives.
Acquiring New Relationships. . .Build a Strategy
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Understand the “Prospect” . . . better than the current Banker does.
The New Client Acquisition Process
Acquiring New Relationships
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These are the 8 Elements in a Proactive New Client Acquisition Process.
The New Client Acquisition Process
1. “It's Marketing's job to provide us leads.”
2. “Get me a better list.”
• A list of businesses that want to change banks now!• “The list isn’t perfect. . . there are dead people on here!”
3. Focus on former customers from “my old bank”.
4. Each Banker builds his own prospect list.
• Not sharing it with team members or other LOBs for feedback.
5. Rely on a single source for prospect names.
6. Keep it all in your head.
• “I have an amazing mind, I can keep it all in my head.”
Ineffective “Best Practices” for Building Prospect Lists
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The New Client Acquisition Process
1. D&B Strategic Marketing Database, Hoovers Lead Builder, Data.com
2. ReferenceUSA
3. Local Industrial Development Authority (electronic version)
4. UCC Filings (there are compilation services)
5. Local Business Publication directories (not always a good choice, too visible)
6. Guidestar.org (a great source for 501C3s)
7. Trade Association Memberships or Websites (a few examples)• American Society of Association Executives (www.asaenet.org/find/)• American Dental Association directory (www.ada.org)• American Institute of Architects directory (www.AIA.org)• State and local trade association listings
Using Multiple Sources for Your Prospect List
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The New Client Acquisition Process
The Three Critical Discussions with “Prospects”
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Three Conversations[Optional] Introduction Meeting
1. Business Opportunities, Business Challenges Discussion
2. Financial Management Process Discussion
3. Recommendations for Optimizing Changing Financial Management Processes
4. Follow-up on Optimizing Recommendations
5. Follow-up on mid-term and long-term Financial Management Process Changes
The New Client Acquisition Process
The First Critical Discussion with “Prospects”. . .
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The Business Acumen Conversation
[Optional] Introduction Meeting
1. Business Opportunities, Business Challenges Discussion
2. Financial Management Process Discussion
3. Recommendations for Optimizing Changing Financial Management Processes
4. Follow-up on Optimizing Recommendations
5. Follow-up on mid-term and long-term Financial Management Process Changes
The New Client Acquisition Process
Cognitively Processing the Prospect Folder
1. Review the Industry Sector Data. Build conversational competence on the issues and trends.
2. Get a mental picture of Business Operations of a Business in the industry sector.
3. Get a mental picture of Financial Operations of a Business in the industry sector.
4. Review the website of the Operation. Get a mental picture of where this Business is within the “industry trends”.
5. Review the website of the Business. Get a mental picture of Business Operations of this Business.
6. Review the website of the Business. Get a mental picture of Financial Operations of this Business.
7. Anticipating the Possible Changes in this Operation over the next 12, 24 and 36 months. (Think of these as Business Issues and Challenges.) Possible shifts in Business Objectives. Possible changes in the Business Operations. Possible changes in the Financial Operations. Possible changes if they want to grow. Possible changes if they don’t want to grow.
These Critical Discussions require“Cognitive” Preparation
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The New Client Acquisition Process
The folder includes these:
1. Industry Trends and Data (First Research, IBISWorld, Ementor)
2. Trade association data on the industry
3. News articles on the industry (Google)
4. The prospect’s web site
5. News articles on the Business (Google)
6. News articles on the Business Owner (Google)
7. Linked-In Search on Decision Makers
A Prospect Folder is the Foundation forCognitive Preparation
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The New Client Acquisition Process
The First Critical Discussion with “Prospects”. . . What are You Learning about the Business?
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The Business Acumen Conversation
[Optional] Introduction Meeting
1. Business Opportunities, Business Challenges Discussion
2. Financial Management Process Discussion
3. Recommendations for Optimizing Changing Financial Management Processes
4. Follow-up on Optimizing Recommendations
5. Follow-up on mid-term and long-term Financial Management Process Changes
The New Client Acquisition Process
If you can’t answer these questions you aren’t building “Business Acumen” with the Decision Maker:
1. Are there any industry trends affecting this Key Decision Maker today? What were his comments on the industry changes? Is the Decision Maker adjusting (changing) his/her business strategy or business plan this year?
2. How are the industry trends that he/she discussed affecting his business objectives this year? Over the next 3 years?
3. How will the Decision Maker use his Keys to Success/Value Drivers in implementing the “new” Business Objectives?
4. How is the Decision Maker adjusting his Business Operations, given these changes in his Business Objectives and his Value Drivers?
5. How do you think the changing Business Operations will change his day-to-day Financial Operations? His receivables, payables, liquidity, working capital, risk mitigation?
6. What next steps did you and the Decision Maker agree on?
After the Call, What Did You Learn from the “Business Conversation”
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The New Client Acquisition Process
The Second Critical Discussion with “Prospects”
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The Financial Management Conversation
[Optional] Introduction Meeting
1. Business Opportunities, Business Challenges Discussion
2. Financial Management Process Discussion
3. Recommendations for Optimizing Changing Financial Management Processes
4. Follow-up on Optimizing Recommendations
5. Follow-up on mid-term and long-term Financial Management Process Changes
The New Client Acquisition Process
Based on the Changes in the Business Processes, Think about what will Change in the Financial Management Processes. . .
1. Think about the Receivables:• Build a list of their primary “market” segments• How do they probably invoice customers; What are the typical terms?• How does each segment probably pay them (ACH, check, wire, etc.)?• What do those payments probably look like (amount and frequency)?• What may not be working “optimally” now?• What may not be optimal in the next 12 months, 24 months, 36 months?
2. Think about the Payables:• Build a list of their primary expenses (including labor)
• How are they probably invoiced by their suppliers; What terms are they extended?
• How do they probably pay each expense (ACH, check, p-card, wire, etc.)?
• What do those payments probably look like (amount and frequency)?
• What may not be working “optimally” now?
• What may not be optimal in the next 12 months, 24 months, 36 months?
The Financial Conversation Requires Preparation
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The New Client Acquisition Process
3. Think about how they manage liquidity/working capital?
• From the time they receive a payment until they make a payment, how does the cash flow through the business (the accounts they use, etc.)?
• How do they know their cash position every morning?
• What do they do when they have too little cash?
• What do they do when they have too much cash?
• How do they manage CAP EX needs?
• How do the Owners take money out of the business? Where does it go? (Another bank?)
• What may not be working “optimally” now?
• What may not be optimal in the next 12 months, 24 months, 36 months?
The Financial Conversation Requires Preparation
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The New Client Acquisition Process
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Looking for Areas of Concern. . . To Optimize in the Next Conversation
The New Client Acquisition Process
The End-to-End Financial Management Conversation
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The Business. . .
The New Client Acquisition Process
The End-to-End Financial Management Conversation
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The Business Owner’s Life. . .
The New Client Acquisition Process
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Product Solutions Sit below Financial Processes
Financial Management Processes use Products to optimize some element of those processes
Cash Position [Operating Account]
• IB Checking• NIB
Checking• Data
Services• Imaging
Services• Information
Reporting
Receivables
• Cash Concentration
• Cashiering• Image
Deposits• Lockbox
Services
Payables
• ACH Services
• Controlled Disbursement
• Integrated Payables
• Payroll • Wire
Too Little Cash[Credit]
• ABL• Commercial
Card• Credit Card• Credit
Sweep• CRE Loan• Lease• Revolver/
LOC• Standby
Letter of Credit
• Syndication (Lead)
• Trade Finance
• Term Loan
Too Much Cash[Investments]
• Asset Management
• CD• Corporate
Trust/Escrow
• Custody• Endowment
s & Foundations
• 401(k) Plans
• Investment Sweep
• Money Market
• Savings
RiskMitigation
• Derivatives• FX• Fraud
Protection• Insurance• Letter of
Credit• Reconcilem
ent Services• Trade
Services
Personal Banking
• Personal Investments
• Personal Trust*
• PB Deposits• PB Loans• Consumer
Solutions*• HELO
AN• HELO
C• Mortg
age• Other
Loans• Chec
king• Savin
gs
The New Client Acquisition Process
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Looking for Areas of Concern. . . To Optimize in the Next Conversation
The New Client Acquisition Process
If you can answer these questions in detail you completed successfully the Financial Conversation.
1. Describe the process the Owner uses to manage his invoicing and receivables process. Starting with the largest customer segment down to the smallest.
2. Describe the process the Owner uses to manage his expenses and payables process. Starting with his largest expenses and down to his smallest.
3. Describe the process he uses to manage his cash position on a day-to-day basis.
4. Describe what he does when he has too much cash.
5. Describe what he does when he has too little cash.
6. Describe what he does to take money out of the business, say for a shareholder distribution.
7. What were the recurring themes that you heard, for example, convenience, security?
8. What were the un-optimized areas that you uncovered and confirmed with Owner?
9. Did you get agreement to a next meeting to present “Optimized Ideas”?
After the Call, What Did You Learn from the “Financial Management Conversation”
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The New Client Acquisition Process
The Third Critical Discussion with “Prospects”
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The Optimization Conversation
[Optional] Introduction Meeting
1. Business Opportunities, Business Challenges Discussion
2. Financial Management Process Discussion
3. Recommendations for Optimizing Changing Financial Management Processes
4. Follow-up on Optimizing Recommendations
5. Follow-up on mid-term and long-term Financial Management Process Changes
The New Client Acquisition Process
1. Using the Financial Management Map you reviewed with the Decision Maker, update the Map with the not-optimized processes you agreed on.
2. Determine if and how you can add value to this business’s current cash cycle (review with your Business Partners too).
3. Create an Optimized Map that you will present to the Decision Maker. Include the following:
• The product/service name (next to the appropriate box).
• “Flow lines” that show how it will “hook” together.
• An estimate of the costs/fees on a monthly basis for the optimized elements.
4. Create a statement that shows how your total solution matches the “intangible needs” of the Decision Maker.
Preparing for the “Optimized Solutions” Conversation
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The New Client Acquisition Process
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Product Solutions Sit below Financial Processes
Financial Management Processes use Products to optimize some element of those processes
Cash Position [Operating Account]
• IB Checking• NIB
Checking• Data
Services• Imaging
Services• Information
Reporting
Receivables
• Cash Concentration
• Cashiering• Image
Deposits• Lockbox
Services
Payables
• ACH Services
• Controlled Disbursement
• Integrated Payables
• Payroll • Wire
Too Little Cash[Credit]
• ABL• Commercial
Card• Credit Card• Credit
Sweep• CRE Loan• Lease• Revolver/
LOC• Standby
Letter of Credit
• Syndication (Lead)
• Trade Finance
• Term Loan
Too Much Cash[Investments]
• Asset Management
• CD• Corporate
Trust/Escrow
• Custody• Endowment
s & Foundations
• 401(k) Plans
• Investment Sweep
• Money Market
• Savings
RiskMitigation
• Derivatives• FX• Fraud
Protection• Insurance• Letter of
Credit• Reconcilem
ent Services• Trade
Services
Personal Banking
• Personal Investments
• Personal Trust*
• PB Deposits• PB Loans• Consumer
Solutions*• HELO
AN• HELO
C• Mortg
age• Other
Loans• Chec
king• Savin
gs
The New Client Acquisition Process
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The Financial Management Processes Link to Products [but are not Products]
The New Client Acquisition Process
Receivables: Areas of Concern1. Delay in deposits and checks coming to home (fraud concerns)
2. Concerns about website payments flowing through multiple vendors (website host, PayPal, Merchant Card processor, Bank
Payables: Areas of Concern1. Wants to reduce any possibility of fraud exposure when using wireless networks
2. Would like to simplify payables and move everything to one credit card
Cash Position: Areas of Concern1. Operating Line may not be sufficient to handle several new clients
2. Would like to see all online accounts listed on one screen, with real time reporting and a single log on to simplify use (business and personal)
3. Wants to upgrade data systems, hardware and software in the next two years
4. Potential acquisition of a new firm
5. Considering purchasing a townhouse for his son in next 6 months
Areas of Concern from the Financial Operations Meeting
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