Jeff Judy

Jeff's Thoughts - November 14 , 2007

Do Your Small Business Customers Feel Like Business Customers?

Envision three different customers:

  1. One borrows to buy a very large piece of equipment;
  2. another borrows to buy a vehicle that is crucial in the borrower's small business; and
  3. one borrows to buy a second car now that the kids have reached driving age.

Sort those customers into two groups. Which ones have similar concerns and needs? Which ones are asking you to play a role in their business success?

Finally, sort these customers again, into two groups, based on how you process their applications. Which ones go through the same system?

In many financial services organizations, these two groupings, dealing with the same three customers, come out differently. Viewed from the customer's needs, the first two are both business customers, and the third is a retail or consumer situation.

But looked at from a processing point of view, given today's credit-scoring tools, that business owner who needs a commercial vehicle is probably handled more like a consumer than a business.

It is easy to forget that just because the decision processesfor small business and consumer loans are similar doesn't mean that the discussions you have with these customers should be the same. Your back room will take care of the processing, but I suggest that you take care of the customer.

Treating business owners as business owners is crucial to your success with this market, and there are few things that mean more to the small business owner than respect. This customer makes difficult decisions every day that decide the future of a business and have a direct impact on a number of employees. (Can you say the same?)

And after all, for any given customer, the credit score is going to be roughly the same. The software from your institution will give them more or less the same answer they're going to get from the competition.

But if they know that you recognize how hard they work, and the challenges they face, they'll do business with you rather than someone who treats them just as a number, as an "output." Frankly, many small business owners would be thrilled to find someone who "gets it", someone who understands what running a business really means, regardless of how the financial data get crunched.

And there's an extra return on your investment of a little time, attention, and respect in your dealings with the small business owner. Small businesses have many financial services needs beyond credit. Even if you process their loan application much as anyone else would, your sincere interest in their business can open the door to additional opportunities for both of you.

The back rooms of many financial services companies all do things more or less the same way. It is on the front lines, with the customer, where you make a difference -- a difference that lets you beat the competition!