Let me tell you about John, the owner who never audited his rates. John is the founder of a successful software-as-a-service company that offers an innovative auto product. He was so focused on building his product and serving his customers that he never thought to review his banking fees. Over a span of five years, John forfeited nearly $10,000 in avoidable fees simply because he never revisited his automated clearing house charges.
Now, consider Jennifer. She runs a cutting-edge robot technology company and made it a point to revisit her banking rates every two years. When she approached her bank with clear data and well-articulated goals, the bank agreed to adjust her fee structure. As a result, Jennifer saved $10,000 that would have otherwise gone unnoticed in her expense reports.
These stories are reminders that reviewing your banking relationship is not merely a financial check-up; it is an opportunity to reclaim money that can be better invested in your business. The savings can be significant, and the process is surprisingly straightforward. Here is how you, as a business owner, can take control of your banking relationship and ensure that you are not overpaying on fees.
Why Revisit Your Banking Relationship?
Every year, businesses evolve, and so do their financial needs. Banking fees, rates, and service offerings may change, sometimes without you even noticing. A proactive review of your banking relationship helps you:
- Save Money: Identify hidden fees or outdated rate structures that no longer serve your business.
- Improve Cash Flow: Lower fees directly enhance your bottom line, giving you extra cash to reinvest in growth.
- Strengthen Negotiation Leverage: A well-informed discussion with your bank can lead to better terms, lower fees, or customized solutions that match your current business size and needs.
By regularly reassessing your banking relationship, you can avoid the pitfalls that caught John unawares and join the ranks of savvy business owners like Jennifer.
Step-by-Step Guide to Reviewing Your Banking Fees
Step 1: Gather Your Financial Statements
Begin by collecting all relevant financial statements and fee schedules from your bank. Look for monthly statements, annual summaries, and any documentation that outlines your current fee structure. Organize these documents by fee category (for example, ACH fees, wire transfer fees, account maintenance fees, etc.).
Tip: Create a simple spreadsheet where you list each fee category alongside the amount you have been charged over the past year. This will give you a clear picture of your total costs.
Step 2: Compare Industry Benchmarks
Research standard banking fees for businesses similar to yours. There is a wealth of information available online that compares fee structures across different banks. Look at industry reports, consult trusted financial websites, or even talk to peers in your network. Knowing the benchmark will empower you to determine whether your current fees are competitive.
Tip: Bookmark a few reliable financial comparison sites and schedule an annual check-up as part of your routine business review process.
Step 3: Analyze Your Usage
Examine how you use your banking services. Ask yourself questions like:
- How many ACH transactions do I process in a typical month?
- Do I frequently use wire transfers or other premium services?
- Are there services on my account that I rarely or never use?
Understanding your usage can reveal opportunities for cost-saving. For example, if you are paying for a service you barely use, you might negotiate to have it removed or replaced with a more cost-effective option.
Step 4: Prepare Your Case
Before approaching your bank, compile your findings into a concise summary. Highlight areas where you believe you are overpaying, and be ready to show how your business has evolved over the past year. Include your usage analysis and industry benchmarks to build a compelling case for a rate reduction or fee adjustment.
Tip: Write down your key points and practice your pitch. A clear, confident presentation can make a significant difference in the outcome of your discussion.
Step 5: Initiate the Conversation
Contact your bank and request a meeting with someone in the relationship management or business banking division. During the meeting, present your analysis calmly and professionally. Explain that you are seeking a review of your fee structure in light of your current business needs and market standards. Remember, it is perfectly acceptable to ask for a rate reduction; banks are often willing to negotiate to retain valued customers.
Three Essential Questions to Ask Your Banker
- “Can you walk me through my current fee structure and explain if there is any flexibility to reduce costs based on my usage?”
This question opens the conversation and shows that you have done your homework. - “Are there any new products or services available that might better align with my business needs while lowering overall costs?”
This demonstrates your openness to evolving your banking relationship for mutual benefit. - “How do my fees compare to the industry benchmarks, and can we adjust them to be more competitive?”
This question leverages your research and provides a basis for negotiation.
The Prosperitee Advantage
Reviewing your banking relationship is a proactive step toward smarter financial management. At Prosperitee, we understand that as a business owner, your time is valuable. We provide not only expert bookkeeping and financial insights but also strategic guidance that can uncover hidden savings. Imagine having a partner who regularly audits your financial relationships, ensures that you are never overpaying, and negotiates on your behalf—all while you focus on growing your business.
If the process of reviewing your banking fees seems overwhelming, let Prosperitee handle it for you. Our experienced team is ready to ensure that you get the best possible terms, so you can reinvest the savings back into your business.
Take a proactive stance like Jennifer and avoid the costly oversight that John experienced. Revisit your banking relationship annually and discover the hidden potential in your financial operations. With a little effort and the right partner, saving thousands of dollars might just be one conversation away.
Ready to simplify your financial management? Contact Prosperitee today and let us help you take control of your banking relationship.
