Yes, a bank can assist

Photo: Garibaldi Glass/CWB

—Sponsored article by CWB

Where do you go when you need extra help with your business? Have you considered your bank? It may seem like an odd approach to look to your bank for business advice, but the advisors you work with on your business’s finances are working with other business owners every day and listening to their needs. In my 25 years of working in the banking industry, I’ve been able to help a lot of businesses solve operational problems and find ways to add better value to their companies — sometimes in ways that have nothing to do with where to deposit funds.

Helping with staff retention 

The number one issue I’m currently seeing across the manufacturing industry is staff retention. A dollar or two difference an hour can prompt some of the best team members to move to another company. The wage difference may not seem like much, but this is a market segment with tight margins and fierce competition.

There was one company who approached me with this very issue. At the current time, until they completed some large orders, they couldn’t afford to pay any more to their staff in wages. But the turnover was affecting business and production, and putting the contract fulfillment at risk. There didn’t seem like anything to offer until I asked about staff benefits. That’s when we spotted an opportunity.

We realized that staff didn’t have a Group RRSP Plan set up with the company. We worked through the financials and discovered that a matching program was something new that could be offered to staff. The company announced to staff it would be implemented the next fiscal quarter end, with both current employees and new hires receiving it very well. In the end, what netted out better staff retention for this company went beyond wages, and we were able to help spot this potential benefit and earn the business owners goodwill with their employees.

Upgrading and maintaining manufacturing machinery

In addition to labour, another important area that this industry needs to invest in is machinery. Improvements and advancements in manufacturing machinery are constant and being out of date can result in the loss of clients, missed markets, or not being able to ship out goods on tight deadlines. Not to mention the maintenance and repairs needed on much of this machinery. That’s lost time and money from halting operations and paying to get the equipment back up and running as quickly as possible.

A cash management strategy can help with making sure the funds needed for upgrades and repairs are readily available when you need them. Setting up a system of investments in business savings or flex notice accounts can help secure funds and add interest to the capital invested while keeping all the funds liquid so they’re available when it’s time to purchase or service your manufacturing gear. This may also help you avoid taking on additional debt at inopportune times.

Business strategy 

One of my favourite parts of my role with Canadian Western Bank (CWB) is helping our clients with their business strategies — mainly because it’s never just me helping out. When we meet with a new client, we amass a team of advisors from across the bank to look into the business and see where we can add extra value as a service. And it always starts on the warehouse floor.

We can look at spreadsheets all day but that won’t tell us how the business is actually operating. It’s not until we can see first-hand how the day-to-day operations run that we can get a sense of the full business and what cash management and lending strategies could benefit them. The insights we glean from seeing the business run for ourselves provides us with a view that the business owners may not be seeing, and we can provide a service that they would never expect to find so much value in.

A business owner might come in asking for a business line of credit, when really they would benefit from specific equipment financing options. Or a business owner might ask for a separate payroll chequing account when an Electronic Funds Transfer (EFT/CAFT) facility would be more efficient and cost effective. We would never know how these businesses might benefit from a range of products and services unless we see the operations and understand them on a holistic level.

This is where a bank can really help a business. It’s not just selling a product. It’s thinking about the business in creative ways to find solutions in places where they never would have imagined looking, and saving you time and money in the process. Learn more about CWB Cash management solutions at cwbank.com/clearyourhead.

Mike Spiess is Assistant Vice President and Manager of Commercial Relationships with Canadian Western Bank.