Edward Poll, The Daily Record Newswire
The term relationship is not necessarily a word that you might automatically associate with your work life. But relationships are very important in the business of law. There are relationships with associates, relationships with vendors, and relationships with clients. One relationship that might not come immediately to mind but that is very important nonetheless, is your relationship with your banker. And as with any relationship - business or otherwise - having a strong lawyer-banker relationship means that you need to pay attention and invest a little effort to maintain the kind of ties that bind over the long term.
Educating Personnel
The relationship between lawyer and banker needs to be open and candid and built on trust. Good bankers are creative people who will find ways to assist their good customers. But bankers can be even more creative if they understand the lawyer's goals and business, which requires you to maintain an ongoing process of education with your banker. Over time, the banker can become a valuable source of information, advice, and new business referrals. To grow the relationship from the outset, you should make your bank deposits personally until you get to know the bank personnel. Continue efforts to meet with the branch manager, the operations personnel, and the loan committee - the people who can help you most. Only when you are on good terms with your bank's personnel should you either bank by mail or allow someone else in your office to make deposits for you.
Negotiating Fees
Cash management and administrative services come at a price. Many firms don't realize that banks can be flexible on pricing and will add more services at the right price if your business relationship with them justifies it. Note, however, that if a bank focuses on doing business with lawyers, it will have less pricing flexibility because it will want to treat all lawyer customers equally; in other words, you won't receive a price break that the bank does not extend to others.
You, the lawyer, must know what you value most. A bank that knows the legal industry will give you sophistication plus higher prices. A bank seeking to break into the industry may know less but have more price flexibility.
Investigating Alternatives
Even if you have a long-standing relationship with your bank, it doesn't hurt to investigate the competitive landscape. To find out what other banks are doing, talk to other lawyers, look at Bankrate.com or other resources available to law firms, or have a "beauty contest" in which you ask other banks to give you a proposal for services. Two things are essential in this process:
Make sure that you compare the same or equivalent banking services.
Make sure that there are no hidden charges for those services.
However, even if you learn that your current bank charges more for services than some of its competitors, it doesn't mean that you should automatically switch banks. Take a look at the relationship you've built over time. If another bank has submitted a lower bid for services, talk to your current bank, share the bids you received, say you value the existing relationship, and ask what the bank can do to maintain it.
Just as you would want your clients to handle a competitive bid situation in this way, it behooves you to do it with and for your bank.
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Edward Poll, J.D., M.B.A., CMC, is a law practice management thought leader and contributor to this publication. His website is at www.lawbiz.com.
Published: Thu, Jun 11, 2015
