5 simple strategies to build your business
Whether economic, market or other, disruptions in business are inevitable; they’re a constant. The variable, however, is how your business prepares for the inevitable and you respond when faced with challenge. It’s where you have some control. The right action can help you spot the potential, explore new possibilities and grow—or, at the very least, weather the storms and clear the hurdles ahead.
Here are some strategies to ensure your business is prepared for those everyday challenges and opportunities, as well as those tectonic shifts in the business landscape that can easily make or break a business.
A business that’s prepared is likely to find themselves already on the right path to flourish while others are facing a need to pivot and transition their current operating model. It helps to always be learning about your market and the economy while staying on top of the needs of your customers and coming up with creative solutions to meet those needs. Maybe it’s changing up a product line, reexamining operations or, for those storefront operations, adopting a digital presence to get in front of more customers.
Creating a digital presence helped Scott Hedrick score a homerun for Kansas City, Missouri-based Pro Athlete, the nation's largest online dealer of baseball bats. He joined the family owned business in 1987, eventually taking over as president. Instead of adding more brick-and-mortar stores, Hedrick decided to take the business online. Today, from its 55,000-square-foot headquarters, Pro Athlete operates six e-commerce sites, selling every Major League-approved bat and glove available.
Hedrick’s banking partner, Commerce Bank, has provided the technology and solutions to support the growth of his online operation, saving Pro Athlete time and money on its day-to-day banking needs. “The thousands of bats and gloves we sell each year are paid for with checks, credit cards or PayPal,” says Hedrick. “It's great to have a bank that brings us ideas on how to better manage these transactions as we grow.”
Consistency in your financial operations go a long way in helping position your business for future growth, without taking on excessive risk. It’s imperative to keep a close eye on your company’s cash flow, since mismanaged finances can lead to business failure. By monitoring the funds coming in and going out, you can improve your cash position. The stronger that position, the more leverage you have to move quickly on an opportunity, get out from something that’s dragging you down, or continue to prepare for what’s ahead. Make it a priority to explore tools that make cash flow management easier.
Nebraska Medicine, for instance, recently reduced its patient debt load from $10 million to $2 million by using Commerce Bank’s no-interest Health Services Financing (HSF®) program. In addition to improving cash flow, the health system has slashed printing, mailing and labor costs associated with in-house program administration, says Sheila Augustine, Nebraska Medicine’s director of patient financial services. She credits the HSF® program’s lower-than-average default rate to Commerce’s strong credit culture.
Another popular tool, provided by Commerce Bank, is a controlled disbursement service, which gives you up-to-date insight into funding needs to better control payment planning, help avoid overdrafts and put a business’s surplus cash to work more productively.
“We didn’t realize all that we had been missing until we moved our business to Commerce in 2011,” Hedrick adds. The bank also refinanced the loan on the new building Pro Athlete built in 2010, saving the company $200,000 in interest costs.
Be a problem-solver
Imagine this collections challenge: You’re a nonprofit hospital serving many uninsured patients, as well as cancer patients—both of whom have larger than average out-of-pocket expenses and limited financial means. Your cash flow means being able to care for more patients who need treatment. So, how do you collect on debts from patient care?
That was the dilemma facing officials at Hackensack University Medical Center. For years the hospital, which serves greater New York City, tried to be accommodating, offering patients with limited financial means up to 12 months to pay. Patients who defaulted were referred to collection agencies, often leaving Hackensack University Medical Center with significant sums of uncollected debt and putting patients and their families in a further financial bind.
Hospital officials needed help solving this problem. They turned to Commerce Bank, which seemed built for this kind of challenge. The bank offered a consultative approach as well as a solution in the form of an extended loan program. Now patients can finance their hospital bills with no-interest loans from Commerce Bank. Patient stress and bad debt at the hospital are both down.
“Commerce succeeded in creating a solution that is both patient-friendly and hospital-friendly,” says Anne Goodwill Pritchett, senior vice president of revenue cycle operations at Hackensack Meridian Health, the parent organization of Hackensack University Medical Center. “Serious illness is hard enough. Patients and families are worried enough about treatment. The HSF® loan takes away their financial concerns. It’s a relief for them to know they have a way to pay.”
A strong business doesn’t get there by accident - strong relationships are usually behind that success. Develop those relationships with employees, vendors, customers and financial partners. Having a shared history builds connection, familiarity, understanding, and ultimately, a vested interest in your business. This is where consistency comes into play, too.
For example, while some businesses may jump from bank to bank looking for the best rates, there are benefits to having a long-standing, consistent relationship with your financial provider. With a deeply rooted relationship, you’ll find your bank should provide valuable insights and solutions you may not even know you needed.
Nebraska Medicine has had an ongoing partnership with Commerce Bank since 2004, when they became the first health system in the country to implement the bank’s electronic accounts payable card program.
“Commerce is a great partner,” says Augustine. “They made implementation easy, even providing IT resources with setup. Everything about their approach is professional.”
Officials for the City of Richmond Heights also attest to the value of relationship banking. "The fact that Commerce is able to focus on our municipal needs is important because they can come up with ideas that we haven't thought of because they've seen it from another municipal point of view,” says Sara Fox, the city’s finance director.
Adds Jerry Rohr, chair of the city’s police and firefighter pension fund: “First of all, they've been very receptive, very accommodating, and I couldn't be more appreciative of how well they've managed the portion of our portfolio that they take care of. Year after year, we see the same faces so there's a familiarity, a comfort level and also a level of expertise that we appreciate.”
When you’re prepared and resilient in business, you can be proactive instead of reactive, think carefully about your options, find solutions to challenges, pivot when necessary, and position your business to thrive and often realize greater opportunity.
In being proactive, it’s important to seek out the expertise from professionals built for this kind of work, especially in your banking partner. Be sure they have extensive knowledge and experience helping other businesses during any circumstance. Commerce Bank, for instance, is built to help businesses be prepared, proactive and resilient. The bank has invested heavily in people, products, technology, services and culture that allow it to be calm, versatile, confident and innovative. Having a bank at your side who is primed and ready to make your goals their goals goes a long way in creating a powerful partnership and long-term business success.