Demystifying Small Business Banking
Small business owners are accustomed to facing more challenges than their larger counterparts, but recent years have put their signature grit to the test. Reverberations of the COVID-19 pandemic are felt in ongoing supply chain snags and staff shortages. To add, inflation remains near a four-decade high—combined with rising interest rates, the pressures on the business owners’ balance sheet are mounting.
In a testament to the appeal of small business ownership and Americans’ resolve, 2021 saw a record 5.4 million business applications for Employer Identification Numbers filed, despite these hurdles. This is great news considering small businesses play an integral role in our nation’s economic recovery and growth. Since 2015, KeyBank has proudly provided more than $2 billion in Small Business Administration (SBA) guaranteed financing to thousands of small business owners. Ranked among the top 10 SBA lenders in the U.S.1, KeyBank remains committed to supporting the small business sector by helping owners overcome obstacles and removing barriers small businesses have traditionally encountered when working with banks.
In honor of Small Business Month, we’re demystifying small business banking by raising awareness of tips and tools small business owners can leverage for growth.
This includes our new Small Business Check-In feature, just launched in April 2022 to easily help them assess where they stand financially, evaluate their goals, and discover how their bank can help guide their paths forward toward better financial wellness.
Tips for Small Businesses Overcoming Challenges
Review operating models and lean into small business “perks”
Companies of all sizes may be struggling to meet customer demand amid widespread supply chain disruption and labor shortages. When it comes to small businesses, a review of operations can shed light on areas to which owners can devote resources to meet customer demand in this challenging economic environment.
For example, a small business looking to combat a staff shortage might want to reallocate resources toward upskilling initiatives. Training programs can help a small business operate more efficiently by expanding employee capabilities and helping them envision a future with the company. To add, small businesses that adopt digital processes may be able to accomplish more tasks with fewer employees to cut costs, mitigate service disruption and enhance the customer experience.
Additionally, many workers are coming away from the pandemic with more consideration for how their job aligns with their ideal work-life balance and their personal values. In fact, findings from the 2022 KeyBank Financial Mobility Survey indicate nearly two-thirds of Americans now believe that work-life balance (62%) is more important than a high-paying salary (22%).
Small businesses are typically free from the red tape and stakeholder interests that prevent larger companies from embracing innovative practices. Small businesses are uniquely positioned to offer employees perks like flexible hours, childcare, better PTO structures, a close-knit corporate culture and business discounts.
While many small business owners may be aware of the product suite they have with their banks—i.e., checking accounts—fewer may know that their banks can provide owners with experts that serve as guides, as they analyze their businesses to meet the economic environment. Whether it be evolving their operations or understanding their unique employee “perks,” KeyBank is more than a bank to its small business clients—it’s an educated resource on piloting toward the future.
Check-in with your finances
The 2022 KeyBank Financial Mobility Survey reveals that despite the disparities in perceived financial savviness and financial confidence, Americans across the board report that the number one thing that made them feel financially resilient during the pandemic was financial information. Findings like these support KeyBank’s policy of transparent interactions with clients. We’ve been known to provide guidance and access to capital that helps restaurants turn tables more efficiently and doctors offer virtual appointments.
We’re taking this same approach with our latest tool to make these conversations and connections easier. KeyBank’s Small Business Check-In takes small business owners through a three- to five-minute series of questions about the state of their business and where they are on their financial journey. Once completed, small business owners are able to schedule an in-person meeting or phone call with one of Key’s local bankers within their market to evaluate and provide a personalized, advice-driven conversation.
Improve cash flow
Of course, small businesses that have access to lines of credit have an advantage when it comes to reviewing and revamping operations. For example, capital can help small businesses purchase inventory to insulate operations from supply chain disruption and embrace technology for streamlined service.
Here at KeyBank, we understand that the small business sector is not black and white. We don’t hold clients to across-the-board restrictions such as requiring them to generate $1 million in annual sales to qualify for a small business loan. In addition to expanding small business clients’ access to loans, we work with local organizations and nonprofits to ensure clients are aware of and benefit from all available grants and sources of funding. When they needed it most, KeyBank helped small businesses secure 70,000 SBA-approved loans through the Paycheck Protection Program (PPP).
The number of small business owners is growing and so is the body of bank-provided resources they can access to help them overcome ongoing challenges and seize opportunities. KeyBank connects small business owners to capital, support and advice through a wealth of personalized tools and services designed to demystify small business banking.