Trends Supporting the Micro Branch

Are you looking to expand your physical footprint this year? John Smith, CEO for DBSI, a design-build firm based in Chandler, Ariz., shares a few reasons why small branch spaces are worth considering.

• Every retailer wants more traffic. What retailer wouldn’t want more opportunities to know its clients via personal interactions? Micro branches enable a CU to get closer to its members – to where they work, live and play. Small facilities also let members test drive and interact with products—to see the value of those products, vs. just “reading the packaging.”
• Branch transformation. With 65 percent of the CU’s overall operating costs tied up in branch and ATM channels, it’s critical to optimize the branch channel fully. Think about hotels, fast food, airline lounges and, of course, retail. They recognized this trend way before banking and have taken actions to optimize their stores.  
• Micro branches and shared tenancy. Working together, the branch and another retailer can pull in greater traffic at typically 25 to 50 percent less cost (for example, rent, overhead, and utilities all become shared costs.) Smith explains: “When you partner with a retailer like the Tea House, as does one of our credit union clients, each of you share a portion of the footprint. In this case, the CU and Tea House each have 1,600 square feet, but combined, the two occupy a much larger footprint of 3,200 square feet. That’s where there are savings. Without the combined space, the CU would have to create a larger overall space. Instead, the two share a common area, bathrooms, etc. Traffic increases as people come in to buy tea, yet need banking services; people come in for banking services, and then buy tea and sandwiches. So, the CU can realize 25 to 50 percent less cost but often double the traffic.”
• Cash recyclers are an easy decision. They protect the cash asset, with vault-like security, but free up space for retail and more service-oriented needs, plus reduce staffing requirements. 
• Digital experience. Technology offers an integral means for branch transformation, creating a better experience while conveying the full set of products offered.  
• Virtual expertise. In small spaces, specialty services can be provided in high definition sound and picture from centrally located experts via teleconference.

With 25 years of marketing and communications experience, Stephanie Schwenn Sebring established and managed the marketing departments for three CUs. As owner of Fab Prose & Professional Writing, her new focus is on assisting CUs and industry suppliers with their communications needs.