Phoenix Synergistics: Building and Enhancing Financial Relationships with Small Businesses

June 2018 | Relationship Tactics | Importance of Household Relationships | Retention Strategies; Blunting Fragmentation

There is so much to like about the small business market.  It’s large  – 28 million businesses – and its usage of financial services is strong and broad with continuing opportunities for growth. Additionally, small business relationships go beyond the needs of the business and extend to the personal needs of the owner.  It is essential for financial services providers to develop and enhance their relationships with the important small business market as competition is threatening in a variety of ways.

For many years, it was believed that offering credit to small businesses was the entry point to small business relationships.  Today, it is generally recognized that the checking relationship is the foundation of small business relationships.  In addition, the financial needs of small businesses can extend to a wide variety of products and services as the business grows.  The availability of digital channels can play a major role in building and enhancing relationships. Innovative services such as remote deposit capture and new options for card acceptance offer small businesses new ways of conducting business. At the same time, traditional channels like branches and relationship managers can be important in serving the needs of small businesses. In some instances, remote relationship managers are being implemented to address the high cost of face-to-face contact.

Financial services providers must evaluate strategies for developing, enhancing, and retaining relationships with small businesses.


  • Examine the scope of the main provider relationship in terms of the types and number of accounts and services used by small business customers. Assess the impact of relationship pricing in these relationships. Examine the role of relationship managers.
  • Explore the degree of overlap between business and household financial relationships among small businesses. Prioritize the motivations or perceived benefits of overlapping business/household relationships.
  • Assess the experience of small business customers with relationship reward programs linked to their financial accounts and services – both for business and household relationships. Measure the value of these programs.
  • Evaluate the onboarding experience of small business customers with their main checking provider in terms of the number and types of contacts received. Gauge the effectiveness of this in selling additional accounts and services. Examine other cross-selling experiences small businesses have had with their main financial provider.
  • Determine the factors important to small businesses in selecting a financial provider. Assess satisfaction with the main provider – overall and in terms of features and attributes. Capture NPS and other loyalty measures.
  • Profile the channel behavior of small business customers – in terms of routine activities, customer service, and account opening – and examine the relationship implications of this activity. Assess reaction to innovative online/mobile tools for contacting relationship managers or other representatives.
  • Identify small business traits or descriptors – such as annual sales volume, business sector, number of employees, or years in business – that financial providers should focus on in developing strategies for expanding relationships.

Survey Topics

  • Provider Relationships
  • Relationship Tactics
  • Overlapping Business/Personal Relationships
  • Relationship Managers
  • Onboarding/Cross-Selling
  • Channel Usage


National Internet Survey – The survey will include 800 online interviews with owners and executives of small businesses with annual sales of $50K to $5M.  Industry categories include manufacturing, wholesale, retail, and services.

Key Dates

March 23, 2018 – Final acceptance of client comments on the questionnaire.

March 23, 2018 – Charter fee date.

May 2018 – Initial results available.

June 2018 – Project Report available.

In the 2015 Phoenix Synergistics survey, Small Business Relationship and Retention Strategies, findings revealed that more than four in ten small businesses with multiple checking accounts had checking accounts at institutions other than the company’s main FI.

How can your organization help blunt the fragmentation of its small business relationships?

In the same 2015 Phoenix Synergistics survey, findings revealed that close to one-fifth of small business respondents switched providers in the past two years, which was a slight increase from one-tenth in 2013.

Has this pattern of increasing small business relationship volatility continued?



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