Large corporations have some inherent advantages over smaller companies. They can achieve better scale on inventory purchases, and more favorable terms from vendors. Large companies also have a larger cash cushion to withstand hardships, unexpected blips in revenue, and anything else in the realm of the unforeseen.

Small businesses do have some secret weaponry, however. They have the value of strong personal relationships – with their customers, their employees, and within their communities. One relationship that many small businesses fail to maximize for their benefit is with their banking partner.

This can be especially true when a small business owner banks through a megabank; a multinational bank isn’t turning anyone away to be sure, but they also have little incentive to really learn about the small business owner’s particular situation, goals, and current circumstances. The small business owner is largely left to their own devices, and this can have heavy impacts on their company’s ability to stay agile in the complex economic climate seen today.

In CNBC/SurveyMonkey’s most recent Small Business Survey of business owners, respondents reported overall confidence dropping, as fears of inflation and supply chain issues remain and fears of a recession are rising. Just 22% of respondents felt that the inflation issues plaguing businesses over the past year have reached their peak. In addition, over half of respondents felt that recent tax and regulatory changes could negatively impact their business results in the next year.

Agility is Key to Competitiveness

It is more imperative than ever for businesses of any size to have flexibility and agility – around how they take payments, how they make payments, get access to working capital, and increase their footprint through equipment and real estate additions. These tend to be the “squeeze points” for today’s small business owners, taking away valuable time from the business owner’s wheelhouse – running and growing the business they built from nothing. They are also the best way to make sure a small business can adapt to a rapidly-changing environment.

There is an inherent desire from any business owner to avoid overextending the company financially, take on debt or create future obligations. Yet there is a lesson to be taken from their large company peers, as corporations utilize debt quite liberally, and are happy to pay some extra financing costs in order to gain faster and wider access to customers and markets.

A Self-Inventory For Business Owners

Does your company have a treasury management strategy? Have you explored ways to get liquidity out of accounts receivables and outstanding invoices? Do you have a full breadth of merchant services to allow customers to make payments in multiple ways – and for you to process them quickly?

These are just some of the agility-increasing functions that a business owner with a solid track record should expect from their banking partner. If that banking partner is hundreds of miles away with a global footprint, there’s little incentive for them to learn about your business or help you strategize about how to make it grow in both size and resiliency.

The economy may not be smooth sailing – inflation and supply chain issues are very real, and have decreased margins for companies of all sizes – but U.S. gross domestic product and consumer spending are still rising as the 4th quarter of 2022 approaches. Small business owners should look to lean into their secret weapon – close ties to customers and the community – and add some financial armor as 2023 approaches.

Forging Ahead With a Local Presence

There is no need to be denied the same financial flexibility that corporations have, and today’s community banking leaders are ready to sit down and find creative financing solutions that accelerate growth plans, increase reserves, and remove barriers to entry into new markets.

In a climate where inventory costs, labor costs, and the economic outlook are all cloudy, a close-knit banking relationship can be the rays of light needed to forge ahead. A good thought experiment is just for a business owner to ask themselves some top-level strategy questions, such as:

“What opportunity would I go after if I had twice as much working capital?”

“Where would I locate my business if the upfront cost wouldn’t hamstring the company?”

“Would I enter new markets if I knew I could accept a broad array of digital payments promptly?

Managing the day-to-day operations of the business consumes so much time and energy that often the strategy sessions, the dream-boarding, take a permanent backseat. This is where a trusted banking partner can step in with an invaluable role – to pull those dream scenarios front and center.

The ability to be agile and adaptive may be more important over the next year than at any time over the past decade. Uncertainty is an unavoidable part of doing business in any climate, but a strong banking relationship can clear away some of that uncertainty, allowing the business to thrive on its merits and compete with peers of all sizes.