5 Questions to Ask About your Business’s Treasury Management Services

Every business is unique and formed by many organic influencing factors. Shouldn’t a business’s treasury management be approached organically, too? The best treasury management officers will listen to your business’s story and find its nuances. Instead of offering a one-size-fits-all approach, they’ll learn the ins and outs of your operations before recommending a plan of action.

Finding an Ideal Approach

Selecting treasury management solutions is an important decision, and certain organizations need to focus on some service areas more than others. Maybe you need to better handle risks and controls in treasury operations or implement tools such as remote deposit capture, lockbox, or automated clearing house services to assist with cash flow. At American Bank of Missouri, we tailor our services to ensure they’re a fit for each client.

In our first conversations with you, we want to understand pain points with your existing payables and receivables processes with your current bank, what you’d like to spend less time doing, and what you think is working currently. We won’t suggest anything until we understand your specific situation. That understanding gives us the flexibility to develop a treasury management system appropriate for your budget and goals.

5 Goals of Treasury Management Systems

All business management processes should achieve some common overarching goals while fulfilling specific functions, and treasury management is no exception. Does your small business’s treasury management process satisfy those basic objectives? Ask these five questions to gauge whether your treasury management is up to par:

  1. Does it save time and money? Your focus is likely on running your business in the most efficient way possible. Your bank should make that easier, not more difficult.
  2. Does it add convenience and security? Your bank should be equipped to provide the most cutting-edge technology and security, such as fully secured online banking. Besides this, it should allow you the personal access you need to resolve questions and problems with ease.
  3. Does it increase efficiencies and productivity? The last thing you need is for employees to take time out of their busy days to figure out how to deposit checks, update their banking information, or field paperwork sent to your administration team. An effective treasury management system ensures these processes are seamless.
  4. Does it maximize cash flow and liquidity? For your business to grow, you need to know exactly where your cash flow stands in real time. Finding a bank that can process your payables and receivables quickly frees up time for you to identify the best areas for investment in your business.
  5. Does it minimize risk? Your banking should be reliable, stable, and accountable to what you and your business strive for. Because every action you take will tie back to your mission, having a personal relationship with a well-equipped bank goes a long way.

If you answered “no” to any of these treasury management business objectives, our full lineup of services could bring your processes up to speed. If you’re not sure about how effectively your current process meets overall objectives, we’re ready to listen to the details of your situation and help you find answers. Reach out to the American Bank of Missouri branch nearest you to get started or call our treasury management department at 636-745-3174.

How Different Businesses Manage Cash Flow

At American Bank of Missouri, we understand the nuances of small business’s cash flow management and take it seriously: Studies demonstrate that most businesses fail due to cash flow issues alone, and these financial problems often stem from simple errors and mismanagement.

Let’s say you’re a logistics company facing a treasury management problem: One of your business partners isn’t endorsing checks when making remote deposits. Due to this, the deposits won’t post to your account, and the disruption in your cash flow timeline leads to frequent headaches.

Luckily, you have a great treasury management partner that quickly identifies the issue. In this case, your partner’s bank doesn’t educate its clients on how to use the deposit function properly. To fix the issue, your bank suggests electronic-only deposits, as it would eliminate human error.

Because this issue could’ve caused problems in other areas of your business, it’s a good example of how cash flow problems can eventually lead to a business’s failure.

Again, most banks offer treasury management services, but a lot can go wrong without individual attention and guidance from a trusted banking partner. The best banks will not only put secure treasury management services and products at your disposal, but will also show you how best to use them to ensure maximum convenience and minimal error.

This is especially important to cash flow management in, say, healthcare and medical businesses, where the timelines and needs can vary from month to month. The medical industry is a unique one, and robust treasury management requires awareness of the various factors influencing cash flow.

There’s the percentage of time doctors are booked, for example. The procedures they perform and what patients will pay during visits should also be considered. And then, there’s the matter of when insurance companies will make payments — if they pay at all. If they don’t receive payments due, that’s yet another cash flow consideration.

Complicated businesses can take certain steps to streamline their treasury management, but teaming up with banks that understand the unique nuances of cash flow in their industries (in the above case, the medical industry) can reduce reliance on outside financing. This saves money on interest costs and allows them to retain more funds for reinvestment and emergencies.

Best Practices for Cash Management

There’s no standard system for a business’s cash flow management, and the department that takes care of financials varies from company to company.

Knowledge can vary, too: At American Bank of Missouri, we work with treasury managers who are very knowledgeable about the treasury management services and products they need. On the other hand, we have clients with little to no knowledge of how to manage their business’s cash flow. If you’re in the latter category, we’re happy to provide guidance.

First, we’ll talk to you about how you manage payables and receivables. That gives us an idea of which treasury management services will most benefit you. Then, we can show you how that recommended suite of services can save you money on internal costs and labor.

Your small business’s treasury management duties might be allocated to you, a spouse, or an assistant, but larger corporations will have a controller, an accountant, or a bookkeeper watching over cash flow. It all depends on how much control you want. For instance, some business owners and senior-level employees often don’t look at accounts or log into their business’s online banking. Others set up dual controls so they can view every transaction.

Because the style of cash management varies from company to company, knowing how well your system functions means learning about the treasury management services your bank provides. Consider the following questions:

Does the bank’s treasury management system run smoothly and consistently?
Do funds flow in and out of your business securely and cost effectively?
How attentive is your bank when you encounter an issue?
This isn’t an exhaustive list, but it’ll give you a good indication of how effective your bank is.

Additionally, the answers to these questions might change over time as your business evolves and your cash flow management needs change. A company with, say, five employees can log in to online banking and use an ACH transfer service to complete direct deposit payroll. When that business grows to 20 or 30 employees, however, it will likely need to hire a payroll company.

Another consideration is a growing company’s rising transaction volume, which might require a different type of account. If you suddenly need to deposit multiple checks daily instead of once a week, you’ll likely need a check scanner at your office (or a lockbox if the check volume is high enough).

These solutions save time and are convenient, but they also add cost. If freeing up your employees’ time is more important, however, talking to your bank about time-saving solutions is a good idea. Besides this, many businesses find that sourcing certain treasury management services to digital and automated channels is not only worth the investment, but also necessary. In a recent survey, nearly half of business owners said they expect to increase their use of ACH direct deposit via online banking in the next year.

A treasury management expert will know which solutions to implement to help you invest in other areas of your business or offset fees, all while keeping your system effective. However, your priorities might shift regarding convenience, efficiency, and saving on internal costs, so the best banking partners check in periodically to see whether you’re still satisfied with your treasury management setup.

American Bank of Missouri’s Approach to Treasury Management
Effective treasury management offers many advantages, but it also takes a personal, relationship-based approach. Unfortunately, not all banks operate with this goal in mind: A J.D. Power survey found that just 37% of small business banking clients believe their bank “appreciates their business,” and under a third say their bank truly understands what they do.

At American Bank of Missouri, we take a decidedly different approach to the treasury management process. First, we listen to your business’s story, your overarching goals, and the areas of the business that you’re most passionate about. We then explore your cash management process, delve into the specifics of payables and receivables, and pinpoint the treasury management services that would be most beneficial to your business.

We tend to ask about current frustrations, what’s eating up your time, and what you’d like to streamline. We understand that your business’s cash flow management might not be an exciting task for you, so our goal is to help you find the most seamless solution.

We also believe that relationship-based customer service is paramount to effective treasury management. We have a compact, dedicated team that handles your treasury management accounts, so you’ll receive a quick response whenever you have concerns about your cash flow. Because we’re a local bank, we also have more flexibility when it comes to customizing solutions and offering competitive pricing.

If you’re considering our services, you may wonder whether you’re following treasury management best practices or whether your current treasury management system delivers significant value. We advise potential clients to ask themselves this simple question: Does your current treasury management system save you time and money? After all, your focus is on running a cost-effective business, and your bank should make that easier for you.

Adding convenience and security to your small business’s cash flow management is another benefit of robust treasury management services and products. That means American Bank of Missouri affords clients access to technology solutions that make their work easier — such as fully secure online and mobile banking — as well as the support needed to quickly resolve financial issues.

Overall, a reliable, stable, and accountable treasury management provider helps you minimize risk and maximize your company’s growth potential. Having a personal relationship with a knowledgeable bank goes a long way here. If you’re ready to streamline your business’s treasury management processes, come talk with the dedicated team at American Bank of Missouri. We’re prepared to explore your current workflows and provide solutions.

We’ll work to provide you ease of mind.

Meet Our Treasury Management Officer

Lindsay Hurt

Vice President – Treasury Management Officer

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