Are You Paying Too Much For Your Vendors?
With significant movement in the marketplace regarding new technology, you could be paying for unneeded costs. Some key questions you should be asking your vendors include:
- Does your mobile banking solution require that your customer set up an Internet banking account?
- Is your check capture system the same for your teller as it is for your customer?
- Do you have more than one log-on requirement to access your systems?
- Is your vendor charging you an interface fee to integrate debit card processing platforms with their core platforms, or any third party vendor for that matter?
Before you leave your vendor or execute a new contract, it’s important to build relationships with vendors that understand your business and will have your best interests in mind. With contracts becoming more complicated, it’s easy to fall victim to vendor clauses within their terms and conditions.
Is Your Institution Due for a Core Review?
Core banking contracts should be reviewed regularly. If you are wondering if your bank or credit union needs a review, we have six things you should be asking yourself:
- Do you remember when the deal was inked?
- Has the executive that executed the contract moved on?
- Are your contracts set on auto-renew?
- Does it feel like your vendor has priced your contract in a discriminatory manner?
- Is your relationship manager absent?
- Do you feel like your technology is behind?
With technology always changing and products continually improving, it should be common practice to review vendor contracts to ensure you have the best resources for your business. If you’re finding yourself answering “yes” to one or more of the above questions, it may be time for a core review.
Things to Consider about Core Conversion
Not too long ago, institutions avoided core conversions at all costs, and only squeezed out a better deal with the incumbent vendor at the last minute. But for today’s businesses, taking the time to review and consider core conversions means they:
- Have access to better technology
- Get Significant upgrades at a reasonable price
- Find gaps between competing vendors
The decision to leave incumbent vendors for better deals is becoming easier and is trending higher. Institutions have realized that when they conduct an unbiased, fair, and competitive review, conversion becomes easy to justify. It may be not only be more convenient, but cost effective as well to convert off an incumbent vendor than to attempt to fix a broken relationship or technology solution.
Questions to Ask Your Tech Provider
If your financial institution is wondering about the price you’re paying for core processing, here are some questions you should be asking:
- Does your contract have an automatic price increase every year?
- Did you receive a notice of a questionable price increase?
- Do you have regular face-to-face visits with your account or relationship manager?
- Do you receive more price increase notices or sales brochures?
- When the account or relationship manager visited you last, were they prepared?
- Does your account manager have twenty or more other client relationships in addition to you?
If you’re receiving poor service from your vendor, you may be paying too much for their services. Building relationships with quality vendors can help your business stay profitable, reduce costs, and continue to grow.
The Copper River Group
The Copper River Group is a financial consulting firm helping community banks and credit unions manage their vendor relationships, strategically negotiate contracts, and guide institutions through core and EFT conversions.
We work for you at an affordable flat rate and guarantee to save you money on your vendor contracts.