Making a Statement (Without Losing Your Shirt)
Some financial benefits to statement outsourcing processing become apparent immediately, while others will develop over time.
Short-term Benefits
Short-term financial benefits of outsourcing statements include manual labor savings as well as discounted printing and postage rates. Banks often pay for full-time salaries and benefits to employees who handle the printing and mailing of statements. By outsourcing statement processing, they can eliminate positions, possibly re-purposing employees to other areas. For those banks in which those who process statements also have other responsibilities, freeing them up for other tasks can result in increased revenue.
Printing and postage costs include costly equipment, supplies, and indicia. By outsourcing their statement processing, banks can decrease their need for heavy-duty printers (and the imminent repair costs that come with them). Printing costs are also lower because the companies that specialize in statement outsourcing order their paper, ink, and envelopes at discounted bulk rates so that even with their mark-ups, the prices are lower than what individual banks would pay. Bulk discounts also translate into lower postage rates; while most banks might not qualify for bulk mail pricing, outsourcing companies do.
Long-term Benefits
Long-term benefits include allowances for targeted cross-selling and up-to-date programs. While at the individual bank level, changing statement programs to more updated, flexible layouts can be costly; from software research to employee training, the price tag includes myriad hidden expenses. Small to mid-sized banks might not be able to swallow that kind of expense when the financial benefits are negotiable and less than immediate. However, with statement outsourcing, banks can benefit from the most current technology without paying the price. Such programs allow for variations in marketing messages, depending on customer profiles: Aging patrons can be presented with information about retirement accounts, while young families can be invited to explore home loan options.
With many financial benefits both now and in years to come, banks can positively influence their own financial futures by employing statement outsourcing.