Location, location, location. It's something that interests banks as much as real estate agents, and determining where to locate branches is one of the most important decisions a bank can make. Location, after all, can affect everything from the performance of a branch to the type of customers a branch attracts.
Fortunately, technology solutions exist to help banks maximize profits by choosing branch locations that reflect their growth strategy and business interests.
"Once you figure out what your strategy is, this is how you figure out opportunities," said Jim Stone, CEO of geoVue, a Boston-based developer of location-based decision support systems. "As is often the case with multiple location companies, banks pay special attention to the location of branches, but they don't always understand why the winners are winners, and the losers are losers."
geoVue's product, iSite, helps banks to evaluate locations and make informed decisions. iSite helps primarily with branch network planning, i.e., determining where it makes sense for the bank to locate new branch offices.
"Every bank has a strategy for maximum profitability of its branches," said Stone. "We deliver a software solution that integrates maps and market data to support decisions involving branch location."
World Savings Bank, an Oakland, Calif.-based institution with 469 branches in 38 states, installed iSite in January. World Savings Bank uses the product to evaluate specific opportunities in a trade area, understand the demographic profile of customers in that area, determine how many branches a specific area can sustain, decide where to locate them, and estimate what the performance of a branch would be in any given location.
The product is available both as a Windows-based and a Web-based application, and World Savings Bank has access to both. iSite has programmed into its system locations throughout the United States, as well as some international locations. All that World Savings Bank needs to do is enter an address, and the software automatically find that location on a map along with information about the vicinity, such as the location of nearby shopping centers, retail businesses, and other employers.
In addition, the program determines pertinent demographic information, such as population, income, neighborhood boundaries, and other factors.
iSite's maps also display drive times to and from a particular location; these drive times are a way of determining accurately how long it takes people to reach a certain location, taking into account factors such as landscape features, roads, and traffic flow patterns.