Strategically Sharing Branch Space

woman drinking coffee with smartphone
Contributing Writer
member of Bellco Credit Union

2 minutes

As credit unions rebalance service delivery since the pandemic, renting excess square footage to another business is being reviewed in a new light.

If a credit union’s current branches have more space than they need after COVID-19 and the great shift to digital self-service, why not rent excess square footage to a paying business that offers complementary goods and services? 

Sharing excess branch space with compatible businesses will continue to be an opportunity for credit unions to gain revenue and reach potential new members, says Jenny Bengeult, EVP/director of design for CUES Supplier member Momentum, a design-build company based in Seattle. Coffee shops are popular, like the partnership between the Red Leaf Organic Coffee chain and Fibre Federal Credit Union in Longview, Washington, she notes. 

“That creates a leisure hospitality vibe,” she observes. (Buy coffee with a Fibre FCU debit or credit card and get $1 off.) A title office, a real estate office, a small legal office or a tax preparation firm could also be synergistic arrangements. 

“If a member is likely to need the services of both tenants, it’s a promising fit,” she says. 

$940 million Telhio Credit Union, Columbus, Ohio, is talking with a coffee shop in Cincinnati about sharing space in one of the CU’s small branches, reports Jessica Bing, chief communications officer. Both the CU and the coffee shop would have drive-through lanes, and the coffee shop could provide a place for a member to sit and have a cup of coffee while waiting for a meeting inside the CU branch, she points out.

Sharing space with complementary businesses was tried with mixed results before COVID-19. “Some banks and CUs are sharing retail space with coffee shops, Kinko’s, office supply vendors, even postal facilities,” explains Rolland Johannsen, senior consulting associate at Capital Performance Group LLC, a CUES Supplier member based in Washington, D.C., “but they’re doing it opportunistically—when they find a fit for a specific location—not as part of a retail strategy.” 

Sharing space with cafes, dry cleaners, travel agents or tax preparers has been tried over the past 15 years, without great success, notes Jim Burson, a managing director at CUES strategic partner Cornerstone Advisors, Scottsdale, Arizona. Some CUs have insurance agents or financial counselling services on site, he notes, either as partners or as business units of the CU. But CUs have stuck pretty close to financial services on premises. “I don’t think they’ll go too far afield just because COVID ends,” Burson says.

Richard H. Gamble writes from Grand Junction, Colorado.

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