Experts say that ultimately branches still serve the basic needs of member convenience and go a long way toward fostering relationships with the community at large and with individual members.
"Branches are becoming significantly more about relationships, and that trend is going to be even more important in the next five to 10 years," said William Bily, vice president of design at design/build firm DEI, Inc. "One of the biggest trends is dialogue banking and what it has done in our business will be the single largest change in the delivery methods in the financial industry. Over half of our new clients are realizing that to get the consumer market share people need some connection, particularly when it comes to money and finance and that is the branch."
He added that by leveraging the whole automation of transactions through the Internet, ATMs, and in-branch cash dispensers, the credit union branch can now be a destination place of relationships and more of a financial advice resource than a transactional center.
"Take away the traditional barriers of a teller line and members-even the senior citizens feel closer to the financial institution," said Bily. "What older person doesn't want a conversation? The openness personalizes the experience, and we've found that the majority of older members don't object to the dialogue approach and for many it helps bring them right into the branch."
HTG Architects Partner Jeffrey Pflipsen added that such branch components as Internet stations, bistro-style seating areas and creating a warm inviting atmosphere will continue to help credit unions differentiate themselves from other financial institutions.
"We live in such a fast-paced society that when you walk in and see those bistro-style chairs and if the colors and material used in the space help create a welcoming and comforting environment where members can sit an extra five minutes to do text messaging or drink a cup of coffee, it will go a long way to creating relationships and relationships are everything," said Pflipsen.
Experts agree that depending on a credit union's strategy and ability to build convenience, branches will continue to be important. According to Pflipsen, looking at categories such as efficiencies, using the facility as a marketing tool, going green, cross selling and retail merchandising a branching opportunity is knocking for credit unions.
"With perception out there that big banks are having some issues, we believe there is an increased opportunity for these credit unions to be able to grab new members if they have the guts to take advantage of it," said Pflipsen.
For example, he said, now is the time for credit unions to see how their branch network can be more efficient, reduce operating costs and really look at and evaluate existing facilities that are 30 to 40 years old.
"Those buildings can cost a lot of money to operate with everything from loss of heat through the walls and roof, to the credit union only occupying a portion of the space," said Pflipsen. "Credit unions may find that relocating to better locations may serve them better. It's a matter of looking forward at the whole branch network and recognizing that there are a few really good branches in 'A' locations, others in the middle that are in good locations but are performing well, and one or two bad locations that closing or relocating in the right community can help the bottom line in the long run."
Both agree that sustainability will continue as a growing force in branch concepts as credit unions decide how green they want their branches to be. They also anticipate more credit unions will be seeking LEED certification for future branches.
"I think it is almost going to be a requirement," said Bily. "The trend has such a strong foothold now and many cities mandate it that it is becoming something built into the building code. With recent developments in Washington for alternative energy, I can see it becoming not unlike the Americans with Disabilities Act. It used to just be recommended, then slowly each city adopted it and it became federal law."
Pflipsen explained that with so many green products available, including paints, flooring, building materials and lighting, sustainability is becoming not only a more affordable and viable option, but many credit unions are viewing it as just the right thing to do.
"With the economy the way it is, now is the time for those credit unions that can to position themselves to move ahead with branching and take advantage of the opportunities that exist in terms of lower construction costs," said Pflipsen. "Be competitive now so that when the economy comes around your credit union will be in the right position to take advantage of it."
Bily added that with all the mergers there will be a surplus of old bank buildings, and that presents credit unions with an opportunity to get key branch locations and nice real estate deals.
"Focus on strategic planning for the future instead of jumping before looking into it. That is the key. Don't sit on the sidelines just waiting," said Bily. "Now is the time to figure out what to do and how to create opportunity. If you wait six months you miss out and your competition gets a jumpstart."