When a bank or credit union builds a new branch, the budget usually focuses on the obvious line items: construction, furniture, signage, etc. What often goes unnoticed are hidden costs that can accumulate, potentially impacting the project’s overall success and timeline.
In this episode of the Bits Matter Podcast, host Doug Ridley sits down with William Foley, co-founder of The Element Group, to talk about the costs that rarely show up in spreadsheets until it’s too late.
The expenses often missed during initial planning
Hidden costs can show up in unexpected places. In the episode, William highlights ten common examples that, if not planned for, can lead to additional costs and a poor experience after the grand opening.
- Square footage inefficiency: Overbuilt branches waste money. Smart layouts, teller pods, and natural light help reduce space needs while maintaining comfort.
- Technology infrastructure: Networking, security systems, ATMs/ITMs, and cabling are costly if not scoped early.
- Site conditions: Soil remediation, grading, parking lot compliance, and unexpected utility connections often appear late, adding significant costs.
- Permits and regulatory fees: Zoning delays, municipal impact fees, and missed review cycles stretch timelines and increase costs.
- Furniture, fixtures, and equipment: Custom millwork, branded elements, and ADA accommodations can be easily underestimated.
- Operational costs during renovations: Premium labor for night/weekend work, or temporary spaces, add to expenses.
- Brand and marketing integration: Exterior signage approvals, launch campaigns, and grand opening promotions are often forgotten until the last minute.
- Digital signage integration: When treated as an afterthought, it inflates installation costs and weakens the customer experience.
- Staff training and adoption: Without upfront and ongoing training, staff may underuse the space and technology, reducing long-term ROI.
- Post-occupancy adjustments: Acoustics, lighting, or technology fixes after move-in require expensive retrofits. Maintenance contracts for new systems also add up.
Five ways to save costs and keep your branch project on track
1. Appoint a single decision maker
Element encourages broad involvement in the planning stage, but once approvals are made, having one person with authority is critical. Committees slow projects down. A single point of contact keeps momentum and avoids unnecessary delays.
2. Build a realistic approval timeline
Too many projects stall because approvals for furniture, finishes, and graphics aren’t scheduled in advance. Inevitably, an approval will fall during someone’s vacation or other high-priority deadlines. A clear project management timeline that factors in turnaround time helps teams stay on track and avoid last-minute scrambles.
3. In-person workshop
Element has found that the fastest way to cut weeks off a project is to bring the client team to our offices. Two days in a workshop with designers, architects, and project managers gets everyone aligned. Approvals happen on the spot, energy builds, and clients walk away confident. One client reported the trip, “saved his institution three weeks and gave his board assurance that the design was locked in.”
4. Work with an industry partner
Plenty of institutions ask, “Why not just hire a local architect? The fees are lower.” On paper, that’s true. But Element has seen the other side. Local firms can create an aesthetic design, but they often lack an understanding of branch transformation and the changing needs within the industry:
- the choreography of customers and members,
- the utilization of technology,
- staffing needs,
- and the opportunities for reducing square footage.
William Foley puts it plainly, “Find a partner that knows banking, and you avoid the constant drip of rework and misaligned decisions down the line.”
When working with an industry partner, like Element, you’re able to have everyone under one roof: strategic planners, designers, architects, construction managers, technologists, and marketers. This enables you to provide your board with a turnkey approach that includes a realistic timeline and budget upfront, rather than having to return later to request additional time and resources.
5. Waiting will cost more
Costs in this industry don’t stand still. Over the past five years, branch construction costs have nearly doubled. Boards already struggle with sticker shock, and waiting another six months only adds fuel to the fire.
What leaders should remember
- Summer and early fall is when planning needs to begin if you want accurate budgets and a smoother approval budgeting process.
- Hidden costs often outweigh the visible ones.
- Staff training and digital integration are as critical as bricks and mortar.
- A turnkey partner reduces surprises and keeps projects moving.
- Decisions made in the first ninety days of planning determine whether your branch becomes a growth engine or a cautionary tale.
Transcript
Doug Ridley: Welcome to The Bits Matter Podcast. I’m your host, Doug Ridley. And today, we’re continuing season two, a strategic approach to branch design with episode three, Hidden Costs. In this episode, I’m joined by William Foley, co-founder of The Element Group and an expert in design-build projects for banks and credit unions.
Today, we talk about hidden costs in branch projects, why early planning matters, and how a turnkey approach can save both time and money in the long run.
Now let’s get started.
So, William, let’s talk a little bit about hidden costs. Now, what costs differ from using an industry design firm versus a local architect?
William Foley: Well, an industry design firm is going to have slightly higher costs upfront. There could be slightly higher costs upfront, but they’re more efficient. And when designing the space, they understand banking. They understand backroom operations. They understand how to use technology within the branch. They understand digital and where the digital experience can be. They train the staff. Once the building is completed, they’ll train staff and also any account acquisition programs that we want to run through the digital marketing.
So we’re taking into all those considerations, and it’s going to save time and money in the long run. If you go with an expert compared to a local.
Doug Ridley: They can’t bring that turnkey approach, like we like to say we’re going to.
William Foley: Yeah. Because, you know, the turnkey is everyone’s under one roof. You have strategic planners, you have designers, architects, people that understand construction, understand technology, understand digital marketing. So everything’s under one roof. And you can go to that one firm to help you along the way.
Doug Ridley: And I can see that being from both a timeline perspective, I don’t have to pass off what, you know, the architect’s vision is to the, you know, the digital marketing team or the, you know, digital screen team. But then also it must be from, just making sure that everything just aligns long term as well, that we’re thinking not just about, oh, this is going to look great during the grand opening, but this is how this is going to function – five, ten years down the road.
William Foley: And we’re talking about that early on in the process. And all those players are in the room together. So when we’re even in the critique phase or the schematic phase, we have digital marketing in the room. We have graphic design in the room, interior designer in the room, the architect, the structural, general contractor and the project manager. So everyone’s on the same page. And we’re looking at just like when we talked about the visual, when you go into the parking lot, we’re looking at all those aspects early on in the project.
Where does where does the digital screen go? Where does the brand wall go? How does this branch function.
Doug Ridley: And we’re talking especially with the signage teams. I think there’s so much intention around that and how people are going to use it as well. So even talking with clients that they use the screens in their vestibules different than the screens in the lobby versus the screen behind the tellers.
And I think a lot of times in the past, the idea was, oh, digital signage is going to be this thing that we need to include. But people were just putting it.
William Foley: It was an afterthought. It was an afterthought. We have a lot of clients that will send us a floor plan and say, Oh, can you put digital marketing on this floor plan?
And we want to think about it early on. The digital marketing should be first in the conversation, in the graphics, in the branding.
Doug Ridley: When we talk about costs, I think the thing that comes up the most is just square footage, you know? And how are we helping clients or how are clients even saving on square footage nowadays?
William Foley: Well, the biggest thing is technology. Technology, using items, using teller pods. Smaller offices, using visual natural light, glass, just being more efficient with the design.
Doug Ridley: When you talk about some of these visual aspects of glass being more open concept, those sort of things like where are there specific areas where like that’s just an obvious for us is that you don’t need and, you know, offices can be smaller.
William Foley: Offices used to be 10 x12 and now they’re nine by eight, but they still appear to be larger because we’re using natural glass in the front. We’re putting a little natural glass on the side so it appears larger. And you know, we fully understand privacy. So we’re using better glass. So there’s privacy within the offices. So the members or the customers can feel comfortable talking about their business needs when sitting down with the banker.
Doug Ridley: You know we don’t talk a lot about it a lot. But one thing we do is there’s noise.
William Foley: White noise. We can use white noise within the facility because they are smaller. You’re going to hear things. So you use white noise or you used acoustic ceilings and things like that.
Doug Ridley: We talk about layouts, we talk a lot about too, like the choreography of it. You know, there’s just how when someone comes into the branch, how are they, where do they go if they want to open an account or just want to do a basic transaction, daily transaction, those sort of things like the choreography fees big. And I must be helpful there to understand. Here’s how we can take that choreography, make it much more intentional. By also making the space smaller.
William Foley: And that’s why we, do training. So we help train the staff to understand when a member or a customer comes in the door, what is their next move. Do they want to go to the transaction area. Do they want to open an account. So we’re helping them understand how to work the space.
Doug Ridley: It seems like with so many of the trainings that we do, it’s gone are the days that people just tell are standing behind a teller line or desk and just saying, hey come, come here.
William Foley: Well everyone on the floor has to be involved in the member experience. And that’s the biggest key. If you don’t have buy in by the staff, the branch isn’t going to be successful.
So that’s what we go back to. Early planning, like with the CEO and the branch manager and the head of retail, they need to buy into the process up front. And then once the building’s completed, that staff is going to continue to have that buy in, and then check ins. So we’ll do an initial training. We’ll check in at three months, six months, nine months, 12 months to make sure that branch is still working the way it should.
Doug Ridley: Do some secret shopping.
William Foley: Exactly. Yeah, exactly.
Doug Ridley: And we talk about hidden costs. And gosh, we spend millions of dollars doing this project, man hours, etc.. And then you don’t put that time in to say, and that was going to be successful down the road.
William Foley: That’s the most frustrating thing to me is when I go back to a branch and it’s not being used the way it should be used, and that’s because you don’t have buy in early on, and that’s the key part to being successful.
Doug Ridley: So as we wrap up, I have one more question. What pitfalls do you see when we’re working in that initial planning phase during the design strategy discussions?
William Foley: I think the biggest thing is the institution, not committing to the project and not putting an internal team with authority to make decisions as we go through the process.
Doug Ridley: So are you saying like, you know, we need to approve furniture? And then instead of having one person have that authority, they got to go back to a group of people
William Foley: and will come up with a project journey and a project plan. And we always look at, okay, we need to make sure our vendors are in line, our contractors, our architects, our consultants. Our biggest key is to make sure our client understands what they need to do throughout the project. When do I need to approve furniture? When do I need to approve graphics? When do I need to approve the merchandising?
The general construction costs. So all those key approvals, we talked to our clients early on about that and then help them along that journey. And who is the key decision maker.
Doug Ridley: I guess in that plan too is that decision maker just out on vacation that week?
William Foley: Exactly. We don’t want to do that to the client is say, okay, tomorrow you have to approve the furniture deck.
So we stay on schedule. We give them two three weeks in advance. We talk about it at the meetings, and everyone’s up front that they know when things need to be approved.
Doug Ridley: You know, and I’ve seen teams actually come to the office and do some of those approvals, get on the same page. So that way everyone sort of knows the beginning of a project or even as, you know, as we’re doing design and picking furniture and, flooring etc., that’s, hey, this is the direction we want to go. I’d have to think that that like cuts down on time.
William Foley: It’s huge. It’s, it’s the most exciting time for our company is to have people in our space. We’ll do some concept designs and the critique will get client buy in. And then once we get into schematic design and design development, we’ll bring a team from their institution here to the office.
They meet the interior design or the graphic design or the architect, the owners of the company. We all get in a room and we talk about the design and we’ll make approvals, two, three weeks savings of getting everyone here and team building and getting everyone that that connection we talked about and getting everyone on the same page. They go back to their job, we complete our design process, but we save 2 or 3 weeks doing this and it’s always a fun time too.
Oh, it’s a blast. It’s a blast. We have we have a lot of fun. But then we work hard and it’s funny because, you know, in the morning we’ll be going over designs and we’ll be, you know, strategically talking about what has to happen. We’ll go out, maybe go out to dinner or something like that. A team will stay back and implement those designs into the plan.
The next day, the client comes back and we’re reviewing updated floor plans and designs. And you can’t do that on zoom or teams, things like that. Having those folks committed in this space is very helpful.
Doug Ridley: I feel like our team gets excited about that, especially the design team, when they can say, get that feedback in person and then show people the next day exactly what they were thinking.
William Foley: It’s a blast. It’s the most rewarding part of the job, and everyone in the office just gets really excited to your point, when clients come to the office.
Doug Ridley: Well, William, thank you for joining us. Any parting thoughts to institutions as they start their 2026 budget planning season?
William Foley: Well, I think the biggest thing is work with someone that has the expertise in the design build world. If that’s what you’re looking at, have a realistic budget, a realistic timeline, and it will be successful.
Doug Ridley: And that’s a wrap on this week’s episode. A big thanks to William Foley for joining us and sharing ways you can save during your next branch project. If you’re preparing for budget season and unsure where to begin, keep in mind that costs go far beyond brick and mortar. Decisions made early from who designs the space to how technology and staff training are integrated, can determine whether the project saves money long term or creates hidden expenses down the road.
A big thank you to our producer, Bryn Baldasaro, with music by the George Brown Band.
Be sure to subscribe and stay tuned for our next episode, where we’ll dive into ways you can save on your next branch project. Thanks for listening, and we’ll see you next time.
