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Retail Banking Branch Density Trend vs. Other Retail Industries

March 6, 2015


Celent recently published this interesting chart highlighting retail location density trends between different industries.  It raised some questions around why banking branches have increased while other retail industry locations have not.  Are banks not adopting digital channels as readily as the other industries?  Are there differences in how consumers interact with banks vs. other industries that help explain this reverse trend?  Is it some combination of both?

A trend that further complicates these questions is the decline of teller transactions in the branch, as reported by FMSI’s Teller Line Study.  With transactions significantly declining in the branch over the last twenty years, one might assume there would be less branches.  Of course sales and operational costs are two separate issues, but can industry branch sales sustain the huge costs associated with a growing branch network—going into the digital-driven coming decades?

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