Retail bank benchmarking

Jon Poore

Director, Consulting and Advisory Services

Australia and New Zealand

Our survey of five major Australian banks signals how property teams can make significant savings on capital spend

Our survey of five major Australian banks on their overall capital investment strategy, spend profiles, capital project delivery model and speed to market signals how property teams can make significant savings on capital spend.

Target Design Lifecycle

Our survey revealed that target lifecycles vary significantly between the retail banks. While two of the five had a target of between seven and ten years, another two had targets of over ten years and one had no target lifecycle at all. In practice, lifecycles are often shorter than planned. This is a trend we expect to continue and intensify in some locations, such as city centres, as banks respond to both traditional and emerging competition.

This means there are opportunities for efficiencies if design standards and specifications are tailored to meet a more realistic length of store life. For instance, it may make more sense to invest in materials and design that last for five years rather than ten or 15 for flagship and high-performing stores as they are more likely to be regularly refreshed.


  • Set design standards and stick to them
  • Align standards to realistic target lifecycles
  • Build in regular design standard reviews and governance

Optimise workspace performance

The variation in the front of house area for each member of retail staff could reflect the fact that some banks are already moving towards a self-service format, although there are also differences in how companies count staff. One bank has twice as much space per fulltime-equivalent (FTE) as another. This demonstrates different approaches to realising efficiencies in the retail portfolio: reduce space or reduce headcount, or both.

Whereas for commercial fit-outs, traditional workspace utilisation looks to minimise area and cost per member of staff, these metrics are not appropriate for banking. Customer experience and how that translates into interactions with the bank are the main consideration, an area of measurement which we believe merits more attention and development.


  • Understand retail network strategy and footprint approach
  • Review FTE per store with a view to achieving efficiency savings
  • Look at transactions for each format to better understand performance

Adopt the right delivery model

Delivery models among the five banks range from all in-house at one end of the scale to total outsourcing at the other. The differing approaches are reflective of the organisation’s overall strategy towards transferring risk to the supply chain.

Where the proportion of unplanned work is higher, better planning of capital expenditure combined with stronger program management could offer opportunities to reduce costs through engaging with the supply chain around guaranteed volumes of work.


  • Reduce costs through planning and program management
  • Achieve cost efficiencies through bulk procurement
  • Encourage innovation in longer-term supply chain relationships

Get down to details

While our study showed there is a similar spend by all banks on building works and security, spending on particular elements of capital cost varied significantly, notably fitments and services. There was variation in prelims and consultants fees too.

Some of the gaps can be attributed to differences in delivery models. Design standards, aimed to deliver brand differentiation, could also be a reason for spend to vary from one bank to another.


  • Reduce costs on elements where peers are spending less
  • Strengthen brand on elements where peers are spending more