Not all small businesses have the budget and bandwidth to justify on-boarding a full-time Chief Financial Officer (CFO). CFOs are experts in financial matters, but their daily insight comes at high price.
A recently common solution to the expensive CFO is outsourcing part-time CFO services. A part-time CFO gives companies expertise, insight, counsel, and guidance when needed, which is typically all that is necessary when a company is just getting on its feet and beginning to grow.
Here is what you can expect from a part-time CFO:
- Experience with a financial consulting firm. You can expect that your part-time CFO hails from a finance or business consulting firm, rendering their experience robust and well-rounded. The more projects and variety of industries the CFO has worked on, the more perspective he or she will have when it comes to consulting you throughout financial goals and objectives.
- Establishing and getting to know the break-even point. All companies have a break even point – the point at which sales are numerous and lucrative enough to cover all business expenses. At this point, the company’s financial standing is neutral and all sales thereafter become profit. The break-even point is the most critical element to understand in business, and the part-time CFO’s primary job is to acquaint leaders and employees with this number. Getting employees on board with understanding the break-even number will motivate sales, marketing, advertising and all teams that contribute to making the company money. If your business is new with plans to grow, discuss projections with your part-time CFO. You can go over which departments are financially feasible now or in the near future and which ones require a different break-even point. Now is the time to discuss your future financial endeavors with the CFO; their guidance is invaluable!
- Draw receivables and payables closer together. Ideally, receivables come in before payables, although this scenario is so ideal, it’s unlikely. Still, a part-time CFO will work with you to lessen the length of time between receivables and payables. The day-to-day of most executives is too hectic to monitor when money is coming in or going out, but it’s an important element in motion to monitor diligently.
- Understand your margins. Margins mean more than the numbers they display at face value. A part-time CFO will work intimately with your margins, monitoring them, managing them, safely manipulating them to better understand their significance. All insight extractions will then be relayed to executives in hopes that goals are set to improve margins minimally yet significantly.
- A brief introduction to your business and team. Although your part-time CFO will not be around daily or for a long time, it’s important to establish a solid relationship foundation. Invite the CFO to company lunches and meetings so you can get to know one another better and build trust. Establishing trust early on is incremental in fueling the best job done by the part-time help. Speaking of trust, let your part-time CFO get to know all aspects your business; this is the best way for them to thoroughly understand the situation at hand and find ways to best propel you into success.
Could your company benefit from a part-time CFO service? Reach out to Quantum FBI to learn more about the financial services and software we offer. Take your business to the next financial platform by opting for a consultation with our team today.