Outsourcing Your CFO Versus Hiring
Could your company use a CFO but you are not ready financially to do so?
The most affordable option is to outsource the duties of a CFO. You will get these duties done without having to pay the salary, taxes and other compensation that come with hiring a new employee, especially a new C-level employee.
Financial Strategy
A CFO helps you see where you need to go by creating a financial strategy, but this can also be done by an outsourced person or team. By grabbing numbers from you that define company performance, a financial strategy can tell you how to change things so that you get a larger return on investment.
An individual CFO will only bring you one point of view, no matter how much experience they have. Also, by having your CFO in-house you run the risk of having your CFO, even though it is unintentional, influenced by office dynamics.
By outsourcing to a company like AWK FINANCIAL, you’ll have immediate access to multiple people who can execute the responsibilities of a CFO and who are always looking on the horizon for how things are changing to improve your return on investment (ROI). They are more likely to be able innovate than a single person.
Budgeting
By getting someone from outside your company to do the budgeting, you are more likely to get a workable budget rather than one that has a bias towards a certain area of the business.
A team will also be able to bring you alternative vendors. This means new resources that will help your bottom line. The alternative vendors can bring you lower prices and potentially better service than the people you have now.
Financial Suite Design
In all likelihood, you’re already outsourcing your financial suite design, either to an individual or to a software company.
An outsourced CFO team can help you design a financial suite that meets your company’s specific needs. While generic financial software can often suffice, the larger or more complex your company is, the more you need to have a financial suite that meets your specific needs.
A custom-made financial suite will allow you to generate reports that meet your company’s needs. Being able to drill down on your company’s finances in a very specific and detailed way will allow you to increase profits.
Bookkeeping and Accounting
Bookkeeping is the day-to-day tracking of sales and cash. It’s important that this happens every day. If there is an error, it can result in significant losses in short order.
Accounting is the interpretation of your financial data. While this is the generally accepted concept of a CFO, it’s often the part of the job that everyone fears to outsource. As was pointed out above, an outsourced CFO can often provide better information and create better plans by virtue of the diversity of their experiences.
When does it make sense to outsource your CFO?
In truth, every business should have a CFO. The CFO’s advisory position is invaluable to companies of all sizes.
Small business - Even if you’re a single operator, a CFO can guide your growth, your sales, and more. The CFO role will help guide through everything from the first stages of growth and handling things like taxes to hiring new staff and much more.
Medium-sized business - A business that have already begun the growth process can often find themselves stagnating. A CFO can help to guide the next stages of growth. This type of advice can help to guide the assets that the organization has now to leverage them to the next stages of growth and profit.
The cost of a CFO might seem excessive to many smaller businesses, but by using the resources and experience of an outsourced CFO, that strengths can be had for much less.
For more information about how an outsourced CFO can help your business contact AKW.