Does Your Company Need an Outsourced CFO?
It’s thrilling to be in charge of a company. You wear a lot of hats and gain a lot of abilities. There’s a rush of positive energy and natural trepidation when your business grows. Most businesses eventually require top-level financial leadership to help them navigate scaling challenges, expansion, cashflow growing pains, and other issues.
Business owners sometimes find themselves needing more from their data as their company grows. Owners want to see insights and reporting to help drive their firm through the next stages. Closing the books on time isn’t enough.
What could you do with more financial support for your growing business? Are you thinking about changing your prices? What about expanding your business? Do you know exactly what your gross profit margins are and how much revenue you’ll need to pay your operational expenses? Do you know what your cash flow projections really look like?
Below are some questions which may be in your mind regarding hiring an outsourced CFO and whether your company is ready for this or not.
Do you know your exact gross profit margins on every product and/or service?
Perhaps it was simple to figure these out when you were first starting out. With a minimal cost base and restricted offers, you could calculate your direct costs vs sales to get a decent estimate of gross profit margins and assess whether these covered your operational costs.
However, when your company grows, this figure can soon elude you, meaning that the data you’re utilising to make business decisions is unclear or outdated. You need to make sure you’re really earning the profits you think you’re making, especially if you’ve increased your offerings or now have personnel with varied prices and rates.
How much cash will you have in six months from now?
Did you know that the majority of small business owners are unable to confidently answer this question? Projecting cash flow and having confidence in your estimates is a major challenge for many expanding firms.
Can you afford to hire extra employees?
Every employee has a cost and a forecasted contribution to the company’s bottom line. Do you believe that adding another salesperson will increase revenue? What does this signify for the company’s overall capacity to meet demand? Single actions can have far-reaching consequences, and they can make or break your company.
Is it possible to see your entire firm on a single page?
“Yes, it’s all there…somewhere…”.
A dependable dashboard, daily flash report, and bespoke reporting can help you keep an eye on your business at all times. After all, wasting time looking for numbers and putting data together won’t benefit anyone.
Have you ever wondered if you have all of the answers? You should think about hiring a CFO to join your management team.
Your CFO works alongside your financial controller and bookkeepers, who together work as a team to bring you the necessary information in a user-friendly format.
The CFO provides you with analysis to help you understand your financial data, generating information on which you can make informed business decisions. Without a CFO, you can find yourself poring over your balance sheet, profit and loss statement, and financial predictions in an attempt to decipher what they’re telling you about your company.
Instead, you must be able to quickly understand what your financial data and reports indicate so that you can use well-informed insights gleaned from thoroughly analysed data to run your business and make the best decisions possible. Having a CFO conduct the analytic work for you while also carefully managing all of your company’s accounting operations allows you to manage your business without having to undertake the tasks of a financial controller yourself.
Benefits of hiring a part-time finance resource
Hiring a full-time, experienced in-house CFO is expensive and you may not have a full-time need. Outsourcing provides you with access to a quality individual at a cost that is aligned to your business needs.
Furthermore, you can choose the right individual to maximise performance, productivity, and compliance at the correct level for your business.
By engaging a part-time CFO, you simply pay for support as and when it is required. This allows you to invest more of your funds in activities that will directly benefit your bottom line.
If you’re considering whether you might benefit from an outsourced CFO when navigating the above or other scenarios, Thrive Financial can help. Building on years of financial expertise covering CFO, accounting, consultancy, and reporting efforts, Thrive Financial offers guidance according to your needs.
We’re here to help