Don't Wait! Here's 7 Reasons You Need a Fractional CFO.
The famous marketer David Ogilvy promised his team, “If each of us hires people who are bigger than we are, we shall become a company of giants.” That’s good advice -- when you can afford it -- but how can you add top talent to your team while you are fighting to stay lean?
When it comes to accessing C-suite financial skills, you have the option of working with an outsourced or fractional CFO, adding high-level capability without the risk and commitment of hiring a full-time CFO. Even if your business is just getting started, here are seven reasons why you need a fractional CFO now:
#1. You Need a Winning Strategy
Tampa added Tom Brady and won the Super Bowl. Right? Wrong. Mr. Brady executed brilliantly as always, but Tampa won because the offensive strategy of Byron Leftwich was effective in scoring, while the defensive strategy of Todd Bowles kept Kansas City from scoring even one touchdown.
Your company’s quarterback is you. No one is better qualified to face the problems, pitch the products and lead the team. But to combine your skillful play with a winning game plan, you need a CFO’s ability to strategize based on long experience with many different types of financial problems and solutions.
#2. You Need Backup for Major Opportunities
A growing company regularly faces moments of great opportunity for the first time. A fractional CFO can help you choose the most secure and effective path when taking on the industry leader, revamping your pricing, building a new headquarters, switching banks, merging with a competitor, bringing in capital partners, hiring top management and much more.
#3. You Need Backup in an Unforeseen Crisis
Henry Kissinger famously said, “There cannot be a crisis next week. My schedule is already full.” Every company will face moments of crisis, and an experienced CFO will help you find a path through the storm. A CFO knows how to help your company weather a cash crunch, tax audit or product recall, allowing the CEO and operational team to keep the company moving forward.
#4. You Need Data-Driven Decisions
A fractional CFO will work with your controller to design a reporting system that will provide the leadership team with a dashboard of the company’s vital signs. The bottom line is important, but there are many valuable signals on the way to compiling your monthly income and expense numbers. Which of your products are selling? Which of your expenses are running high? How fast is your inventory turning? A well-designed dashboard will highlight key performance metrics for decision support.
#5. You Need Fraud Prevention
As your company grows, more openings are created for the unfortunate occurrence of fraud and theft. Companies large and small are shocked to discover stolen intellectual property, collusion with vendors or outright theft from cash accounts. A fractional CFO can help you establish more detailed oversight, supporting your in-house staff with best practices for prevention.
#6. You Need Cash Management
Cash is the oxygen of business growth, and an experienced CFO can deploy a wide range of tactics for keeping your cash turning. A CFO can help you monitor cash on your dashboard, cut costs everywhere, send quick and accurate invoices, speed up collections, keep inventory moving, slow down payments, establish flexible credit and manage your bank relationship – all in the name of better cash flow.
#7. You Need Effective Annual Budgeting
The annual budget is the most important tactical element of a strategic business plan. The budget is the first indicator of whether or not sales are on track and whether spending is under control. The budget provides the metrics for versus actual analysis on both sides of the ledger, highlighting the availability of cash flows needed to manage debts and invest in growing the business. An experienced CFO can help your entire enterprise take more responsibility for their roles in generating the income and managing the expenses which will determine your success or failure to perform to the budget.
To discover more of the advantages a fractional CFO can bring to your Greater Chicago area business, visit Coveted Financial Services at www.covfinancial.com, or call (331) 442-4472.