Small business owners often start out with limited resources and take on multiple roles and responsibilities themselves. As the business grows, it becomes increasingly difficult for them to continue to juggle their ever-increasing workload. Over time, those who fail to delegate responsibility and stretch themselves too thin risk damaging the health of their business.
Successful entrepreneurs know when it’s time to hire help to address the evolving needs of their business. When I’m asked what is the best time to hire a Chief Financial Officer (CFO), my advice is when you realize you can no longer manage your company’s finances on your own. That said, it may not be realistic or cost-effective to hire a full-time professional to take on this critical role.
Outsourcing is a logical next step for your small business when you need to fill knowledge gaps or to access specific skills that, as a business owner, you lack.
Benefits of Outsourcing CFO Skills
There are strategic advantages to tapping the skills of an independent contractor or virtual CFO to access the expertise you need. These include:
Experience
Outsourced CFOs have decades of experience. They know what they are doing and can deliver results quickly and accurately. They can provide well-researched and decisive goals to improve operations, and are less likely to have difficulty making tough cost-cutting decisions.
Objectivity
Working with an outsourced CFO is a great way to get an honest picture of your finances. A virtual CFO has no personal agenda and can offer unbiased opinions and advice. An in-house CFO may have personal attachments that limit their view.
Cost
Outsourcing CFO services allows you to access highly-qualified experts at a fraction of the cost of hiring a traditional CFO. Many small businesses find it a more affordable option and use the savings to continue to grow their business.
Making the decision to outsource will allow you to focus on your core strengths and increase your business’ bottom line by increasing efficiency and effectiveness as well as saving money.
Outsourcing a CFO May Not Be the Ideal Choice for Everyone
To determine whether hiring a virtual CFO is right for your business, do your research. Evaluate your specific challenges, financial goals, and your budget for CFO services. If you decide to test the waters, be prepared to interview multiple candidates before choosing the professional that best fits your needs. As with any new hire, you will need to be confident in their skills and abilities and trust them to handle one of the most sensitive aspects of your small business: your financials.
