You’re a small business owner considering outsourcing CFO services. GREAT! That’s a good sign! It shows that your business is expanding!
You’re focused on the growth of your business, sales, your employees, and you’re way too busy to fool with numbers.
Just let the bookkeeper handle it.
However, what most entrepreneurs don’t realize is that the purpose of looking at your numbers is to lead you and guide you, and give you a clear picture of where your company is headed.
That’s something a bookkeeper was not made to do.
Maybe this will shock you, but CFO services have so much more mobility in their role, and much more insight into your business than your bookkeeper does.
CFO services can help you turn accounting from a checked box to a strategic tool that can help you make decisions for the future!
If your a small business on the brink of growth, this post is for you. This post is going to tell you why CFO services for small businesses are CRUCIAL for your business to flourish.
As your business grows, your needs grow, and they’re going to definitely outgrow the role of a bookkeeper.
Is Good for Data Entry
The core of bookkeeping is data entry and coding, making sure the accounting systems, spreadsheets and databases are populated with the correct data, and coded to the right accounts so that the bills can be paid and reports can be pulled. It involves tracking all income and expenses, paying bills, invoicing, tracking payroll, etc.
Bookkeeping is essentially a data-entry function.
Only Looks at the Past
According to Kern Accounting, some bookkeepers understand basic accounting, others do not. I’ve found that there are numerous bookkeepers out there who “know”QuickBooks, but they couldn’t interpret the numbers or understand the accounting effect of what they are entering.
They don’t question what the numbers mean.
They don’t interpret financial statements.
They do not do financial forecasting.
They simply present the numbers in a black and white way.
And when you’re trying to grow your business, what you really need is someone to be able to add some insight and color.
Well guess what? A fractional CFO can add some insight to your finances and ecompasses everything you need in a financial advisor!
The roles of a bookkeeper are very limited. They’re great at entering data, and keeping your records up to date.
But there are many more essential services that a fractional CFO can provide to rapidly growing businesses.
CFO Services for Small Business Brings Early Expertise
Most small businesses base the financial expertise they’re able to acquire on the progression of their budget.
They start with a bookkeeper simply because they believe that’s all they can afford.
They slowly move up until they can hire a full time CFO…
…but in most cases, that takes years! And that means the most critical expertise a startup needs is not accessible until very late in the growth cycle of a business! And that just won’t do.
A financial mistake for a small business is dire to its survival and sustainability! Truthfully, small businesses need the insight of a CFO more than an established company.
Small businesses need to be able to make quick decisions based on financial data—which is something a bookkeeper just cannot provide.
Most small businesses don’t know that fractional CFO services allow you to gain access to an experienced financial expert in the early stages of your business. Outsource a CFO which allows you to have as much or as little financial expertise as you need. Book your free Clarity Call to learn how we can provide leadership to your company!
CFO Services for Small Businesses Can Do Accounting and Budgeting
Of course when bringing on financial talent, you need someone to be able to take control of your financial records. Your righthand financial person also needs to oversee budgeting and have insight into the cashflow!
You need someone to be able to develop accurate and timely data, keep record of it, do monthly financial statements, tax reporting KPI’s, etc. You can trust CFO services to do that…
…but you can trust them with so much more!
Not only can outsourced CFO’s take ownership of your numbers, they also clear up the ambiguity that your financials can be. This helps you establish key metrics. For example, fractional CFO’s can assess which products gross the most amount of revenue, acquire more customers and increase your profit margins.
Isn’t that awesome? Most of the time when small business owners think of accounting, they think of filing taxes, bookkeeping, and keeping all things financial in compliance with IRS codes.
According to Forbes, many small businesses are just getting by with accounting softwares like QuickBooks, and missing out on the expertise they need.
But CFO services are able to take the data and use it to project helpful predictions for your business!
They look at your budget, your sales, your revenue, and thinking through every single month, they’re able to show you your strongest and most strategic opportunities for increasing profit.
CFO Services for Small Businesses Do Financial Forecasting
CFO services can help clarify the confusion that your financials can be, and use them as a guide to help your business with financial growth! They’re able to guide businesses as to what products are better to sell and forecast profit margins.
As your company grows, this is a crucial component! You’re already growing, but you need to know the most strategic way to keep growing. Bookkeepers are great for keeping track of data, but accurate data is only as valuable as your ability to interpret it.
A fractional CFO is able to take your data and use it to make predictions for your business. As they review your monthly budget, sales, and revenue, they’re able to see if there are any cliffs up ahead and make adjustments accordingly. They are able to zoom out, look at the bigger picture and tell you where your best chance for success is—what your strongest month is, what your strongest product is, thus helping you perpetuate tough financial calls. This frees up a ton of head space for you so you can focus on growth and forward moving activity.
A fractional CFO uses numbers and data to communicate the vision and performance, helping an entrepreneur and the employees sharply comprehend how your roles specifically contributes to success. This keeps employees aligned and working for a common purpose.
In addition, outsourced CFO’s can use facts to demonstrate goals and progress to investors and other audiences.
Ultimately, a fractional CFO drives growth and handles complex situations while controlling costs. Aside from reporting on financial performance, the fractional CFO can translate financial strategies into business strategies.
To sum it up, CFO services for small businesses zooms out and looks at the bigger picture. They make sure that the systems and people are in place to produce accurate financial information. This frees up the business owner to make better decisions about their staff members, their products, and everyday logistics. While a bookkeeper looks at the past, a CFO looks to the future to help reach the company's goals!
CFO Services For Small Businesses According to Clarity Consulting
At Clarity Consulting, we know when one person doesn’t have a handle on all the areas, things fall through the cracks. Part time CFO services and fractional CFO programs can open up a whole new world of operational efficiency. We’ve worked with dozens of business owners to create a deeper understanding of their financials. Instead of confusing and boring excel spreadsheets, we help create a clear picture of current financials and financial forecasts.
In addition, we also provide administrative support for HR, insurance and taxes.
Clarity Consulting is there to help with the new employee onboarding process. We make sure they have filled out all their documents and get direct deposit set up. If there is ever a change in contact information throughout employment, Clarity Consulting changes it, freeing up the business owner to focus on growth.
We help companies with their annual General Liability and Worker’s Comp audits by gathering all the certificates throughout the year and sending the payroll report to your auditor.
We communicate with your CPA and make sure your CPA strategy is being implemented throughout the entire year.
If you’re a small business that looking for a partner to bring more leadership, communication, and experience, set up a free Clarity Call with us!