To hire a CFO or not to hire?
It’s understandable if you’re undecided about hiring a chief financial officer for your small business. Like most small business owners, you probably think the position of a CFO is a reserve of high-value startups and large corporations. Plus, why make an executive hire in the finance department when you can bring in an accountant to do the same job?
Well, if that’s what you believe, you’re wrong. Any business that can afford to hire a CFO can hire one. But there are more important reasons to hire one than merely being able to afford one.
Continue reading to learn why you need a CFO.
Proper Financial Planning
In the United States, 82 percent of the businesses that fail will usually have run into some kind of financial challenge.
Money is the lifeblood of any business. Without it, your operations will grind to a halt. As such, it’s in the best interest of your business to put its finances in the hands of an experienced financial professional. A CFO is the professional you’re looking for.
But how does a CFO help ensure your business doesn’t become one of the many that fail due to financial challenges? They create proper financial plans for the business. If you didn’t know how your business’s finances will be looking like in five years, the CFO will produce forecasts.
With proper forecasting, you’ll be in a better position to make suitable operational changes.
If your dream is to grow your small business into a big company, you need an expansion strategy. It takes money to fund business expansions.
Where are you going to get this capital?
You’ve got a couple of options, including loans and equity capital. If you’re planning to raise capital from equity investors or venture capitalists, you’re going to need a CFO.
Investors need detailed financials of your company. They’ll ask technical questions that only a person who’s well-versed with equity investing can answer. With a CFO on your team, you’ll have a much easier time raising the capital you need.
Your small business faces a myriad of financial risks. The COVID-19 pandemic is a good example of an event that can pose dire financial consequences to any business.
How do you ensure your business doesn’t succumb to the financial risks it faces? There are several risk mitigation steps you can take, but the best move is to hire a chief financial officer.
CFOs are risk management experts. They’ll identify all the financial risks your business faces and implement the best risk mitigation strategies.
You Can Afford a CFO
Many small and medium-sized businesses don’t have CFOs because they can’t afford to make the hire. Sure, CFOs, don’t come cheap. They command a six-figure salary, but you don’t have to hire an in-house CFO.
There are companies that offer virtual CFO services. Your business will reap the same benefits as having an in-house CFO.
Your Business Needs a CFO
You might think that hiring a CFO for your small business is a luxury, but it’s not. A CFO, besides ensuring your business doesn’t run into financial challenges, will help take the company to the next level. It’s time to make the hire!
Explore our blog for more small business advice.