Working with a virtual CFO versus doing it yourself

When should you work with a virtual CFO, rather than doing everything yourself?

If you are an ambitious business owner who wants to truly grow your business in the most efficient way possible, then the simple answer is always.

However, the commercially realistic answer is that it’s time to engage a virtual CFO when you are spending so much time on the financial management of your business that it is taking you away from profit-generating activities, or the sales and operations of your business.

In the early stages of your business, you will have the time to manage the basic financial aspects because you may not be fully occupied every day with actually performing jobs. As your business grows, it might become difficult for you to continue to handle the financial management as you look to grow your business to the next phase.

One of the first signs that it is time to consider a virtual CFO is when your attention moves away from financial management.

If you have taken on all the bookkeeping for your business, paying employees, contractors and suppliers, receipting payments and managing your cash flow, those responsibilities can fall to the wayside when you get a project or job that seems more important and requires your full attention.

At this point, you know that your business needs to take the next step towards growth, and a virtual CFO is required to help you plan for this growth.

You will also need your virtual CFO for your financing requirements, particularly as your business grows. They will help decide if financing is appropriate and, if so, what type of finance will best suit your business and then prepare you sufficiently for the finance application process to provide the best possible chance for approval.

Even if you have systems in place for your financial accounts, your virtual CFO is able to work with your bookkeeper and finance officer to identify and measure exactly what is driving your business performance and where you should be focusing. Conversely, they will identify what it is that could be causing you problems.

If you have issues with your cash flow, you will generally know that, however, you may not know exactly why or how to resolve those issues. There are many reasons for cash flow problems and some of those you may not even be considering, such as sudden growth or winning a large new client or contract. These things are great, but only if they are managed well financially because they could turn very bad, very quickly. Worse case, you could lose that new client or contract because you cannot manage it well and provide the level of service required.

If your financial reports are not making sense or you do not believe they are correct, you may need some help from an experienced financial adviser. Your virtual CFO will make sure the financial reports are accurate and they will then make sure you understand them and what they mean to your business. Together you will work through them to monitor your business performance and put in place the measures to improve those areas that need attention.

You will know when you are not managing the financial part of your business efficiently enough to help you with your business. All you need to do is be honest with yourself and make the decision to look for that support.

To discuss how a virtual CFO can benefit you and your business, please get in touch and we will guide you through the process.

Are you in need of finance or funding to help grow your business? Do you clearly understand the cost of money? Contact us for a free 30 min strategy consultation. Click here to get started

Let us review your business and funding requirements to help you grow your business and achieve your business goals – big and small.

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Tony Dimitriadis
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