There are many benefits to working with a CFO, such as having deep insight to your financial circumstances, which is essential at any stage of your professional development. Once your company starts to grow, you need to not only be in control of current finances but also have a clear idea of what the numbers will look like in the future.
This is where the CFO comes in. From doing what’s best for everyone from employees to stakeholders to prepare for the future, here are some of the top reasons that hiring a CFO can improve your finances.
1. A clear forecast
It may not always be clear skies ahead, but that’s no problem for an experienced chief financial officer. Trained to handle the ups and downs faced by every business, working with a CFO can help you make it through stormy weather.
While nobody can predict the future, having a CFO on your team can get you closer than most. Keeping a close watch on past trends in the market, a CFO decides where and when funds should be allocated based on previous market patterns.
2. Keeping the numbers in line
As a business expands they often chose this moment to hire a CFO, as they have a lot more to think about. Employees, stakeholders, investors and the list goes on, are all going to need to your financial reports. The more parties involved, the more complicated it is to keep track of this information and do so accurately. Tracking your expenses is essential for keeping on top of the basics, such as taxes, while also equally beneficial if you are planning on applying for funding.
3. Growth through diversity
If you are lucky enough to start growing a rapid rate, the way you run your business is about to change in a big way. CFOs are trained to handle the complex changes that come along with the company-wide expansion, finding efficient ways for your business model to capitalize on its strengths and improve its weak points.
Additionally, with growth comes room for diversity, and the subsequent rise of the freelance economy now provides plenty of reliable resources for locating and working with experienced CFOs from around the world. Investing in someone who has seen the ins and outs of operations at various stages will help you move forward and avoid mistakes as company beings to expand.
4. Better chances of acquiring funding
Depending at which stage your company is in, you might be ready to receive a little financial boost. A skilled chief financial officer can help you understand whether or not there are any gaps in your budget that would benefit from funding. Additionally, this knowledge comes in handy when it comes to crafting your pitch, as you now know exactly what to ask for. An experienced CFO knows what investors what to see, even if you don’t. Having this knowledge will greatly improve your chances of acquiring funding, as you will know when you are ready to apply, rather than just throwing caution to the wind.
5. Long Term relationships
Once you’ve made the decision to hire a CFO, you will have also just invested in your company’s future. While the primary job of a CFO is to help plan future expenses, CFOs today go beyond keeping the books nice and clean. As you grow and expand, your financial officer will be by your side to help you prepare for new stages of development in your company. Even if your business is highly successful with an international team, you’re always going to need someone who knows your numbers inside and out no matter how big you get.
For many businesses, the decision to hire a chief financial officer can be a tricky one. The position itself is vast, as the CFO is responsible for everything from controllership tasks to providing a detailed financial forecast to ensuring your business is on the right track.