A fractional CFO, or Chief Financial Officer, is a finance professional who works on a contract, part-time, or retainer basis. They bring the expertise and experience of a high-level CFO to your business without the cost of hiring an in-house, full-time employee.
Fractional CFOs service several clients at once, typically on a contract, part-time, or retainer basis. They specialise in providing outsourced CFO services to small to medium businesses.
Because their financial management skills are so well-developed, it’s common to bring one on board to help navigate through financial challenges. Continue to learn more about what a fractional CFO does.
Navigating Challenges
Start-ups and small businesses usually have a streamlined staff, which helps keeps costs down and allows the business owner to focus on healthy growth.
However, sometimes, financial challenges can come up that are beyond the skill or experience levels of the team. This is where a fractional CFO can be of great benefit. Some of the issues they assist with include:
- High Expenses
- Cash flow problems
- Cost cutting analysis
- Low gross margins
- Getting through an audit
- Existing systems that are no longer working
Hopefully, these situations don’t arise often, but when they do, it’s beneficial to have an expert on your side to guide you through.
Achieving goals
All businesses generally start with a similar formula, invest your time and money, create a product or service that customers want, and earn money by providing that product or service. Perhaps you envision your business expanding somehow or scaling up. Maybe an exciting opportunity comes up, but you aren’t sure how to take advantage of it.
A fractional CFO can help you make your dreams a reality by deciphering the numbers. They will look at where you are now and help you plan where to go next. This includes:
- Ensuring the books are in order
- Performing financial forecasts
- Attending board meetings to get a sense of the company
- Helping with strategic relationships
- Overseeing due diligence
There are plenty of ways a fractional CFO can improve your operations. The specific skills and experience they provide will clarify your situation and help you achieve what you want.
Managing growth
Taking your business to the next level can seem daunting. You want your business to grow but don’t want to risk your success by taking on too much or making a damaging misstep.
Hiring a fractional CFO will help you navigate the steps ahead. If you’re already growing at a rate that is making you feel like you’re losing control, they will help you retake the reins.
A fractional CFO will help by:
- Making a plan to develop existing employees and their skills
- Breaking down large amounts of financial information into helpful data
- Implementing systems that will work going forward
- Identifying the need to hire new employees to manage growth
- Exploring causes of revenue loss and cost overruns and developing solutions to address them
Ultimately, a fractional CFO is helpful to guide you through the growth process so that you can feel confident and reassured as your business expands.
Final Thoughts
Many small and medium-sized businesses and start-ups could benefit from the services of a CFO, especially during a growth stage. By hiring a fractional CFO on an as-needed basis, you can enjoy the benefits of their expertise without breaking the bank.
If you have any questions, feel free to Join the conversation…