Companies are always eager to cut costs and increase their profits. With the average salary of a CFO being around $100-$200k annually, it is easy to see why companies, particularly smaller companies, may choose to do without the services of a CFO rather than retain one at that cost. What those companies may be unaware of, however, is that there is a growing trend in the marketplace to retain Outsourced CFO Services, which are significantly less costly to your business than retaining someone full time.
Outsourced CFO services are of particular value when the economy is in a period of downturn or decline. Due to their expertise, they can help you regulate and increase your profitability even during periods of falling revenue. They do this by working with owners to streamline and change overall business practices, develop their accounting and finance departments and procedures, and also help connect them to financial data about their company that can help them make the correct strategic decisions.
Another bonus that outsourcing CFO services delivers is the ability to have an outsider take a look at your strategic planning. Many businesses which decided to reinvest their cash on hand or profits into promoting further growth during this period of economic decline have not seen good returns on their investment. With an outsourced CFO there handling your financing, they can help to rein you in when you or your company is going to make a bad decision that will negatively impact your bottom line.
Payment structure does vary between contractors, however, you will be able to find people that offer their services at flat, project-based rates, and some that will work with you on an ongoing basis for either hourly or monthly fees. Make sure you mitigate any risk regarding your privacy concerns by having prospective CFOs sign non-disclosure agreements. Also make sure you interview several candidates for the job, so you get a good idea of the overall quality of the candidates in your area, and can see a few different fee and rate packages before you commit to one. Then, you can begin reaping the benefits of an outsourced CFO, and take your company to new levels of profitability!