If you’re running yourself ragged to reach your business’ financial goals (and you feel like something is missing), you might need outsourced financial leadership.

Successful business teams have well-rounded skills and strengths. Their expertise encompasses finance, marketing, risk management, legal and regulatory knowledge, people management and technical know-how. If your business lacks expert skills in one of these areas, it’s not the end of the world. You can choose to outsource the leadership expertise that you require, relatively quickly and easily. 

In this article, we’ll look at warning signs that indicate gaps in financial leadership. If the following symptoms look all too familiar, it’s time to consider outsourced CFO services.

Warning sign 1: inaccurate financial data

Inaccuracies on company financial statements represent a serious threat to your business’s health and productivity. For example, errors in accounts payable reporting can wreak havoc on your cashflow.

Without a thorough picture of capital committed to existing projects, you may find yourself without the funds necessary to cover a production emergency or take advantage of an expansion opportunity.

Additionally, inaccuracies can trigger audits, both internally and externally, which leads to more lost time and productivity. If you often find yourself scrambling for data or seeking information before you can make a decision, you may need outsourced financial leadership.

Warning sign 2: poor cashflow

Poor cashflow can affect your business in so many ways. The non-financial costs of poor cashflow can have just as negative an impact on your business as the financial hits. Here are nine ways inconsistent cashflow hurts your company:

  • Increased interest and bank charges
  • Missed opportunities (when you don’t have enough capital to take advantage of expansion opportunities or to simply take advantage of supplier’s specials)
  • Poor relationships with suppliers because of late payments
  • Poor relationships with customers
  • Low employee morale when your staff worries about their long-term future
  • Stress
  • Solvency issues created by long-term poor cashflow
  • Restricted growth because you don’t have the resources to fulfil extra orders

If your business has experienced any of these issues, it’s time to bring in a virtual CFO to alleviate the stress and regulate cashflow problems. Once the operating cashflow levels out, you’ll have the capacity to pursue loftier business goals.

Warning sign 3: you’re underusing your software

It’s a common story: in a growing business, bookkeepers and accounting staff create their own manual processes to keep up with the numbers. They often don’t have the time or expertise to fully implement or utilise the software available to them.

While many smaller businesses get by on these ad hoc systems for some time, they are highly inefficient and can lead to reporting errors.

An outsourced CFO can ensure the software is used to its full potential, creating greater efficiency and processes within the department. And if you need better software or technology, a CFO can help identify, choose and implement appropriate software that will scale with your business.


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Warning sign 4: you’ve struggled with budgeting

A solid budget provides a road map for business owners as they navigate through each month, quarter and year. With goals in sight and trackable milestones along the way, it’s much easier to meet your objectives and stay on track.

When you work off of a budget, you can curb unbridled spending and instill a sense of accountability. A budget also provides motivation; it may motivate staff members to think outside the box for solutions to sales shortfalls or expense overages to help the business hit its targets. 

But with so much on your plate just to keep the business operable you may not have time to construct and follow through with budgeting. That’s where outsourced financial leadership can step in and provide assistance. 

Warning sign 5: you don’t know where you stand

Keeping up with industry trends and your competition is tough. Benchmarking involves a process of comparing your business’s performance to an appropriate comparison, which might come from a similar business or industry standards.

Is it helpful to see how you measure up? Absolutely. Banks will want to see your financial ratios when determining whether or not to extend a loan. You’ll be able to pinpoint weaknesses in your processes and procedures. Fixing these issues will make you more competitive and help you to adapt to ever-changing market conditions.

Warning sign 6: you’re unable to make decisions

With so many numbers, projections, graphs and opinions competing for attention, it’s often easy for business owners to fall into analysis paralysis. But if you feel like you’re spinning your wheels and unable to move in any direction with confidence, it could be a sign that you need an outsourced CFO to steer the ship.

In our experience, business owners most often seek the guidance of an external CFO for the simple fact that they’re unable to make decisions. An experienced and impartial perspective of your financial health could be just what the doctor ordered, allowing you to plot a confident course for growth.

Is it time for outsourced financial leadership?

A part-time, external CFO brings knowledge and expertise gained from other growing companies. And an outside perspective can do wonders for your leadership.

With accurate financials, healthy cashflow, up-to-date software, a working budget and industry benchmarking, you’ll strengthen your business from every possible angle. And these aren’t the only services our CFOs provide. 

Why learn from your own mistakes when you can learn from the actions of those who have come before you? Get in touch with us at Ulton to discuss your financial leadership needs. Whatever your concern, we’re here to help. 

Want to learn more about Ulton’s External CFO services and the benefits associated with these – check out our white paper ‘Empower your business with an external CFO’. 

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