Is your business big enough to require the a CFO? As businesses grow, they transition through a period where they need the CFO function performed, but there is not enough work to justify a full-time CFO.
Many businesses try to make the leap all at once, going from no CFO to a full-time CFO. This is bad strategy, and for many reasons: The owner/CEO inefficiently wastes time doing things they are not good at, diverting their time from the things they should be doing. Or worse, important CFO functions do not get performed, often costing the business thousands of dollars in false moves, wasted expenditures, and employee fraud.
On the other hand, employing a full-time CFO too early creates a substantial fixed cost, and without immediate return on investment. By the time benefits are added to a CFO annual salary of $150,000, the annual cost can go up to as much as $175,000.
The answer is to use the services of a qualified part-time CFO. Ideally this person would spend 2-3 full-time days per month on site, would always be available by phone or Internet, and charge between $3,500 and $4,000 per month. I’ve seen companies with annual sales of $20M or more easily and efficiently get by with the services of a part-time CFO.
What is the size of your company? If you don’t have a CFO, how is this function getting performed? Are you relying on under-qualified personnel or diverting valuable CEO time? Or are you paying a full-time salary to a CFO who spends half his day twiddling his thumbs? If you haven’t considered utilizing a part-time CFO, this may be the time to do so.