I see a lot of accounting firms advertising fractional CFO services.
I understand the appeal. Business owners want someone who can explain their numbers and help them make decisions. They want to know whether they can afford another employee, buy more inventory, or take on a loan.
But do you need a separate fractional CFO to answer those questions?
Depending on your business and what you need, you may already have that experience available through your accounting firm.
I Started a Business From Scratch, Too
I have spent 30 years working with business owners. I have also spent those years building my own business.
I have hired employees, set prices, purchased an office building, invested in technology, and made decisions about how much growth we could handle.
I am also the person responsible for the financial management of our firm. Whatever title you want to give that, the decisions still have to get made.
Can we afford the new hire? Will the investment pay for itself? Are we charging enough? How much cash do we need to keep available?
These are questions I deal with in my own business. When a client asks them, I understand why the answer matters. I have had to make those decisions with my own money.
The Books Have to Be Right First
Before we talk about next year, I want to understand this year.
If your inventory is wrong, your gross margin may be wrong. If your marketplace deposits are being recorded as sales, we may not have a useful picture of revenue or expenses.
Putting those numbers into a forecast does not fix them.
Our ecommerce team understands the reporting behind Shopify, Amazon, and the other selling platforms. They know how to use A2X and QuickBooks Online to bring that information together and check it.
Once the financial statements make sense, we can talk about what to do next.
Ecommerce Is Familiar Territory
I began working with my first ecommerce client in 1996. He sold antique toy trains and began selling on eBay in 1998.
We have come a long way from that setup. But owners still need answers to some familiar questions.
Am I making money on this product? Why is cash tight? How much can I afford to reorder? Are higher sales actually helping the business?
Our team understands the technology behind today’s ecommerce accounting. I bring the experience of working with businesses through different stages of growth—and doing it myself.
Both are useful.
Sometimes You Need a Conversation
Suppose you are thinking about hiring someone for $65,000 a year.
The salary is only part of the cost. There are payroll taxes, benefits, equipment, and the time it takes to train someone. Then we need to consider what that employee will allow you to do.
Will they help generate more sales? Take work off your plate? Replace an outside expense? How long can you carry the additional cost if growth takes longer than expected?
That is a useful conversation to have before making the offer.
The same is true of a large inventory order. Having enough money in the bank to pay the supplier does not necessarily mean you can afford the purchase. We also need to consider the other bills coming due and how long it may take to sell the products.
You should be able to bring those questions to your accountant.
Some Businesses Do Need a CFO
There are businesses that need someone maintaining detailed forecasts, working with lenders and investors, or participating regularly in management decisions. A qualified fractional CFO can be a good fit.
But be clear about what you are buying.
What work will they perform? What experience do they bring? Will they help make decisions, or send you another report to figure out?
Calling a service “fractional CFO” does not tell you much about the person doing the work.
Ask Us Before You Hire Someone Else
Our ecommerce clients have an accounting team that understands their platforms, experienced tax professionals, and access to someone who has spent 30 years building a business and advising other owners.
That may be enough for what you need.
If you want help planning for next year, understanding a financial problem, or evaluating a decision, ask us. We can talk about what is involved, whether it fits into the work we already do, and what additional help might cost.
You may need a fractional CFO. You may also find that the experience you were looking for is already here.