The benefits of outsourcing financial management for SMEs

What are the advantages of partnering an external finance manager or director if you are a small business owner? After all, when cash is scarce, when banks are not playing ball, when customers are taking longer to settle their bills, when work is harder to find....... why should a small business even think about adding another overhead to the P&L?
The apparently most straightforward answer is that when the economy is on its uppers, then it's best to try to ride out the storm until it abates and signs of the new financial order can be seen on the horizon (however far off that might be). This strategy can undoubtedly work - if the business has sufficient cash reserves, bank support, suppliers with patience, customer loyalty, motivated employees and accurate management information to hand to be able to assess the current viability of the business at any particular point. But any business, during periods of crisis, also needs to predict its future viability to ensure that it is well positioned to be able to emerge on the other side of a recession with the capability of rapidly exploiting the commercial opportunities that will be presented when markets open up once more.
By outsourcing financial management, the business owner can benefit from having the budgeting and forecasting skills of an expert in financial planning allied to his or her own operational nous and understanding of the market. Having an experienced resource on-call to help in keeping even half an eye on predicting what might happen in the future, at a time when trading conditions are never-endingly tough and time-consuming, can give the forward-looking entrepreneur a significant competitive advantage when profitable opportunities appear once again. Furthermore, the financial and operational information and performance indicators that can be selectively extracted and evaluated by a commercially-focused accountant can be provided to the business owner when and how they are demanded. And of course, by being outsourced, the costs and associated issues of employing even a part-time finance professional are more easily managed.
At 8020 Financial Management, we have partnered many small businesses who have found they needed support to make sense of the numbers but who did not need or want a full-time accountant or FD on the books. As external and objective trusted advisors, we have helped businesses successfully improve their financial planning capabilities, thereby providing a better foundation for implementing their strategies profitably. Contact me for an introductory chat on rory@canmore.co or visit www.canmore.co to find out how a flexible approach to outsourcing control of your finance function can benefit your business - now and for the future.

What benefits would having a Financial Director bring to an SME?

When cash is tight, when the banks are being less than supportive, when customers are more difficult to attract and retain - why should a hard-pressed SME owner even think about hiring the services of a finance director? Surely the FD role is of benefit only to larger, more complex organisations. Maybe not. Let's look quickly at just 8 simple reasons why an SME might gain advantage by having direct access to expert advice and assistance for improving financial management:

1. An FD can be outsourced on a part-time basis to collate, interpret and report management information and liaise with stakeholders in ways that align effectively with the business's budget for improving financial management - i.e. expert advice can come at an affordable price
2. Business planning, essential when economic conditions continue to be turbulent, can finally be given the priority that experience has taught the SME owner is really required; a knowledgeable FD can listen to, evaluate and assess plans and ideas to ensure that the overall strategic vision can be carried through
3. Budgets can be set to help the owner monitor performance, identify progress towards goals and personal ambitions or, just as importantly, highlight when something is not going according to plan
4. An FD can suggest the key performance indicators that should be measured to identify quickly if the business is on target to achieve its financial, operational and reputational targets
5. Business reviews can be carried out not only by someone with an independent, objective focus, but also with an understanding of the importance of the contributions made by the other key functions in an enterprise
6. Forecasting becomes a core financial management tool for the business - having a reasoned idea of where you likely to be in the future is better than realising that opportunities have passed you by when it's too late
7. If refinancing is required to be able to keep a business going, an FD can help you gather the management information and prepare applications to existing and prospective funders and investors
8. Having a person accessible with financial management expertise gives the owner someone else to bounce ideas off, seek assurance about current performance or ask for critical appraisal whenever they feel it is required

If you want to discuss the possible benefits of having access to the expertise and experience of an outsourced finance director, please contact me for an informal, no obligations chat - we might uncover something that allows your business to take off!

e-mail  rory@canmore.co

www  www.canmore.co

SME Financial Information - answering the owner's questions

SME owners, for too long now, have accepted basic financial updates from their bookkeepers and accountants that provide only a fraction of the useful information about the performance of their business that is created daily. Usually such 'reports' are delivered well after the transactions that generated the numbers have occurred - so the owner has no chance of determining whether the figures are indicative of progress towards planned targets or symptomatic of operational problems just after the events - e.g. jobs completed, sales generated or materials purchased - have taken place. The omnipresent uncertainty about future trading conditions resulting from the credit-crunch, and now the double-dip recession, is demanding that forward-thinking SME owners have a good UP TO DATE understanding of how well the business is making progress towards its targets - be they growing profitability, income stability or just being able to 'ride out the storm' until market conditions take a turn for the better.
Providing accurate and reliable management information to small business owners - in a format that both answers the owner's questions about performance and makes it easy to pinpoint the key areas for action - is the prime focus of 8020 Financial Management. We know that generalised quarterly management accounts are no longer sufficient to help you monitor all the many activities that you have to control and improve to keep the enterprise moving forward. That's why we can offer an outsourced, part-time financial management service to SME owners that meets their need for information at a price which the business can budget for effectively.
To find out if we can help you to understand the dynamics of your business better - by having timely access to the management information that your actions are constantly generating - get in touch with 8020 Financial Management.  You'll find more about me and the ways I can work alongside you to help you (re-)engage with your business on a new level at www.canmore.co or e-mail me directly at rory@canmore.co The first discussion is free and without obligation, but we may find a way of making working for yourself fun again!