As a small business owner, you often feel like a one-man band. You’re beating the drums one minute, strumming the guitar the next, and taking a moment to tune the bass while simultaneously blowing the harmonica. There are twenty places to be, phone calls to make, emails to return, meetings to hold and spreadsheets to look at, at any given time.
It goes without saying that with so many things to do, certain things will be a little neglected, and others will get overlooked entirely. Sometimes we prioritise the most urgent things first, or those that will have the biggest impact on the bottom line. Often it’s the things like planning that get neglected – things that, in the short term, have little impact on the profitability of the business, but in the long term have everything to do with its success. Chief among them is the financial planning and management of the company.
It’s easy to hire a bookkeeper or accountant to make sure that the operational financial requirements of the business are taken care of. But what about when you’re plotting the future course of your company? When you’re deciding how to price a new service, or how aggressively to roll out a product in a new market? How do you tackle complicated tax reporting requirements? These are just a few scenarios in which you need the input of a finance executive. It’s input which, unless you are a qualified financial professional, you won’t be able to provide yourself.
Many small and medium enterprises try to circumvent hiring a finance executive. The biggest reason is the cost factor: many feel that having such a senior employee is prohibitively expensive for a small business. Another reason is that they feel the resource will be under-utilised. Yes, the business needs high level strategic insight that only a finance executive can provide – but not every working day. Or at tax season, they need the input of a finance executive, but for the rest of the year, a bookkeeper can adequately cover the company’s reports to the South African Revenue Service. So, they rationalize: rather go without the input of a finance executive for the time that it’s needed, than foot the full time bill of a finance executive for input that is only needed part-time.
The part-time finance executive: a win-win solution
What many SMME owners and management don’t yet realise is that there is another scenario which strikes a balance between the two extremes. The part-time finance executive responds to the reality that small businesses need high-level financial input only some of the time. Part time finance executives are brought into the business on an ad hoc basis.
- They provide strategic perspective when it comes to planning for the long term.
- Their experience helps them identify future pitfalls and opportunities for the company, and they are able to help business owners pinpoint the right time to take advantage of the latter.
- They can come in during tax season, to ensure that all requirements are met and that the company is up to date with the latest iterations of tax law.
- They can help prepare for the external audit process.
- SMME owners also find that finance executives can provide arms-length input into planning sessions. They have sufficient distance from the business to help scrutinize ideas and plans for the business, and to determine whether they are feasible or a mere shot in the dark.
The beauty about the part-time executive is that the company only pays for the necessary time from the professional, and no more. While there is of course still a cost involved, the long term benefit derived from their input far outweighs this. Many SMME owners that are making use of such a professional attest to this.
If your company could use some of the benefit of a part time finance director, The Finance Team can assist. We draw from a network of qualified associates who are highly experienced, and are available for the time you need them, however short or long that may be.
Image credit: www.gaapsearch.com