Pros and Cons of Outsourcing CFO Services

by margento | May 16, 2022

Every growing trade business needs the support of financial pros, and you’ve likely weighed the options of outsourcing CFO services or having a CFO in-house. 

Outsourcing can be a smart alternative to hiring in-house, especially for successful companies that are not of the size or complexity that requires a full-time CFO.

There are pros and cons to outsourcing CFO services that usually come down to properly fulfilling the business’ needs. We will cover both to help your trade business determine the option that works best for you.

Pros of Outsourcing CFO Services

Strategize Long-Term Goals and Why You Want to Achieve Them

While trade business owners, like yourself, are busy managing the day-to-day operations of their business, it can be easy for long-term planning to slip through the cracks. 

However, identifying your own personal, top priorities, allows you to then build a business that will help you reach your goals and serve as a representation of your core values. 

An outsourced CFO can help. They are planners that don’t just look at current financial statements but guide business owners to identify where they want their business to be in several years and then refine that vision. 

Once a complete picture exists, a CFO will use the numbers and help craft a vision of how to get there. 

The result is that you’ve then extended your financial, business, and personal goals; and as a result, can realign the present to get yourself to where you want to be.

Break Down Stretch Goals into Short-Term Action Plans

Breaking down your long-term goals into short-term action plans is essential for aligning the present and the future. You’ll start with your long-term or 10-year goal and work backward by crafting a 5-year, 3-year, 1-year, and finally 90-day goal. Because these 90-day goals are derived from your long-term goals, each time you accomplish a task, you’ll be one step closer to getting your business where you want it to be. 

As you can see, getting to this point requires a lot of planning and strategizing. This is where an outsourced CFO can really push you to reach your goals. They will collaborate with you to build 90-day goals, with your numbers in mind, that are relevant and achievable. Their financial expertise will elevate your business to the next level.

A Trusted Numbers-Savvy Advisor

In order to reach your short- and long-term goals, you need to have a strong understanding of your numbers. You’ll need to track the right metrics, run and derive essential information from your reports, and spend time making sure everything is accurate. This can take time, the time you need to actually run your trade business.  

This is where an outsourced CFO will be beneficial, they’re number pros who will get to know your financial condition, analyzes what the numbers say, and present the information to you so you can make the right decisions. 

You’ll be able to focus on your business and personal goals while they manage your finances.

Cons of Outsourcing CFO Services

Less Control

If you like to be hands-on in all aspects of your business, outsourcing CFO services might not be the best option for you. 

An outsourced CFO handles all of the finances so that business owners don’t have to. If your goal is to do more than check in to ensure you’re on track, an outsourced CFO is not for you.

You Could Find an Outsourced CFO that Lacks Experience in Your Industry

Trade businesses are unique. Cash flow demands look different, job costing is among one of the many essential and unique metrics to track, and compensating employees can be far more complicated – just to name a few financial tasks specific to the trade industry.

For these reasons, it’s essential you find an outsourced CFO that specializes in trades. They can set you up with the right tech stack, ensure you’re tracking the right metrics, and craft goals and strategies that are specific to your industry. 

If you don’t work with an industry-specific outsourced CFO, you won’t be leveraging your finances to their full potential. 

There Can Be a Disconnect

An outsourced CFO needs to understand you and your business. Communication is key, without it, your business could suffer. 

When you work with an outsourced CFO it’s a two-way street. Your decision-making has to be complementary to their high-level financial analysis, and vice versa. 

If communication isn’t where it needs to be, it can prevent your business from reaching its goals.

Outsourcing CFO Services is Easy with Argento CPA

An outsourced CFO can be the best thing that ever happens to your business or just another challenge to overcome. Argento CPA specializes in trade businesses, like electrical, plumbing, and HVAC, and understands the needs of its clients. 

We will work with you to avoid industry-specific issues and help you discover and set the right goals. 

We act as a partner to your business, ensuring your numbers are handled and you are confident in where your business stands financially. If you are interested in adding Argento CPA as a trusted member of your team, visit our website to learn more about our outsourced CFO services and business coaching!

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