5 ways a freelance finance director can add value to your SME

You may not have considered hiring a financial director, or perhaps you have, but decided that you can’t justify the additional outlay until your business reaches a certain size. However, as with any business decision it’s a question of balance, and when you weigh up the cost of a financial director versus the tangible benefits they can bring your SME, it might make you reconsider your position. 

A financial director can really help to accelerate your growth, so is holding off from employing one the right business choice, or do you need their support to keep you moving in the right direction... or even identify what the right direction is?

Employing a financial director on a freelance or outsourced basis can be a good way to access help without the overhead of an annual salary. If you’re not sure which way to cast your dice, here’s some advice…


How can a financial director boost your bottom line?

There are lots of ways a financial director can add value to your business – here are 5 of them:

  1. Capital and cash – one of the primary reasons that businesses come ‘unstuck’ financially is through poor management of cash flow and capital. You can’t be a specialist in everything, so your business model will primarily be built around your specific knowledge and skills, and that’s unlikely to include in-depth money management. A financial director will design a cash management system that’s built around your individual needs, helping to keep your finances in check and your cash flow effective – this, when done well,  can also create the headroom to fund the role of FD in the first place.
  2. Reduce costs – businesses can ‘leak’ money in a variety of ways, and when you’re focusing on servicing your own clients or customers, it can be hard to keep track of all your overheads – whether they’re static or fluctuating costs. Part of a financial director’s role is to monitor and review your expenditure, and identify areas where you can minimise expenses. For SMEs, there are often lots of opportunities to do this – as long as you know what you’re looking for!
  3. Funding and investment – in order to grow, many businesses need to secure additional funds, but it’s not as easy as just approaching a bank or an investor and asking for a cash injection. You’ll need to provide cash flow analysis, costings and evidence to demonstrate where and how the money will be used, the benefits of a boost in your bank balance and the potential returns that will be realised.
  4. Compliance – when it comes to finance, there are lots of compliance issues and regulations that you need to adhere to, such as your various taxes, contributions and reporting responsibilities. Miss a deadline with HMRC and you’ll end up paying for it – so it makes sense to have someone to keep an eye on your compliance calendar and ensure you’re meeting all the necessary requirements.
  5. Expansion and opportunities – another way a financial director can add strength to your business is by analysing and monitoring your money, the market and emerging trends – and then creating a growth strategy that seizes any opportunities to help you build your business in a measured and structured way.

 Outsourcing these responsibilities isn’t for everyone, but it is a great way to transition from operating without support to being big enough to need that support full time. So if you would like to grow your business or if you’re at a stage where your business growth has slowed, or you don’t have anyone internally to keep an eye on the more strategic side of your finances, then you’ll almost certainly benefit from some specialist support.

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