The top 10 benefits of outsourcing your financial management

Benefits of outsourcing your financial management

When you’re looking for a way to improve your SME’s financial management, you essentially have two options: employ someone in an internal role (full or part time), or outsource the task to an external specialist.

Generally speaking, the trigger for taking someone on in-house is linked to business growth. As demand for focus on financial management increases, internal resources start being stretched – putting more pressure on owners and managers where their time could be better invested elsewhere. The ‘tipping point’ is often when turnover has reached the £0.5m mark, but it may also come as a result of a strategic decision, in anticipation of sustained growth.

If the above doesn’t yet apply to your business, then there are plenty of benefits to be gained from outsourcing the role. Good quality financial support will add tangible value to your organisation, so whichever route you take, you must ensure that your chosen financial manager or director has plenty of experience and holds the relevant qualifications.

Ten reasons to use a freelance financial manager

Here’s a quick list of some of the key benefits of using an external financial management provider...

  1. Expertise – with so many other aspects of your business to manage, you need to identify the areas where you may have less experience and knowledge, so you can maximise your own performance and fill in any skills-gaps. While basic accounting may seem easy enough, a qualified financial manager will be able to bring plenty more to the table.
  2. Flexibility – like myself, most financial directors and managers will offer a variety of packages to ensure you get the right level of support, plus a range of additional resources for you to ‘top up’ your package as needed. This way, you’re only ever paying for what you need and use.
  3. An objective eye – sometimes you can be too close to a situation to really get a good view of the bigger picture. When you’re directly invested in your ‘baby’, you can’t always identify potential risks or bring yourself to make those difficult decisions. Having an independent but experienced professional to help is a great way of getting a clearer perspective.
  4. Breadth of knowledge – there’s a lot to be said for having experience across a range of industries. A financial manager who’s worked in various fields may be able to suggest strategies that you haven’t considered or wouldn’t think would apply to your business.
  5. Cost efficiencies – hiring an internal FM or FD comes at a cost, so the first thing to ask yourself is if you have enough work to keep them busy! Often, as a business is growing, support requirements will be fairly basic and won’t justify a full or even part time wage. Almost without exception an outsourced service will amount to less financial outlay than part-time, in-house personnel but with the added benefit of senior level skills and knowledge.
  6. System advice – as well as crunching the numbers and collating essential data and insights, you’ll also be provided with recommendations for other resources that will help you manage your accounting and business that you may not have encountered otherwise. This also comes with firsthand knowledge of the systems, and assistance in implementing them and maximising their value.
  7. Responsive service – if you need immediate support, you can engage with a freelance financial director much quicker than going through the recruitment process, which can take weeks, sometimes months, along with the added expense of HR and recruitment services.
  8. In-house training – it’s completely reasonable to expect your financial director to utilise their knowledge for upskilling members of your internal team. However, it’s no real substitute for targeted training, so I offer fully accredited courses to my clients, bringing staff up to speed with essential processes and allowing them to take a more active role in aspects of your financial management that may be better handled internally.
  9. Scalable – because of the flexible nature of outsourcing, you can scale the level of support you need as your business grows, while retaining the services of someone who already knows your business and financial objectives – and it will still be saving you money.
  10. Commitment – when you work with external suppliers, your satisfaction and the results they bring you is what they rely on to keep their own business growing and successful, so they’re heavily committed to delivering an exceptional service at all times.

As you can see, there are lots of benefits when it comes to bringing in a financial manager on an outsourced basis. The investment will almost certainly pay for itself, as they help you to manage your finances more effectively provide essential insights into where you can cut costs or increase profits.

If you’d like more information on how these services can help take your business to the next stage of success, please feel free to give me a call [L1] .

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