I am often asked this question by business owners what is the right time to hire a CFO? Many of these businesses have been working closely with their external accountant and have simply grown to a stage where they need more support and their external accountant has reached the limits of their service offering. This doesn’t mean there is anything wrong with their external accountant, it’s just that the business has reached a point in its growth cycle where it needs an in-house resource to provide a greater level of direction. Is this the right time to hire a CFO, has the business left it too long or should they hold off for even longer?
There are now many SaaS (Software as a Service) products out there that on face value seem really cost effective, but are they? What might start at a seemingly affordable $49 per month can grow to a much higher amount. How would you compare this monthly cost to a one-off, up-front cost of $20,000? Many businesses are taking the $49 per month option because it sounds affordable, but is this the best business decision and how would you compare the two options?
Here are some things you may consider when comparing the true cost of a SaaS system to other options:
A business is a lot like a leaking bucket, you fill it up with profits but as holes develop the profit can leak out. Retaining your profits for all your hard earned effort is about trying to predict how those holes could appear and then planning to avoid or minimise those situations. There will always be some risk involved, but this should be calculated and at a level which is acceptable. If you don’t take any risks, then you are much less likely to get anywhere.
When you have consistent revenue growth you have built a strong business, but revenue is only worthwhile if it is delivering profits. After all, that’s why you are doing it. So when you’ve reached that stage of your business lifecycle and have become accustomed to driving marketing and sales, how do you improve profit?
A vast range of skills are required to successfully grow a small-medium sized enterprise (SME). These include Sales, Marketing, Product Development, Operations, IT, HR and Finance. Employing full time staff in these roles could cost more than $1 million per annum – simply unaffordable for most SMEs – so how do you bring in those skills? Read more
A good business model is the foundation on which a business succeeds yet many business owners begin their venture without a well thought through model that will provide them the best chance of success.
Karan Girotra and Serguei Netessine wrote in Harvard Business Review (1) that a business model was essentially “a set of key decisions that collectively determine how a business earns its revenue, incurs its costs and manages its risks”. Whilst this sounds simple, it can be daunting to come up with a model that is succinct and easy to communicate to potential interested parties, most commonly investors.
A budget is a key tool to assist in keeping a business on track with its goals, but often the budget can become meaningless when underlying assumptions are not met. For example, a movement in the foreign exchange rate could mean your budget is out of date before you get started. So how do you pull together a budget that is achievable ? Here are some key steps to follow: Read more
The Christmas and New Year break is a time when we get together with our families and realise what’s important in life. We have opportunities for clear thinking and discussing life plans with people who are closest to us. Many of us will have a new outlook coming into the new year, feeling energised and will re-evaluate priorities both personal and business. You reach this point because you have people around you who you know and trust the most – your family and close friends. They are able to guide you towards the things that are most important to you and the things you enjoy.
Successful business people will commonly say that the key to their success is to surround themselves with good people. Read more
Do you find that when you try to step away from your business and rely on your staff that they don’t seem to have the same level of commitment that you expect of yourself. That sales order that you would have made sure went out today goes out tomorrow because the staff member had to go home ? When you employ staff to perform tasks that you used to perform yourself as a business owner, your business has reach a new level, and your skill set needs to move from supervising tasks to setting the scene and establishing goals.
Communication and alignment are key elements which contribute to the success of small business or the lack of it can lead to failure. I always remember the activity you do in primary school where you have 5 people in a line, the first has a message and by the time the message is passed through each person in the line to the last member, the message the last member gets is total different to the original message.