By Rich Bond
When I tell you that as a business owner, you can make more money using the right financial information, do you see me as a conman, a huckster, or a snake oil salesman?
Recently, I had some conversations with business owners who told me that is exactly how they see me. They view modern financial management as “financial engineering.”
I was taken aback. Nothing could be farther from the truth.
In the last 30 years, finance has evolved, just as the world has. Business software has gotten better, cheaper, and available to companies of almost any size.
Yet, when I talk with most private company owners or managers, I hear that their financial practices are unchanged from the time they founded their companies.
“We’ve always done it this way. It works for us,” is a familiar refrain.
The message I want to convey is this:
If the products and services your company sells have evolved over time, shouldn’t your financial practices, too? If they haven’t, then they are probably hurting your business.
How is that? Modern finance people routinely close the books in 5 to 10 business days (or less), leaving the remainder of the month (12 to 17 days) for “value added” activities to help you run your business more profitably and efficiently including:
- Collecting your Receivables more quickly.
- Negotiating Better Bank terms.
- Improving inventory turnover, and the list goes on.
Yet, in many private companies all finance people do is close the books.
Modern finance professionals will provide strategic input on how to make your sales and operations more profitable. They can alert you to possible problems they foresee by developing and tracking certain key indicators.
As a recruiter, I am looking for business owners and managers who are willing to think about replacing their existing finance person or adding another person who will more than pay for him/herself.
In some cases, I will simply recommend coaching or other resources to remediate your finance function, if that’s all that’s needed.
Please think about what I’m saying in relationship to your business. Let me know if you think finance could be holding your company back. Then, we can see if we can form a mutually beneficial relationship.
To get an idea of what modern finance people have been able to do in companies like yours, download this white paper from the Resources section of this website: https://bondandcompany.com/resource/5-analytical-processes-that-will-make-your-business-thrive/
or email me at Richard.Bond@bondandcompany.com, and I will send you the PDF.
