Finance directors may be seen by some as glorified accountants – someone controlling the finances of a business. However, their role revolves much more around strategy and planning than ensuring that the cash is counted correctly, although this is clearly important as well!
A lack of appropriate management experience and know-how is a common problem for SMEs and entrepreneurial businesses. Most of these businesses are unlikely to be able to afford the step of employing an FD with the appropriate level of experience of the main strategic issues that they are experiencing at that time. These might include:
- dealing with banks on funding requirements;
- assessing high value capital project;
- expansion into new markets;
- mergers and acquisitions;
- stock market flotations;
- systems implementations; or
- a business exit.
Taking business exit as a specific example, when the time comes to prepare a business for sale it is unlikely that an SME will have the resources to hire a full time finance director with previous relevant experience. Therefore, it is perhaps not surprising that many entrepreneurial businesses are joining the increasing trend of hiring an FD on a part time basis (often abbreviated to “PTFD”). This route provides the business with access to a suitably qualified individual with appropriate experience on a part-time basis at a fraction of the cost of a full-time employee. This experience may have been gained in blue chip companies, or in SMEs, but all PTFDs will have been extensively vetted in order to ensure that they have the right attitude to work with SMEs.
In our business exit example an appropriate PTFD will be able to help ensure that the company has taken all of the necessary steps to ensure that the sale value is maximised. These were detailed in our blog which can be viewed here. They will also not only be able to help ensure that the business is properly managed, whilst the business owner focusses on the sale process, but will be able to help manage the information requirements of the sale process and manage advisors. In turn this allows the business owner more capacity to focus on the sale process, grow the business or achieve any number of other strategic objectives.
What it means for the business
Selling your business can be a difficult time. Having the appropriate finance director in place can help ensure that not only does a sale process happen more efficiently and the value of business maximised, but also that your business doesn’t suffer as a result.
Artemis Clarke helps business owners find finance directors that have the experience to support them. Not just to help them survive, but to help them thrive – whatever their business goals.
Speak to us about how the right financial help could make a difference to your business. Call 0117 244 1891 today.