The Many Skills Needed in a 6 or 7 Figure Business Finance Function
When you’re running a six or seven-figure business, you’ve moved on from just needing a cheap bookkeeper and/ or accountant, whom you speak to once a year to find out what you did last year.
You’ve got way more transactions and way more staff. We find that business owners at this level want to start looking at how much money they’re making, where they’re making it, and what their costs are, so they start asking the Bookkeeper and Accountant questions, only to be met with responses like “I’ll get back to you” (which they never do) or a blank stare.
Chances are you’re bigger than all of their other clients, or you’re just one of hundreds or thousands of other clients and they’re not really interested in getting to know your business as well as you do, so really aren’t providing you with any value.
They’re not an investment, they’re just a cost. A cost that has probably grown considerably over the years.
As a business grows, it requires a different set of skills.
In our experience working with multi-million-pound businesses every day, here are the elements that we’ve found are needed:
A great bookkeeper:
Many think this is a simple, low-value job that anyone can do, which is simply not true. If they don’t know what they’re doing, you can’t trust ANY of the information that goes into your accounts, and therefore you can’t use any of it to run the business.
Even other Accountants outsource this role to people who are inexperienced and perfectly capable of destroying your business (believe me, we’ve seen it happen!).
A great Accountant:
Although there is a lot of software out there that enables you to run a tax return and submit it relatively easily, it takes a great Accountant to save you money on tax, as they will know the loopholes and what you can do throughout the year to keep your bill down.
Someone who knows what they’re doing overseeing it all:
This bit is key when you start getting over the £1m turnover mark. It’s all very well having a great bookkeeper and a great Accountant, but more often than not neither of those two has the commercial background to manage the growth of your business, increase the profitability or simply make sure you don’t run out of money.
This person is horrendously hard to find in a Bookkeeper or an Accountant who has never worked in a corporate or commercial role. Generally, bookkeepers are interested in getting the data in and correct, but they don’t know what to look for when it comes to improving profitability and efficiency, and Accountants are only interested in doing tax and getting the information to Companies House and HMRC every year.
Finding a great Outsourced Finance Director is worth its weight in gold if you have big growth plans or need help with the general day-to-day running of your business.
