Spend Wisely – Go Part-Time

Do you have unlimited cash to spend? Of course not! Even Warren Buffett, Bill Gates, and Donald Trump have limited resources. Granted, they are not nearly as limited as the rest of us, but still they cannot endlessly spend indiscriminately.

Wasted Resources

After serving years as an employee in the CFO and Controller role, I suddenly realized something. Most of my time and effort was spent on tasks that had very little to do with being a CFO or Controller. That is not to say they were all useless endeavors, but much of what I did, while necessary, certainly did not require professional level skills. Those were tasks that would be better left to a less skilled person. I hesitate to use the term “less skilled” as doing so can sound arrogant and demeaning. But, it is not meant that way. Those duties requiring less skill still have to be performed. The question is, “Who should perform them and at what cost?”

The Problem Is

While those less skilled duties and roles must be performed, my observation was that too many companies (particularly small companies) were wasting resources when they used a higher level and higher paid person to perform them. It simply makes no sense to have a CFO or Controller working full-time and only spending a few hours each week on things that truly required higher level skills. And, it is not just the financial cost. For example, an employee who is not being engaged by sufficient challenges is more like to leave for another opportunity.

The Answer Is

A company would be better off hiring a CFO or Controller to work a few hours a week, every other week, or once a month and have a lower paid individual perform the day-to-day tasks that require less knowledge, skill, and training. Not only is this more cost effective, the people performing these roles (including the Part-time CFO or Controller and the lower level employee) are happier, more engaged in their tasks, and less likely to leave. The lower level person gets to have their abilities stretched and the higher level person does not get bored. Additionally, a Part-time professional level person will be exposed to other businesses that keep him or her growing and learning new things to help your company.

While you may pay a higher hourly rate for a Part-time CFO or Controller, you actually save money over the course of a year. Hear is a typical example:

Typical Company

Weekly

Hourly Rate

Hours

Cost

Full-time CFO or Controller

$       40.00

40

$  1,600.00

Full-time Clerical Person

$       10.00

40

$     400.00

Total Weekly Cost

$  2,000.00

Using a Part-time CFO or Controller

Weekly

Hourly Rate

Hours

Cost

Part-time CFO or Controller

$       75.00

10

$     750.00

Part-time Clerical Person

$       15.00

40

$     600.00

Total Weekly Cost

$  1,350.00

Weekly Savings

$     650.00

Annual Savings (50 weeks)

$ 32,500.00

Note that this does not include the impact of payroll taxes and other benefits such as health insurance, disability insurance, life insurance, and vacation pay. Since a Part-time CFO or Controller is typically an independent contractor, savings from these items alone can be an additional several thousand dollars a year.

What can you do with those savings? Invest in growing you business? Buy inventory? Pay off some debt? Hire another sales person? The possibilities are unlimited. So let me encourage you to spend wisely.

If you want to know more, contact AimCFO – Contact

As always, your comments are welcomed.

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