As you operate your dental practice, you may be wondering if hiring a CFO is the right move. Having a CFO within your business can bring great financial clarity, especially during complex decisions, but you may not need one quite yet if your practice is on the smaller side. This blog will discuss different things to consider when deciding whether a CFO would benefit your practice.
Signs You Don’t Need a CFO Quite Yet
A CFO can be a great asset to your practice, but giving them a full-time salary can drive profitability down if your business isn’t currently experiencing large growth or expansion. If you have a single office or just need help with simple bookkeeping, a full-time CFO might not be required yet.
Here are some good alternatives to consider:
- Dental CPA: Finding an outside CPA or dental accounting firm can help you with important tasks such as bookkeeping, tax compliance, and financial reporting. They can also give you some educational insight on the future of your finances without having to bring on another person.
- Part-Time CFO: If your practice brings in roughly 1M-2M in revenue a year, it could be smart to bring in a part-time CFO. This way, they can still help you with their financial expertise, but it won’t be a large strain on your profitability.
Signs It’s Time to Introduce a CFO
Do you think it’s time for more than discussed above? Consider if your business is experiencing any of the following:
- Much of Your Time is Spent on the Financial Side: Oftentimes, if a dentist isn’t working with a CPA, CFO, or financial professional, they are doing much of the brunt work. This can take you away from doing dental work and put financial pressure on you. If you are experiencing this, it may be time to hire a CFO to delegate those responsibilities.
- You Are Experiencing Rapid Growth: If you are bringing in more than 1.5M in revenue or are expanding to more than one location, a CFO can help bring financial clarity with all of the moving parts that come with growth.
- You Need Help Making Complex Decisions: If you are considering anything like partnering or merging with other people or places, a CFO can help with all the financial ins and outs. They can also help you see what each of these decisions can look like for the future of your business.
These factors can indicate that your dental practice could greatly benefit from hiring an in-house CFO.
Conclusion
Look into the operations of your dental practice to decide if a CFO would be a good fit and investment for you. Are you currently facing tremendous growth, complex decisions that require expert financial knowledge, or too much time working on finances? Or are you a smaller company that is just looking for some financial clarity? Through the considerations discussed above, you can know what’s best for your dental practice currently and for the future.