Outsourced finance has emerged as a highly flexible solution for UK SMEs. Traditional accounting pressures like bookkeeping and general admin persist from day one of trading, but the longer a business operates, the more it needs focused guidance.
Late payment figures from the Small Business Commissioner illustrate this point well. They show an £11bn overall cost to the economy and over 14,000 doors shuttered each year as a result of delayed revenue. How SMEs manage their cash flow and choose their clients can have a significant impact on their chances of success, even more so today as running costs continue to rise. These high-level strategic decisions require an expert, hands-on approach, and this is where fractional CFO services thrive.
What should SMEs look for in an outsourced accounting provider?
To outline the best outsourced finance providers for SMEs, it’s first important to establish the criteria by which they are judged. Discounting ground-floor accounting duties like bookkeeping and basic tax compliance that can be handled in-house by a relatively small team, what services should a business expect from an outsourced finance provider?
These selections each display a depth of expertise in one or several fields, offer diverse operational support, and help businesses restructure their reporting to better serve their core objectives. Inherent in outsourced finance is the idea of scalability: an SME can opt into their services as and when they’re required, but the best firms lay the groundwork to help ensure great financial performance in the interim through streamlining accounting and reporting channels.
- Accounts and Legal
Accounts and Legal help SMEs manage everything from their daily compliance needs to long-term strategy. What sets them apart from the competition is their dual expertise in high-level accounting and legal support. They combine services like forecasting, scenario and tax planning, and cash flow optimisation to give owners a truly expansive view of how their company is performing, as well as legal advice that can help guide decisions on structure, contracts, and acquisitions.
These London accountants offer a comprehensive suite of solutions designed to help business leaders no matter where they are in their journey, whether that’s preparing for a round of hires, trying to navigate regulation, or lining the company up for a potential sale.
- Finerva
Specialising in hypergrowth start-ups with investor backing, Finerva deals with the lightning-quick industries of tech, life science, and e-commerce. For companies like this, financial reporting forms the basis of every move they make, as ensuring backers see a good return is a main priority. That’s what makes Finerva such a good contender; they cater to a specific market while shaping and refining their services to match client needs and expectations.
They cover both routine accounting duties, like bookkeeping and payroll, and also provide fractional CFO-level support on mergers, advanced tax structures, and sustainable scaling.
- The CFO Centre
The recent growth of the CFO Centre shows how in-demand outsourced financial services are amid a country-wide skilled recruitment drought. They’re a great general option, providing CFO-level guidance to SMEs, family-run businesses, and CEOs from across industries. They integrate firms from across the UK and the world to build a network of experts that can tackle any problem, from a cash-flow bleed to drafting an exit strategy.
Despite the size of the organisation, the CFO Centre’s local representatives put their clients first, building relationships and instilling discipline that lasts well beyond whatever contract they honour.
- Flinder
Flinder blur the line between a traditional outsourced finance team and a data analysis agency. Their modus operandi centres on smart financial function, taking a technology-first approach to strategy and planning, informed by strong CFO fundamentals. They can help SMEs in SaaS and e-commerce fields optimise their workflows and prepare for investment rounds.
If leaders find themselves struggling to decide whether to prioritise development projects or upgrade their real-time reporting analytics, Flinder can help shed some light on their options.
Finding the right provider
Exactly which outsourced accounting team would work best for your company will depend on where you are in your development, and where you want to go next. In the unstable earlier years, zeroing in on sound foundations like tax compliance and payroll can set you up for success. As you scale, you might find yourself considering different forms of financing, or needing dedicated guidance as your books grow too complex to keep track of.
What matters most is that you identify where your current financial function is lacking. You can then choose a provider that’s both equipped to tackle the problem and interested in building a long-lasting relationship with your SME.
