What Does a Small Business Financial Manager Do?

A small business financial manager runs the day-to-day and long-term financial aspects of a small business. In some cases, a small business financial manager is also a partner or company founder, in others, the position may go to a professional financial manager. Though the tasks of a small business financial manager may change with each position, common responsibilities include creating or adjusting a business financial plan, performing cost-benefit analysis, maintaining financial records, and planning for the future of the business.

In a new company, one of the most important jobs a small business financial manager may have involves the creation of an initial financial plan. This plan will contain lists of the company assets, an analysis of start-up costs and operating expenses for the first year, a forecast for financial performance, and strategies for raising money to finance the business. In these early stages, the financial manager may also be in charge of meeting with potential lenders or investors, analyzing competitor data for financial indicators, and handling initial accounting for the start-up period. Start-ups that have some initial financing may be able to hire a professional financial manager to handle these tasks, while non-financed entrepreneurs may have to do this work to the best of their ability.

Once a company is operating, the job of a small business financial manager includes both daily and long-term tasks. He or she may be responsible for overseeing the correct management of financial records, so that pertinent tax, budget, or projection data is easy to access. In some companies, the manager or his department may be responsible for payroll duties, as well as calculating the correct salaries for different jobs within the company.

For any new project or planned expansion, the financial manager may be called upon to provide a cost-benefit analysis. This report can involve weeks or months of research, and is meant to give board members or partners an idea of whether a project is a worthy venture. Some of the tasks included in creating a cost-benefit analysis include researching the likely costs of labor, materials, packaging, and advertising, forecasting the likely revenue potential of the project, and determining what the impact of the project will be on the company as a whole. A small business financial manager may have the clearest idea of whether a project is likely to be profitable and attractive to investors.

The future of the business is an important concern of the small business financial manager. Using performance data, market forecasts, and careful research, he or she must be able to create plans and strategies for future expansion, new project development, and company evolution. In order to plan for a profitable future, the financial manager must have an excellent understanding of economic, market, and governmental trends that might affect the financial performance of his or her business.