Search First CXO

Supply chains have always faced pressure—but today’s global landscape adds a whole new layer of complexity. From unexpected tariffs to shipping delays and geopolitical instability, companies are constantly being challenged to adapt. At the heart of that adaptation? The CFO . In 2025, CFOs aren’t just handling budgets—they’re building resilience. Here’s how financial leaders are helping businesses stay ahead of global disruptions. What Are Tariffs and Why Do They Matter? Tariffs are government-imposed taxes on imported goods. While designed to protect domestic industries, they can dramatically impact costs, profit margins, and sourcing strategies. Recent policy shifts—especially between major economies like the U.S. and China—have created uncertainty, forcing businesses to rethink their supply chain strategies. The CFO’s Expanding Role in Supply Chain Strategy CFOs are no longer just behind-the-scenes number crunchers. Today, they: Collaborate with procurement and operations Assess the financial impact of tariffs and supplier delays Develop models for supplier diversification and cost analysis Let’s break down how CFOs are stepping up in response to tariffs and disruptions. How CFOs Help Navigate Tariffs and Supply Chain Risk 1. Financial Scenario Planning CFOs use forecasting tools to model how tariffs could impact: Cost of goods sold (COGS) Product pricing Gross margins They also run worst-case and best-case scenarios so leadership can make fast, informed decisions. 2. Supplier and Sourcing Diversification CFOs partner with ops leaders to: Explore alternative suppliers in different countries Balance cost, risk , and availability Evaluate nearshoring or reshoring options to reduce dependency on high-risk regions 3. Cash Flow and Inventory Strategy Tariffs and delays can tie up cash in inventory or impact working capital. CFOs help optimize inventory levels to balance cost vs. risk They build cash buffers and adjust payment terms to improve flexibility When Should CFOs Step In? Ideally, before a crisis. CFOs should be involved in: Strategic sourcing decisions Long-term vendor contracts Business continuity planning Their involvement helps align financial and operational goals so businesses don’t just react—they prepare. Fractional CFOs: A Smart Move for Scaling Companies Not every company needs a full-time CFO to navigate complexity. Fractional CFOs  offer: Broad experience Strategic insights Scenario modeling Tech implementation All without the overhead of a full-time exec. FAQs How do tariffs directly impact profitability? Tariffs increase the cost of goods, which can shrink margins unless prices are raised or cost structures adjusted. What’s the biggest risk in a disrupted supply chain? Running out of inventory, delayed deliveries, lost revenue—and not having a financial cushion to absorb the impact. Can a CFO really help with operations? Yes. Today’s CFOs bridge finance and ops—helping build models, plan inventory strategies, and assess vendor risk. What tools should CFOs use to track global risks? Dashboards, ERP systems, and supply chain visibility platforms.  For example, NetSuite is a popular choice. References Harvard Business Review: Resilient Supply Chains Investopedia: How Tariffs Affect Businesses McKinsey & Company: Supply Chain Resilience

The role of the CFO is evolving—and fast. In 2025, CFOs aren’t just number crunchers. They’re strategic leaders, tech adopters, and drivers of innovation. One of the biggest forces behind this shift? Artificial Intelligence (AI). Let’s explore how AI is changing the game for finance leaders—and what it means for the future of the CFO role. What Does AI in Finance Actually Mean? AI in finance refers to the use of machine learning, automation, and predictive analytics to improve financial decision-making, reporting, and forecasting. It’s not about replacing humans—it’s about helping CFOs work smarter. Think of AI as your behind-the-scenes co-pilot. It’s analyzing patterns, flagging risks, and giving you insights faster than any spreadsheet ever could. How AI Is Transforming the CFO Role 1. From Reactive to Predictive Traditional finance looked backward. AI helps CFOs look forward. AI models use historical data to predict cash flow , revenue, and expenses. CFOs can spot risks before they hit and opportunities before competitors. 2. Automating the Routine Tasks like reconciliations, expense approvals, and report generation? Automated. AI tools free up CFOs from manual processes. This means more time spent on strategic decision-making, not spreadsheets. 3. Real-Time Forecasting Instead of waiting for month-end, AI tools deliver real-time insights. Dashboards powered by AI update automatically. CFOs can make faster, better-informed decisions. 4. Smarter Budgeting AI doesn’t just follow last year’s numbers. It analyzes: Market trends Consumer behavior Business seasonality This means budgets are more flexible, accurate, and aligned with business goals. 5. Enhanced Risk Management AI scans for anomalies and red flags instantly. CFOs can proactively manage fraud, compliance issues, and financial vulnerabilities. The Evolving Skills of the CFO in 2025 Today’s CFO needs more than financial expertise. They need to: Understand data science and analytics Collaborate with IT and product teams Lead digital transformation Communicate insights clearly to stakeholders In short, the modern CFO is part strategist, part technologist, and all leader. Where Fractional CFOs Fit In Not every business can afford a full-time, tech-savvy CFO. That’s where fractional CFOs  come in. They bring cutting-edge financial strategy and AI literacy at a flexible cost. Perfect for scaling businesses that need high-level finance expertise without the full-time salary. What AI Won’t Replace Even the smartest AI can’t replace human judgment, creativity, and leadership. AI helps CFOs make better decisions—but the CFO still makes the call. FAQ (Frequently Asked Questions) Will AI replace CFOs?   No. AI enhances the CFO’s role by automating tasks and surfacing insights. Strategic leadership still requires human experience and judgment. How can a CFO start using AI?   Start small—with AI-powered forecasting, reporting, or budgeting tools. Partner with a fractional CFO or tech consultant to explore the options. Is AI only for large enterprises? Not anymore. Many affordable AI tools are available for startups and mid-sized businesses. Bob Fiorella   CEO and Founder of First CxO.  Bob Fiorella is a strategic problem solver, M&A advisor, and right-hand man to CEOs and business owners contemplating or dealing with a major change; whether it's restructuring a company, building a finance team, getting a loan, setting the company up for growth, successfully selling the company, etc.  He began his career as an investment banker and worked on several deals including the multibillion-dollar merger of Avery and Dennison.  Over the subsequent two decades, Bob’s career centered around the media, entertainment, packaged goods, wholesale distribution, specialty retail, technology, and software development industries where he took on roles such as SVP Finance, Chief Financial Officer, Chief Operating Officer, Chief Strategy Officer, and independent board member. Bob is the Founder and President of First CxO.  Some of his assignments include being a fractional CFO for a $30mm packaging technology company, a $5mm software development company, and a $25mm e-commerce company.  He is also an advisor to a $500mm franchising company.  Bob holds a BS in Economics from Cornell University and an MBA from UCLA’s Anderson School of Management.  Bob can be reached at 310-422-6858, bob@firstcxo.com . Bob’s “claim to fame” is appearing on Season 13 of America’s Got Talent as part of the Angel City Chorale. They made it to the Semi-Finals.  References Harvard Business Review: How AI Is Changing the Role of the CFO Deloitte: The Augmented CFO Investopedia: AI in Financial Management

Having spent the last 30 years as an investment banker, M&A advisor , board member, and CFO working with all sizes and types of companies and transactions, I frequently get asked by private company owners, “How much is my company worth?”  Below I will outline the valuation process with the hope of helping you better understand that complex question. In general, there are three main techniques used by thousands of valuation firms, investment bankers, Wall Street researchers, and business school finance professors to value a business.  They are called different things by different people, so I will use the terminology I learned when I first started doing valuations.   For simplicity, let’s call that the company that is the subject of the valuation the “Target” and the party doing the valuation the “analyst” or “valuation firm.”   Comparable Companies   In the “Comparable Companies” methodology, the analyst’s goal is to find publicly traded companies that have similar characteristics as the Target.  Characteristics could include industry, revenue, geography, customers, markets, etc.  The analyst then compares the overall stock market value + debt (the “enterprise value”) of the comparable company to that company’s relevant financial metric (e.g., revenue, EBITDA , net income), resulting in a multiple of the financial metric (most commonly EBITDA) to the enterprise value of the comparable company.     Example: if a comparable company has a stock market value of $80mm and $20mm in debt then the enterprise value of a company is $100mm.  If a recent 12-month EBITDA of the company is $10mm, then the EBITDA multiple for the company is 10x ($100/$10 = 10). In the Comparable Companies method, like the Comparable Transactions method below, the analyst’s goal is to find as many comparable companies to the Target as possible - the larger the dataset, the better - without compromising the relevance and quality of the comparable companies. There is no hard and fast rule on what makes a company “comparable.” Nor is there a rule on the total number of comparables needed, but let’s assume 5-10 companies for now.     Once the analyst has a list of comparable companies, the next step is to collect the relevant financial information from those companies and create a set of valuation multiples.  From that dataset, the analysts will eliminate the outliers and then look at the low to high range, average, and median multiples.  Lastly, the analyst will apply the results of their analysis to the Target.     Example: Assuming the median EBITDA multiple for a set of seven comparable companies is 10x, the average is 9x and the range is between 7x and 13x.  Assume also that the Target’s latest EBITDA is $5mm, then the potential values for Target are: Median $50mm (10x$5mm) Average $45mm (9x$5mm) Range $35-$65mm(7x$5mm & 13x$5mm) Comparable Transactions:     Similar to the Comparable Companies method above, in the Comparable Transactions method the analyst looks for data from publicly available data for recent sales or acquisitions of companies similar to the Target.  This Mergers and Acquisitions ( M&A ) transactional information is available through public documents filed through the SEC (e.g., 8K’s 10k’s, etc.) and/or is gathered through other means (e.g., investor calls, new articles, etc.) Then, similar to the Comparable Companies method above, the analyst creates multiples of enterprise value from those transactions and applies those transaction multiples to the Target.   Example:  Again, assume the Target has EBITDA of $5mm.  Let’s assume the comparable transaction analysis comes up with ten recent comparable transactions with a median EBITDA multiple of 11x, and average of 12x, and a low to high range of 6-15x.  The range of values for the Target using the Comparable Transactions method would be: Median $55mm (11x$5mm) Average $60mm (12x$5mm) Range $30-$75mm (6x$5mm & 15x$5mm)   Discounted Cash Flow Method:     The next valuation method comes in various forms and can be called different things.  I am lumping all of them under the generic term of “discounted cash flow” (aka DCF).  In a DCF, the objective is to forecast the profitability / cash flow of the Target in the future (typically 3-5 years), assume a value of the Target at the end of that term (a “terminal value”), and discount all of the above back to today’s dollars using an appropriate discount rate.   There are volumes of financial textbooks written on the subject of DCFs.  I will not address them here as the subject is too complicated.  However, one thing to note is that DCFs are the backbone of how Wall Street investment firms value stocks.  Wall Street looks at the future potential of a company and discounts that future potential back to today.  DCFs are also how many VC firms or other investors value early-stage startup companies.  The idea of looking at future potential earnings explains why companies that have no profit or cash flow can be valued for hundreds of millions or billions of dollars.  (Think about Amazon in the early 2000s.)   Reconciling the Data (aka Averaging):   The last step in the valuation process is reconciling the data which I simply call “averaging.”  Now that the analyst has three sets of data (comparable companies, comparable transactions, and DCF) resulting in many different potential values, what is the Target really worth?  The true answer to this question is - whatever a buyer is will pay for it!  A more technical or legal answer might be: what a willing buyer and a willing seller, neither being under a compulsion to buy or sell and both having reasonable knowledge of relevant facts, agree to the value of the Target.   However, the entire reason for a valuation in the first place is to answer the “how much is my company worth?” question prior to or in anticipation of taking the Target to market.     So what do most valuation firms do with the data they have collected? They review the underlying data, the outliers, the overall market, the resulting valuations, etc. based on their expertise.  They then average the data, using some method of weighting the data as part of their proprietary process.  They then come to a range of values for the Target.     Does this Work?   Hopefully, you now have a basic understanding of the valuation process.  You may have noticed that there is a lot of “science” (i.e., math) to the process.  But you may have also noticed that there is some “art” to it as well.  By “art” I mean assumptions, creativity, hunches, etc. used in the valuation process.  It’s not all science.  For example, one valuation company's “proprietary” method of averaging will be different from another company’s, one company’s comparable sets will be different from another company’s, and one company’s terminal value and discount rate will be different from another company’s.  To hammer home the point, two different people at the same company will likely make different assumptions and can therefore come up with different valuations for the same Target.    So the big question you may ask yourself is “do these methods work?”  Given that most valuation companies use similar methods to value larger private or publicly traded companies, my general answer to the question is “yes these valuation methods work,” if for no other reason than if everyone is valuing companies the same way then they should all come to similar conclusions.     However, note that I said larger private or public companies above.  For smaller private companies, I suggest you read another article I wrote called: Company Valuations in the Lower middle-market.      Bob Fiorella   CEO and Founder of First CxO.  Bob Fiorella is a strategic problem solver, M&A advisor, and right-hand man to CEOs and business owners contemplating or dealing with a major change; whether it's restructuring a company, building a finance team, getting a loan, setting the company up for growth, successfully selling the company, etc.  He began his career as an investment banker and worked on several deals including the multibillion-dollar merger of Avery and Dennison.  Over the subsequent two decades, Bob’s career centered around the media, entertainment, packaged goods, wholesale distribution, specialty retail, technology, and software development industries where he took on roles such as SVP Finance, Chief Financial Officer, Chief Operating Officer, Chief Strategy Officer, and independent board member. Bob is the Founder and President of First CxO.  Some of his assignments include being a fractional CFO for a $30mm packaging technology company, a $5mm software development company, and a $25mm e-commerce company.  He is also an advisor to a $500mm franchising company.  Bob holds a BS in Economics from Cornell University and an MBA from UCLA’s Anderson School of Management.  Bob can be reached at 310-422-6858, bob@firstcxo.com . Bob’s “claim to fame” is appearing on Season 13 of America’s Got Talent as part of the Angel City Chorale. They made it to the Semi-Finals.

As fractional CFO and M&A advisor, I frequently come across CEOs and business owners (“Sellers”) who are thinking about selling their company. Frequently, Sellers are skeptical about the need to hire an advisor like me.  Afterall, advisors are not cheap.  For example, an M&A advisor will cost anywhere from 2.5-10% of the overall sale price of the company, depending on the size of the business sale.  Or maybe Sellers do not want to engage an advisor because they think they already know to whom they can sell their company. Or maybe they even have a buyer currently courting them.  So why, then, should a Seller hire an advisor?  The top 6 reasons are below.     Valuation As a business owner, chances are that you do not have a realistic expectation of the value of your company.   I cannot tell you the number of times I have been quoted unrealistic company valuations by potential Sellers.  So rather than guesstimate your company’s worth , why not engage an advisor whose primary occupation is to advise buyers and sellers of companies and can therefore give an objective and experienced business valuation based on tangible data? Make the Market:  One of the primary purposes of an M&A advisor is to find lots of potential buyers for your company.  M&A firms “make a market” for a business sale.  To be clear, one buyer does not make a market.  A market consists of multiple potential buyers.  So, while a Seller may get approached from time to time by one or two possible buyers, that does not mean those buyers represent what the company is really worth. The only way to know what a company is worth is to take the company to market!   The Benefits of Competition:  Running a competitive sale process has the potential to drive several key benefits.  For example, more potential buyers increase the likelihood of more offers.  More offers increase the likelihood of a higher price.  More potential buyers also increase the probability of finding the “right” buyer for your business.  More buyers also increase the company’s leverage during the sale process.  If a Seller is only talking to one buyer, then that one buyer has all of the leverage.    Objectivity:   Let’s face it, most business Sellers only sell a company once in their career if they are lucky .  And when they do, chances are that their experience during the sale process is an emotional rollercoaster.  On the other hand, an experienced M&A advisor will sell hundreds of companies over their career thus giving them insights into what works and does not work when selling a business.  And because an M&A advisor does not have the personal and emotional attachment to the company that an owner, CEO or other member of management have, the M&A advisor should be able to remain objective during the sale process.   By remaining objective, the M&A advisor helps increase the probability of success. Keep an Eye on the Bottom Line:  Using an M&A advisor allows the Seller to keep their focus on operating the business at its highest level during the sale process.   Any slip in company performance during the sale process opens the door to “re-trading” – the practice of renegotiating the purchase price of a company after initially agreeing to a higher price.  One of the key roles of the CEO or owner during a sale process is to make sure the bottom line stays healthy.  So let the M&A advisor focus on keeping the sale process moving forward while the CEO/owner keeps the business humming.   Momentum:  No matter what type of business deal you are working on, if someone does not keep the deal moving forward, then the deal dies.  Since M&A advisors are not distracted by day-to-day operating issues at the company they are trying to sell, and as M&A advisors are mostly compensated based on a success fee, M&A advisors are highly motivated to keep up the momentum during a deal process.  At the end of the day, momentum makes deals.     Bob Fiorella   CEO and Founder of First CxO.  Bob Fiorella is a strategic problem solver, M&A advisor, and right-hand man to CEOs and business owners contemplating or dealing with a major change; whether it's restructuring a company, building a finance team, getting a loan, setting the company up for growth, successfully selling the company, etc.  He began his career as an investment banker and worked on several deals including the multibillion-dollar merger of Avery and Dennison.  Over the subsequent two decades, Bob’s career centered around the media, entertainment, packaged goods, wholesale distribution, specialty retail, technology, and software development industries where he took on roles such as SVP Finance, Chief Financial Officer, Chief Operating Officer, Chief Strategy Officer, and independent board member. Bob is the Founder and President of First CxO.  Some of his assignments include being a fractional CFO for a $30mm packaging technology company, a $5mm software development company, and a $25mm e-commerce company.  He is also an advisor to a $500mm franchising company.  Bob holds a BS in Economics from Cornell University and an MBA from UCLA’s Anderson School of Management.  Bob can be reached at 310-422-6858, bob@firstcxo.com . Bob’s “claim to fame” is appearing on Season 13 of America’s Got Talent as part of the Angel City Chorale. They made it to the Semi-Finals.

Far too many times, I come across business owners and CEOs (owners) who say they have a CFO only to find out when I ask a few questions that the person they call a CFO isn’t a CFO.  In all reality, the owner’s CFO is really their bookkeeper, clerk, office manager, accountant, CPA, controller, chief accounting officer, or, God forbid, their uncle, nephew, spouse, or cousin Sal.  With that type of “CFO,” is it any wonder why the company isn’t growing , or profits have stagnated, or why the owner can’t sleep at night or has no viable exit strategy?   Decoding the Role: Unveiling the Functions of a CFO A real CFO is a strategic business partner, advisor, confidant, customer service person, and mentor to an owner.  Too often, owners think a CFO is supposed to put together their financial statements.  No!  A CFO is not your bookkeeper, accountant, or controller.  That is not their job.  Like any good leader, a true CFO will retain and lead people who are experts in those roles.  A true CFO will set the goals, objectives, and timelines for those tasks and will ultimately be accountable for the results.  But if the CFO is doing those tasks day-to-day, then your CFO is really a Controller. So stop calling them the CFO.   If your CFO doesn’t understand your marketing plans, the sales strategy, how your warehouse operates, who your key customers are and what makes them buy, or who the competitors are, or if they can’t speak clearly and confidently to your investors, bankers, or the board, or they can’t look you in the eye and politely point out problems with your strategy and offer up solutions, then fire them now!    One of my first bosses told me something that locked me into the finance field early on in my career; there are only two people at the company who need to know everything about the business - the CEO and the CFO. A CFO is a business planner.   One thing I have learned through the years is if you are CEO or an owner, it is lonely at the top.  A true CFO should be able to relieve some of that burden. If your CFO isn’t your right-hand man, you need to find one who is.    If you are interested in a valuation, a sale, or in strategic business consulting and are looking for an experienced advisor, please let me know.  Thanks.  Bob Fiorella   CEO and Founder of First CxO.  Bob Fiorella is a strategic problem solver, M&A advisor, and right-hand man to CEOs and business owners contemplating or dealing with a major change; whether it's restructuring a company, building a finance team, getting a loan, setting the company up for growth, successfully selling the company, etc.  He began his career as an investment banker and worked on several deals including the multibillion-dollar merger of Avery and Dennison.  Over the subsequent two decades, Bob’s career centered around the media, entertainment, packaged goods, wholesale distribution, specialty retail, technology, and software development industries where he took on roles such as SVP Finance, Chief Financial Officer, Chief Operating Officer, Chief Strategy Officer, and independent board member. Bob is the Founder and President of First CxO.  Some of his assignments include being a fractional CFO for a $30mm packaging technology company, a $5mm software development company, and a $25mm e-commerce company.  He is also an advisor to a $500mm franchising company.  Bob holds a BS in Economics from Cornell University and an MBA from UCLA’s Anderson School of Management.  Bob can be reached at 310-422-6858, bob@firstcxo.com . Bob’s “claim to fame” is appearing on Season 13 of America’s Got Talent as part of the Angel City Chorale. They made it to the Semi-Finals.

Over the past few years, the term “ fractional ” has become popular in the business consulting world. But what does “fractional” mean? Let us break jobs down into 3 basic categories: Full-time. I think everyone knows what this means - right?  Someone works 40 hours a week exclusively for one company. A full-time role is intended to be permanent and exclusive to the employer. Interim:    For example, a full-time employee leaves a company for some reason (fired, parental leave, etc.) or a company feels the need to hire someone full-time but hasn’t yet.  In these cases, the company is looking to fill a role for a specific period of time. The person filling the role works for the company exclusively for that period of time. Another term for “interim” is “project based.” Fractional. A fractional executive works with multiple companies at the same time (say one day a week per company). They are not full-time, and they are not interim. Using more dated and clearly less sexy terminology, a “fractional” executive is a part-time consultant.   So, what is a Fractional CFO?   A fractional CFO is a strategic advisor to you and your company. They may hire, train, monitor, and lead your internal and external finance and accounting teams , but they themselves don’t do the accounting or booking. However, they will use the information provided by the finance and accounting team and the sales and marketing, operations, legal, technology, and HR teams at the company, as well as information from third parties (e.g., banks, CPAs, etc.) to create analyses, plans, metrics, and other strategic data to advise, guide and mentor a CEO or business owner as s/he looks to the future.   A true fractional CFO is a business planner, not a bean counter. If you hire a CFO to do your accounting and bookkeeping you are likely overpaying for that resource or you are inflating the title of the person doing those tasks. Both are costly to you.  Bob Fiorella   CEO and Founder of First CxO.  Bob Fiorella is a strategic problem solver, M&A advisor, and right-hand man to CEOs and business owners contemplating or dealing with a major change; whether it's restructuring a company, building a finance team, getting a loan, setting the company up for growth, successfully selling the company, etc.  He began his career as an investment banker and worked on several deals including the multibillion-dollar merger of Avery and Dennison.  Over the subsequent two decades, Bob’s career centered around the media, entertainment, packaged goods, wholesale distribution, specialty retail, technology, and software development industries where he took on roles such as SVP Finance, Chief Financial Officer, Chief Operating Officer, Chief Strategy Officer, and independent board member. Bob is the Founder and President of First CxO.  Some of his assignments include being a fractional CFO for a $30mm packaging technology company, a $5mm software development company, and a $25mm e-commerce company.  He is also an advisor to a $500mm franchising company.  Bob holds a BS in Economics from Cornell University and an MBA from UCLA’s Anderson School of Management.  Bob can be reached at 310-422-6858, bob@firstcxo.com . Bob’s “claim to fame” is appearing on Season 13 of America’s Got Talent as part of the Angel City Chorale. They made it to the Semi-Finals.

Understanding the Evolution of FP&A Financial Planning & Analysis (FP&A) has come a long way from simply crunching numbers. It has evolved into a strategic function that helps businesses scale efficiently. Understanding this transformation provides insight into how FP&A can support growth. The Early Foundations of FP&A (1970 - 1990) Originally, FP&A was limited to budgeting and financial forecasting. Businesses relied heavily on static reports that provided little flexibility for real-time decision-making. The Birth of Modern FP&A (1990 - 2010) With the rise of enterprise resource planning (ERP) systems, FP&A teams began leveraging more dynamic financial models. This period saw the introduction of better data analysis tools and automated reporting. FP&A Awakening and Growth (2010 - 2015) During this time, businesses realized that FP&A could do more than just track finances. Companies started using FP&A insights to guide strategic decision-making , predict trends, and manage risks more effectively. Transformation and Maturity (2015 - Today) Today, FP&A is a core part of business strategy, integrating financial data with operational insights. Businesses that invest in FP&A capabilities are more agile, making informed decisions that fuel sustainable growth. What Elite FP&A Looks Like Today Modern FP&A teams are no longer just finance specialists; they are strategic advisors. Businesses that fully leverage FP&A gain a competitive edge by making data-driven decisions that optimize efficiency and profitability. The Responsibilities of a Modern FP&A Team An effective FP&A team is responsible for: Budgeting and forecasting Financial modeling Performance tracking and reporting Strategic planning Risk assessment How FP&A Drives Business Growth A well-structured FP&A function impacts: Revenue Growth : Identifying new revenue opportunities based on financial trends. Cost Optimization : Streamlining expenses without compromising operational effectiveness. Strategic Decision-Making : Providing leaders with actionable insights for expansion and scaling. Risk Management : Forecasting potential threats and preparing contingency plans. Leveraging FP&A for Business Scaling Scaling a business requires more than increasing revenue—it demands operational efficiency and financial discipline. Here’s how FP&A contributes to business scaling: Aligning Financial Strategy with Business Goals FP&A ensures that financial planning aligns with long-term business objectives, helping companies make sound investment decisions. Improving Cash Flow Management Strong FP&A practices help businesses maintain healthy cash flow by forecasting inflows and outflows, preventing liquidity issues. Scenario Planning for Growth FP&A allows businesses to create multiple financial scenarios, preparing them for different growth trajectories and market conditions. Data-Driven Resource Allocation FP&A teams analyze performance metrics to ensure resources are allocated effectively across departments, optimizing productivity and profitability. FAQs Why is FP&A important for scaling businesses? FP&A provides the financial insights and strategic planning needed to grow a business efficiently while minimizing risks. How does FP&A differ from traditional accounting?   While accounting focuses on historical financial data, FP&A is forward-looking, using data to guide decision-making and business strategy. What tools do FP&A teams use?   Common FP&A tools include financial modeling software, data visualization platforms, and enterprise performance management tools in ERP systems. When should a company invest in FP&A? Businesses should establish FP&A functions early in their growth phase to ensure financial discipline and strategic planning. Bob Fiorella   CEO and Founder of First CxO.  Bob Fiorella is a strategic problem solver, M&A advisor, and right-hand man to CEOs and business owners contemplating or dealing with a major change; whether it's restructuring a company, building a finance team, getting a loan, setting the company up for growth, successfully selling the company, etc.  He began his career as an investment banker and worked on several deals including the multibillion-dollar merger of Avery and Dennison.  Over the subsequent two decades, Bob’s career centered around the media, entertainment, packaged goods, wholesale distribution, specialty retail, technology, and software development industries where he took on roles such as SVP Finance, Chief Financial Officer, Chief Operating Officer, Chief Strategy Officer, and independent board member. Bob is the Founder and President of First CxO.  Some of his assignments include being a fractional CFO for a $30mm packaging technology company, a $5mm software development company, and a $25mm e-commerce company.  He is also an advisor to a $500mm franchising company.  Bob holds a BS in Economics from Cornell University and an MBA from UCLA’s Anderson School of Management.  Bob can be reached at 310-422-6858, bob@firstcxo.com . Bob’s “claim to fame” is appearing on Season 13 of America’s Got Talent as part of the Angel City Chorale. They made it to the Semi-Finals.  References Harvard Business Review on Financial Planning Investopedia: The Importance of FP&A McKinsey & Company: FP&A Best Practices

Budgeting and forecasting are two essential financial tools, but they serve different purposes. While both help businesses plan for the future, they aren’t interchangeable. Understanding their differences can improve financial management, enhance decision-making, and drive sustainable growth. What is Budgeting? A budget  is a financial plan that outlines expected income and expenses over a set period, typically a year. It provides a framework for spending and helps businesses allocate resources efficiently. Key Characteristics of a Budget Sets financial goals and spending limits Covers a fixed period (monthly, quarterly, annually) Helps businesses control costs and optimize cash flow Acts as a benchmark for measuring financial performance Why Budgeting Matters A well-structured budget keeps a business financially healthy by preventing overspending, ensuring funds are available for necessary expenses, and supporting strategic investments. What is Forecasting? A forecast  is a dynamic financial projection that estimates future performance based on historical data, market trends, and expected business conditions. Unlike a budget, a forecast is flexible and updated regularly. Key Characteristics of Forecasting Uses real-time data to predict financial outcomes Can be short-term (weekly, monthly) or long-term (quarterly, annually) Adapts to changes in business performance and market trends Helps businesses anticipate risks and opportunities Why Forecasting Matters Forecasting helps businesses stay agile by providing updated insights into financial performance. It allows companies to adjust strategies based on current trends rather than sticking to a static budget. Budgeting vs. Forecasting: The Key Differences Feature Budgeting Forecasting Purpose Sets financial targets and spending plans Predicts future performance and adjusts strategies Timeframe Fixed period (e.g., one year) Continuous and updated regularly Flexibility Static, reviewed periodically Dynamic, changes based on new data Data Used Past financial data, fixed assumptions Real-time data, market trends, and business performance Focus Expense control and resource allocation Growth planning and risk management How Budgeting and Forecasting Work Together While budgeting and forecasting serve different purposes, they are most effective when used together: Budgeting provides structure  – It sets financial limits and ensures spending aligns with business goals. Forecasting keeps businesses agile  – It updates financial expectations based on new data, helping businesses react to opportunities and challenges. Together, they support strategic decision-making  – A strong budget prevents overspending, while a forecast ensures financial plans remain relevant. When Should You Use Budgeting vs. Forecasting? Use budgeting when:  Setting financial goals, planning annual expenses, or allocating resources for specific projects. Use forecasting when:  Adjusting to market changes, making real-time financial decisions, or projecting future revenue trends. FAQs Can a business operate without a budget? While it’s possible, operating without a budget increases the risk of financial mismanagement, overspending, and lack of financial discipline. How often should financial forecasts be updated?   Forecasts should be reviewed monthly or quarterly to ensure accuracy and reflect the latest financial data and market conditions. Do startups need both budgeting and forecasting? Yes! Budgeting helps manage limited resources, while forecasting allows startups to adapt quickly to changing market conditions. How do budgeting and forecasting impact financial strategy?   Budgeting controls spending and ensures profitability, while forecasting helps businesses make informed decisions about future growth. Bob Fiorella   CEO and Founder of First CxO.  Bob Fiorella is a strategic problem solver, M&A advisor, and right-hand man to CEOs and business owners contemplating or dealing with a major change; whether it's restructuring a company, building a finance team, getting a loan, setting the company up for growth, successfully selling the company, etc.  He began his career as an investment banker and worked on several deals including the multibillion-dollar merger of Avery and Dennison.  Over the subsequent two decades, Bob’s career centered around the media, entertainment, packaged goods, wholesale distribution, specialty retail, technology, and software development industries where he took on roles such as SVP Finance, Chief Financial Officer, Chief Operating Officer, Chief Strategy Officer, and independent board member. Bob is the Founder and President of First CxO.  Some of his assignments include being a fractional CFO for a $30mm packaging technology company, a $5mm software development company, and a $25mm e-commerce company.  He is also an advisor to a $500mm franchising company.  Bob holds a BS in Economics from Cornell University and an MBA from UCLA’s Anderson School of Management.  Bob can be reached at 310-422-6858, bob@firstcxo.com . Bob’s “claim to fame” is appearing on Season 13 of America’s Got Talent as part of the Angel City Chorale. They made it to the Semi-Finals.  References Harvard Business Review on Financial Planning Investopedia: Budgeting vs. Forecasting Small Business Administration: Financial Planning Guide

Running a business isn’t just about growth—it’s about smart financial management. Many businesses wait too long before seeking financial expertise, leading to cash flow issues, poor budgeting, and missed opportunities. If you’re experiencing any of these warning signs, it may be time to bring in a fractional CFO before it’s too late. What is a Fractional CFO? A fractional CFO is a part-time or contract-based financial expert who helps businesses improve their financial health without the cost of a full-time CFO. Fractional CFO vs. Traditional CFO Cost:  A traditional CFO comes with a hefty salary, while a fractional CFO works on an as-needed basis, making them more affordable. Commitment:  Unlike a full-time CFO, a fractional CFO offers flexible support tailored to your business needs. Expertise:  Many fractional CFOs have worked across industries, bringing a broad perspective on financial strategy. Fractional CFO vs. Bookkeeper Bookkeepers  track and record financial transactions. Fractional CFOs  focus on strategic financial planning, forecasting, and improving profitability. Who Needs a Fractional CFO? If your business is growing but struggling to manage financial complexities, a fractional CFO can help. Here are some key indicators that it’s time to hire one. When Should You Hire a Fractional CFO? 1. You’re Struggling with Cash Flow Management Can’t figure out why your revenue isn’t translating to profit? Struggling to cover expenses even when sales are up? A fractional CFO can identify cash flow bottlenecks and create strategies to maintain liquidity. 2. You Lack a Clear Financial Strategy Do you have a roadmap for growth? Are financial decisions being made reactively instead of strategically? A fractional CFO helps you create a solid financial plan aligned with your business goals. 3. Fundraising is Overwhelming Need capital but unsure how to approach investors? Struggling to create financial models for fundraising? A fractional CFO can develop detailed financial projections and investor-friendly reports to increase funding success. 4. You’re Losing Profitability Seeing increased revenue but declining profits? Unsure where to cut costs without sacrificing growth? A fractional CFO analyzes your expenses, pricing strategies, and margins to maximize profitability. 5. You’re Facing Rapid Growth Expanding too fast and worried about financial stability? Struggling to scale operations efficiently? A fractional CFO ensures your financial infrastructure can handle rapid expansion. 6. Your Business is Preparing for an Exit or Acquisition Want to sell your business but don’t know if it’s financially ready? Need help increasing valuation before an acquisition? A fractional CFO prepares financial statements, optimizes profitability, and ensures a smooth transition. How Much Does a Fractional CFO Cost? The cost of hiring a fractional CFO varies based on: Complexity of Financials:  Businesses with intricate operations require deeper analysis. System Design & Implementation:  Setting up financial software and reporting tools impacts cost. Level of Involvement:  Some businesses need ongoing support, while others require a short-term engagement. Measuring the ROI of a Fractional CFO Wondering if hiring a fractional CFO is worth it? Look at: Revenue Growth:  Are financial strategies leading to increased sales and profits? Cost Reduction:  Are expenses optimized without hurting operations? Financial Stability:  Is cash flow more predictable and sustainable? Investor Readiness:  Are financial reports and projections investor-friendly? Wrap-Up: Choose the Right Fractional CFO for Your Business Not all fractional CFOs are the same. When hiring one, consider: Their industry experience Their ability to align with your business goals Their track record of improving financial performance FAQs How do I know if my business needs a fractional CFO? If you’re experiencing cash flow problems, struggling with financial planning, or preparing for an acquisition, it’s time to consider a fractional CFO. How long should I keep a fractional CFO?   Some businesses hire them for short-term projects, while others retain them for ongoing financial leadership. Can a fractional CFO replace a full-time CFO? For small and mid-sized businesses, yes. Larger companies may need a full-time CFO but can use a fractional CFO as interim support. Bob Fiorella   CEO and Founder of First CxO.  Bob Fiorella is a strategic problem solver, M&A advisor, and right-hand man to CEOs and business owners contemplating or dealing with a major change; whether it's restructuring a company, building a finance team, getting a loan, setting the company up for growth, successfully selling the company, etc.  He began his career as an investment banker and worked on several deals including the multibillion-dollar merger of Avery and Dennison.  Over the subsequent two decades, Bob’s career centered around the media, entertainment, packaged goods, wholesale distribution, specialty retail, technology, and software development industries where he took on roles such as SVP Finance, Chief Financial Officer, Chief Operating Officer, Chief Strategy Officer, and independent board member. Bob is the Founder and President of First CxO.  Some of his assignments include being a fractional CFO for a $30mm packaging technology company, a $5mm software development company, and a $25mm e-commerce company.  He is also an advisor to a $500mm franchising company.  Bob holds a BS in Economics from Cornell University and an MBA from UCLA’s Anderson School of Management.  Bob can be reached at 310-422-6858, bob@firstcxo.com . Bob’s “claim to fame” is appearing on Season 13 of America’s Got Talent as part of the Angel City Chorale. They made it to the Semi-Finals.  References Harvard Business Review on Financial Leadership Investopedia: Understanding Fractional CFOs Small Business Administration: Financial Strategy

Economic downturns can be tough, but businesses that invest in financial coaching can navigate uncertainty with confidence. A recession-proof business isn’t about avoiding risks—it’s about being prepared. Here’s how financial coaching helps build resilience and long-term success. What is Financial Coaching? Financial coaching is a strategic service that helps business owners improve financial management, optimize cash flow, and make informed decisions. Unlike traditional accounting, financial coaching focuses on forward-looking strategies that strengthen financial health . Financial Coaching vs. Traditional CFOs and Bookkeepers Financial Coach vs. CFO:  CFOs manage a company’s entire financial strategy, while financial coaches help business owners develop financial literacy and decision-making skills. Financial Coach vs. Bookkeeper:  Bookkeepers handle daily transactions, while financial coaches focus on budgeting, forecasting, and long-term financial planning. Who Needs Financial Coaching? Financial coaching is beneficial for: Small Business Owners:  Learning how to manage cash flow and prepare for downturns. Startups:  Understanding financial risks and growth strategies. Scaling Businesses :  Developing systems to manage increasing financial complexity. Struggling Businesses:  Recovering from debt or financial mismanagement. Key Strategies for a Recession-Proof Business 1. Strengthen Cash Flow Management Cash flow is the lifeline of any business. During a recession, businesses with strong cash reserves and efficient cash flow management are more likely to survive. Monitor incoming and outgoing cash regularly. Reduce unnecessary expenses while maintaining productivity. Negotiate better terms with vendors and suppliers. 2. Build an Emergency Fund A financial cushion helps businesses weather economic downturns. Aim to have 3-6 months' worth of operating expenses saved. Keep the funds in a separate, easily accessible account. 3. Focus on Budget Planning Financial coaching helps businesses create flexible budgets that can adjust to changing economic conditions. Prioritize essential expenses and reduce non-essential spending. Identify cost-saving opportunities without cutting revenue-generating activities. 4. Improve Financial Decision-Making A key part of financial coaching is developing the ability to make data-driven decisions rather than emotional ones. Use financial forecasting to anticipate future challenges. Analyze financial reports regularly to stay informed. Make calculated investments that align with long-term goals. 5. Diversify Revenue Streams Relying on a single source of revenue is risky during a downturn. Financial coaches help businesses identify new income opportunities. Expand product or service offerings. Explore different sales channels, such as e-commerce or subscription models. 6. Strengthen Pricing and Value Propositions During recessions, price sensitivity increases. Businesses must balance competitive pricing with maintaining profit margins. Assess pricing strategies to ensure profitability. Highlight value to customers rather than competing solely on price. Measuring the Impact of Financial Coaching To determine if financial coaching is working, track these key performance indicators (KPIs): Revenue Growth:  Is income stable or increasing? Profit Margins:  Are costs under control while maintaining profitability? Cash Flow Health:  Can the business cover expenses without financial strain? Debt Reduction:  Is debt being managed or decreasing? FAQs How does financial coaching help during a recession? Financial coaching provides strategies for managing cash flow, cutting costs effectively, and making informed financial decisions to stay resilient. When should I start financial coaching for my business? It’s best to start before financial trouble arises, but it’s never too late to seek guidance and improve financial health. What’s the biggest mistake businesses make during a recession? Cutting essential costs that drive revenue, such as marketing and customer service, instead of optimizing overall financial management. Can financial coaching replace a CFO? For small businesses, yes. Financial coaching provides financial strategy without the full-time cost of a CFO. Bob Fiorella   CEO and Founder of First CxO.  Bob Fiorella is a strategic problem solver, M&A advisor, and right-hand man to CEOs and business owners contemplating or dealing with a major change; whether it's restructuring a company, building a finance team, getting a loan, setting the company up for growth, successfully selling the company, etc.  He began his career as an investment banker and worked on several deals including the multibillion-dollar merger of Avery and Dennison.  Over the subsequent two decades, Bob’s career centered around the media, entertainment, packaged goods, wholesale distribution, specialty retail, technology, and software development industries where he took on roles such as SVP Finance, Chief Financial Officer, Chief Operating Officer, Chief Strategy Officer, and independent board member. Bob is the Founder and President of First CxO.  Some of his assignments include being a fractional CFO for a $30mm packaging technology company, a $5mm software development company, and a $25mm e-commerce company.  He is also an advisor to a $500mm franchising company.  Bob holds a BS in Economics from Cornell University and an MBA from UCLA’s Anderson School of Management.  Bob can be reached at 310-422-6858, bob@firstcxo.com . Bob’s “claim to fame” is appearing on Season 13 of America’s Got Talent as part of the Angel City Chorale. They made it to the Semi-Finals.  References Harvard Business Review on Financial Resilience Investopedia: Financial Coaching Benefits Small Business Administration: Surviving Economic Downturns

Running a business is tough, and financial stress is one of the biggest challenges entrepreneurs face. Understanding the psychology behind money can help business owners manage stress, make better financial decisions, and develop a healthier relationship with money. Understanding Financial Stress in Business Money can be an emotional topic. Whether it's cash flow issues, debt, or uncertainty about the future, financial stress affects business owners in many ways. It can lead to anxiety, poor decision-making, and even burnout. Common Causes of Financial Stress for Business Owners Inconsistent Cash Flow:  Irregular revenue makes it difficult to cover expenses and plan for the future. Debt and Financial Obligations:  Loan repayments and outstanding debts can create overwhelming pressure. Uncertainty About Growth:  Many entrepreneurs struggle with financial planning and worry about the next steps for scaling their businesses. Lack of Financial Literacy:  Not understanding financial reports, taxes, or investment opportunities can lead to costly mistakes. How Money Mindset Affects Decision-Making The way business owners think about money significantly impacts their financial health . Some common money mindsets include: Scarcity vs. Abundance Mindset Scarcity Mindset:  Business owners with a scarcity mindset focus on what they lack, often avoiding risks or missing growth opportunities. Abundance Mindset:  Those with an abundance mindset view money as a tool for growth, investing wisely, and taking calculated risks. Emotional Spending vs. Strategic Investing Emotional Spending:  Making impulsive financial decisions based on fear or stress often leads to cash flow problems. Strategic Investing:  Smart business owners allocate resources based on data, market trends, and long-term goals. Strategies to Overcome Financial Stress 1. Improve Financial Literacy Knowledge is power. Business owners should educate themselves on key financial concepts like budgeting, forecasting, and financial planning . Consider working with a financial coach or CFO to gain deeper insights. 2. Build an Emergency Fund Setting aside a financial cushion can help reduce stress during slow months or unexpected downturns. 3. Implement Budget Planning A well-structured budget keeps business expenses in check and ensures financial stability. Regularly reviewing and adjusting the budget helps prevent financial surprises. 4. Seek Professional Guidance Hiring a fractional CFO or financial advisor can provide strategic direction and help with complex financial decisions like fundraising and value extraction. 5. Practice Mindfulness and Stress Management Money stress can take a toll on mental health. Practicing mindfulness, meditation, and stress management techniques can help business owners stay focused and make better financial choices. FAQs How can I stop worrying about money in my business? Creating a solid financial plan, monitoring cash flow, and seeking expert advice can help reduce financial anxiety. What is the best way to manage financial stress? Developing a healthy money mindset, budgeting effectively, and building an emergency fund can significantly lower financial stress. How does financial literacy help business owners? Understanding financial reports, taxes, and cash flow helps business owners make informed decisions and avoid costly mistakes. Is hiring a fractional CFO worth it?   Yes! A fractional CFO provides expert financial guidance without the cost of a full-time CFO, helping businesses optimize financial strategy. Bob Fiorella   CEO and Founder of First CxO.  Bob Fiorella is a strategic problem solver, M&A advisor, and right-hand man to CEOs and business owners contemplating or dealing with a major change; whether it's restructuring a company, building a finance team, getting a loan, setting the company up for growth, successfully selling the company, etc.  He began his career as an investment banker and worked on several deals including the multibillion-dollar merger of Avery and Dennison.  Over the subsequent two decades, Bob’s career centered around the media, entertainment, packaged goods, wholesale distribution, specialty retail, technology, and software development industries where he took on roles such as SVP Finance, Chief Financial Officer, Chief Operating Officer, Chief Strategy Officer, and independent board member. Bob is the Founder and President of First CxO.  Some of his assignments include being a fractional CFO for a $30mm packaging technology company, a $5mm software development company, and a $25mm e-commerce company.  He is also an advisor to a $500mm franchising company.  Bob holds a BS in Economics from Cornell University and an MBA from UCLA’s Anderson School of Management.  Bob can be reached at 310-422-6858, bob@firstcxo.com . Bob’s “claim to fame” is appearing on Season 13 of America’s Got Talent as part of the Angel City Chorale. They made it to the Semi-Finals.  References Harvard Business Review on Financial Mindset Investopedia: Managing Business Finances Small Business Administration: Financial Health

Bringing in a fractional CFO can be a game-changer for your business. Whether you’re looking to scale, improve cash flow, or navigate complex financial challenges, a fractional CFO helps drive strategy and financial health . But what happens in the first 90 days? Let’s break it down.. The First 90 Days: What to Expect Your fractional CFO will follow a structured approach to assess, plan, and implement financial strategies tailored to your business. Phase 1: Financial Assessment (Weeks 1-4) The first month is all about understanding your business and financial landscape. Review of Financial Statements : Analyzing balance sheets, income statements, and cash flow reports. Operational Efficiency Audit : Looking at spending patterns and cost-saving opportunities. Identifying Risks : Spotting areas of concern such as cash flow gaps or high expenses. Understanding Business Goals : Aligning financial strategies with growth objectives. Phase 2: Strategic Planning (Weeks 5-8) Once the assessment is complete, the fractional CFO starts developing a tailored financial strategy. Budget Planning : Creating a financial roadmap to optimize spending and investments. Value Extraction : Identifying cost savings, profit opportunities and improving financial efficiency. Strategic Decision-Making Support : Providing insights to guide business expansion, hiring, legal, and pricing strategies. Phase 3: Implementation & Execution (Weeks 9-on) The final phase is about putting strategies into action and refining financial processes. Cash Flow Management : Ensuring liquidity and financial stability. Training & Team Alignment : Educating key team members on financial best practices. Ongoing Monitoring : Setting up KPIs to track financial progress. System & Process Improvements : Implementing tools for financial tracking and reporting. FAQs When should I hire a fractional CFO?   If you’re experiencing rapid growth, struggling with cash flow, or preparing for an acquisition, a fractional CFO can help. How long should I keep a fractional CFO? Some businesses hire them for short-term projects, while others retain them for ongoing financial leadership. Can a fractional CFO replace a full-time CFO? For smaller businesses, yes. For larger companies, a fractional CFO can provide interim support until a full-time hire is necessary. Bob Fiorella   CEO and Founder of First CxO.  Bob Fiorella is a strategic problem solver, M&A advisor, and right-hand man to CEOs and business owners contemplating or dealing with a major change; whether it's restructuring a company, building a finance team, getting a loan, setting the company up for growth, successfully selling the company, etc.  He began his career as an investment banker and worked on several deals including the multibillion-dollar merger of Avery and Dennison.  Over the subsequent two decades, Bob’s career centered around the media, entertainment, packaged goods, wholesale distribution, specialty retail, technology, and software development industries where he took on roles such as SVP Finance, Chief Financial Officer, Chief Operating Officer, Chief Strategy Officer, and independent board member. Bob is the Founder and President of First CxO.  Some of his assignments include being a fractional CFO for a $30mm packaging technology company, a $5mm software development company, and a $25mm e-commerce company.  He is also an advisor to a $500mm franchising company.  Bob holds a BS in Economics from Cornell University and an MBA from UCLA’s Anderson School of Management.  Bob can be reached at 310-422-6858, bob@firstcxo.com . Bob’s “claim to fame” is appearing on Season 13 of America’s Got Talent as part of the Angel City Chorale. They made it to the Semi-Finals.  References Harvard Business Review on Financial Leadership Investopedia: Understanding Fractional CFOs Small Business Administration: Financial Strategy