Companies in 2013 are approaching part-time CFO services completely differently than what we have seen over the last few years. Companies are investing in their growth opportunities by engaging a true part-time CFO to help drive financial performance (top and bottom line results, financial operations and team) that the CEOs are seeing with their pipelines. This is refreshing and positive since the last few years were focused on a lot of turnaround and cost
cutting measures.

Sergei Galeano has joined the CFO team as a Principal. He has over 20 years' experience in senior financial leadership positions. Sergei is a problem solving executive with vast financial management experience including Big 4 Public Accounting. Having served as an auditor, controller, CFO and COO, he has accumulated significant experience in strategic planning, cash and debt management, expense control, GAAP reporting and manufacturing/operational analysis. He has been involved in all aspects of the business cycle including growth, turnaround and liquidation with a proven record of leadership, integrity, a strong work ethic and exceptional business acumen.

Mr. Galeano has utilized his strengths in business and cost analysis, budgeting, forecasting and cash management to drive positive business results. His key to success has been his ability to serve as a business partner and trusted advisor to senior management and facilitator to department heads and all areas of operation. Sergei has served as CFO for a variety of companies including, most recently, a heavy equipment distributor, a window and door manufacturer and an international life sciences business. During his tenure with the international life sciences business, the implementation of sales strategy changes and cost structure adjustments reversed the plummeting sales trend and restored profitability. He then oversaw the wind down of operations as the business transitioned to new locations after the sale to a competitor. In another role, Sergei played a key role in establishing sales and operating strategies and directing expansion efforts that resulted in an annual revenue increase from $15 million to over $40 million.

Mr. Galeano holds a BS in Accounting from Miami University in Oxford, Ohio where he graduated cum laude. He is a Certified Public Accountant, licensed in the state of Ohio and is a member of the Association for Corporate Growth (ACG). 

Your Cost

Do you know your cost?  Many ERP systems are fairly well suited to help you with this, but only if you put the right information in.  Start by identifying the Direct Costs associated with your product: Those costs directly associated with your product such as labor and parts.  These are usually also called Variable Costs as they vary dependent on volume.

You will also have Fixed Costs: These are costs that don't change (at least not regularly) and are not dependent on volume.  Examples may be a building or equipment lease payment.  Indirect Costs: These are costs associated with the product but cannot be directly associated in a reasonably quantifiable manner.  Examples may be a supervisor's wage or general insurance.  Then you have Mixed Costs:  Those costs that have attributes of both Fixed and Variable.  A good example may be delivery costs that include a fixed vehicle lease component and a variable fuel component.

The keys to utilizing costs are to:  

1) Identify them.

2) Keep them current - you must continually ensure that you are using relevant information.  Perfection is not the goal here, but reasonable proximity to actual costs is imperative.

3) Associating them with the products and services you sell to determine profitability.

This last one is often the toughest.  Is there really an easy or practical way to associate the supervisor's wages or insurance with each product?  This is where analysis and decision making take over to determine the cost-benefit of the level of detail
to include.

And don't forget your overhead costs - Administrative costs, advertising, IT costs, supplies, etc.  The pricing structure has to ensure these costs are covered also.

Your Market

Do you know what is important to your customer base?  Have you talked to them lately?  What are they willing to pay for; i.e. features, security, service, reliability?  Do you know what your competition is charging and what kind of results they are getting?  Many companies just slap a markup on their costs without any perception of what the market is willing to pay.

Your Value

What do you bring to the table that your competition doesn't?  Or at least what can you persuade your customers that you give them that they are not going to get elsewhere.  Find ways to differentiate your product or service and "sell" that added value.  However, as noted above, you must know your market, because sometimes they just don't care if your product does something extra or you provide additional service.  Whatever the selling strategy is, it should be enterprise wide and consistent to avoid confusion in the marketplace.

Your Goal

What is your goal?  Why are you in business?  Usually it is to make money and provide a reasonable return on your investment.  So as noted above, you have to price your products in a way that allows you to cover the cost of making/providing that product or service, covering overhead costs, providing for growth if desired and making some amount of profit.

There may be other goals also such as market share or using loss leaders to make headway into a new market, but don't forget the overriding goal - usually making money.