u/Dry_Community5749

Most small manufacturers are just handing finances themselves. As business grows, many use an admin, most their spouses. At what point does a business need a CFO. Most small businesses can't afford a full time CFO so they seem to use part time or a fractional CFO.

At what point does it make sense to bring in a CFO?

Note: I'm not selling anything. I'm looking at buying a small manufacturing business. Many I spoke to are struggling to grow, not for lack of work but being unable to handle complexity esp processing AP and AR. Maybe a fractional CFO can streamline the business?

I worked in corporate all my life and moving into small business now. Trying to understand the nuances of small business

In corporate, I was given a credit card and there were rules on usage esp meals. Things I could expense were:

1. Having meals with clients/suppliers, etc - This was consider business entertainment meal

2. If I'm travelling, anything outside my office I could expense for personal meals.

3. If I'm taking the team out for lunch, I could expense it

4. If I order food to be delivered to office for the team I could expense it

5. If I'm taking an employee of another team for lunch or my own team member came from another city to meet me, I could expense that.

Now it seems, in small business only 1 is considered to be expense? Not sure about 2. And for 3/4/5 I can only expense 50%. Is that right?

Edit: I'm not selling anything, I'm not creating a new expense report software to push to small businesses. Have a look at my profile if you are in doubt

Edit 2: I'm in the US

BG: I was recently laid off and instead of going back, I'm looking at acquiring a small manufacturing business.

I come across both manufacturing and services business.

I’ve been thinking through a key difference between these two businesses, especially from an operational and downside protection standpoint.

In a typical manufacturing business, you’re buying:

- Physical assets (machines, equipment)

- Process knowledge / IP

- A trained workforce to operate it

My assumption: If things go sideways post-close and employees leave, the business may take a hit, but you still retain hard assets + process know-how to rebuild over time.

In contrast, with industrial services (field service, maintenance, repair, install, etc.):

- There are minimal hard assets

- Most of the value sits in people + relationships + tacit knowledge

My assumption: If key technicians or crews walk out, you lose institutional knowledge + customer continuity. In many cases, the business can deteriorate very quickly.

How do you handle this? How to plan for key employees leaving in services businesses?