Episode 3: What is the Role of the Finance Department in Evaluating New Business Opportunities

In Episode 3 of #ASKaCFO James Vanreusel discusses more corporate finance questions. This week the subject is the role of a finance department in evaluating new business opportunities.

The main goal here is to ensure your company does not run out of money when taking on a new project. There are four key questions that you have to ask yourself before in order to determine if you have enough cash- even if the project will be profitable quickly.

What is the gross margin of the project expect to be?
How much overhead will need to be added?
How long will it take to get paid?
What is the size of the project and the amount of time until completion?

The answer to these questions tells you how much $ must be available at inception to be able to take on a new project.

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Whatever stage you’re at in business, you need to be all over the numbers. In posts like this, we aim to offer bite-size food for thought – but in a few hundred words, we can only do so much.

If you’re ready to build your financial muscle, how about a FREE copy of James Vanreusel’s (highly-acclaimed) book for CEOs?