Its been a few months since we have integrated consulting as part of our services at Avila Financial Solutions, in the beginning, it was tricky to really say whether we wanted to provide financial or commercial advice, but then it dawned on us. Finance is a consequence of commercial decisions, at least in an analytical perspective.
Financial Analysis and Advisory in Nature:
Financial consulting is advice derived from analyzing your business or personal situation through financial methods, whether being by reading financial statements, ratios, setting up investment plans or tax structures. It is all about numbers and money, nothing else. And from there using financial products, services and markets to build a plan to achieve what you want to achieve. Whether it is financial planning, investment advice, mortgage broking, etc… it is all around the financial world, and sometimes this can be quite different from the day to day world you work in.
“Financial consultants work with companies or individuals to plan for their financial futures by offering information and guidance on topics that include taxes, investments and insurance decisions. Often called financial advisors, theseconsultants work closely with clients to offer personalized financial advice” – Study.com
Why do we think finance is a result of commercial decisions?
Think about your Profit and Loss statement, or even more simple, your bank statement. It is the foundation for any financial advice and analysis, yet it is actually meaningless if you don’t understand each of the transactions, each line is a result of a commercial decision, whether taking payment from a client, paying a supplier, buying a coffee, they are all decisions that end up having a financial consequence. Therefore we truly believe commercial and business consulting can add more value to your business than simple financial advice.
What does business consulting actually mean?
Business consulting for me is about putting together a strategy that can allow you as a business owner to keep an eye on the big picture of your company while you work on daily tasks, at the same time it maximizes your productivity and effectiveness on those tasks.Simply speaking it looks at your business and where it is, puts where you want to be and then analyses current strategies (marketing plans, business plans etc…) and presents a way to improve these already created strategies at the same it integrates them in synergy with other processes that can allow your business to reach your goals in a straightforward way.
“Management or business consulting is the practice of helping organizations to improve their performance, operating primarily through the analysis of existing organizational problems and the development of plans for improvement”
In summary:
You are probably thinking that these two types of consulting areas overlap in quite a number of points, and you would be right. The critical difference is that financial consulting can be quite inflexible sometimes, I.E. You will invest 20% in real estate, 30% in foreign shares, 40% in local shares and 10% in high-risk investments, and it will always depend on financial analysis or capital. Whereas strategy and business consulting are more focused on using your current business processes and resources and integrate them with new and effective ways of maximizing productivity, consequently letting you achieve your goals as planned.