Fractional CFO vs. Bookkeeper vs. Full-Time CFO: Which Does a Trade Contractor Need?

Most trade contractors start with a bookkeeper—someone who records transactions, reconciles accounts, and makes sure the books are clean enough for tax time. That is the right call at $500K or $1M in revenue. But somewhere between $2M and $5M, a gap opens. The bookkeeper keeps the score. Nobody is coaching the game.

That gap is where contractors stall, leak margin, overpay taxes, and run into cash flow surprises they should have seen coming. The question is what fills it: a fractional CFO, a full-time CFO, or just a better bookkeeper? The answer depends on your revenue, your complexity, and what you actually need done.

What Each Role Actually Does

Bookkeeper

A bookkeeper is backward-looking. Their job is to record what already happened: categorize transactions, reconcile bank accounts, run payroll, manage accounts payable and receivable, and produce financial statements. A great bookkeeper gives you clean, accurate data. What they do not do—and should not be expected to do—is tell you what that data means or what to do about it.

Cost: $500–$2,500 per month for a trade contractor, depending on transaction volume and complexity. In-house bookkeepers run $40,000–$55,000 per year fully loaded.

Best for: Every business at every stage. You always need clean books. The bookkeeper is the foundation.

Fractional CFO

A fractional CFO is forward-looking. They take the data the bookkeeper produces and turn it into decisions: where is margin leaking, which service lines should you grow or cut, how should you structure your compensation for tax efficiency, what does your cash flow look like 90 days out, are you priced correctly, and what needs to change before you can sell the business or scale it. They typically work 2–5 days per month—enough to drive strategy without the cost of a full-time executive.

Cost: $3,000–$8,000 per month for trade contractors. Some engage on a project basis (like a $5,000 Financial Health Assessment) before committing to ongoing work.

Best for: Contractors doing $2M–$15M who need CFO-level thinking but cannot justify (or do not need) a full-time hire.

Full-Time CFO

A full-time CFO is an executive team member who manages all financial operations: strategy, forecasting, banking relationships, insurance, risk management, M&A due diligence, investor relations, and financial team oversight. They are in the building every day, participating in leadership decisions across every function.

Cost: $150,000–$300,000+ per year in total compensation (salary, benefits, bonus). For a contractor doing $5M, that is 3–6% of revenue dedicated to a single executive role.

Best for: Companies above $15M–$20M in revenue with complex operations, multiple locations, or active M&A activity. Below that threshold, you are paying for capacity you do not use.

Side-by-Side Comparison

Capability	Bookkeeper	Fractional CFO	Full-Time CFO
Transaction recording	✓	—	Oversees
Monthly financial statements	✓	Reviews & interprets	✓
Cash flow forecasting	—	✓	✓
KPI tracking & benchmarking	—	✓	✓
Tax strategy & planning	—	✓	✓
Pricing & margin analysis	—	✓	✓
Exit & succession planning	—	✓	✓
Banking & lending relationships	—	As needed	✓
Daily operational finance	—	—	✓
Annual cost	$6K–$55K	$36K–$96K	$150K–$300K+
Revenue sweet spot	All stages	$2M–$15M	$15M+

The Most Common Mistake: Expecting Your Bookkeeper to Be Your CFO

This is the single most frequent financial management mistake I see in trade contracting businesses. The owner gets monthly statements from the bookkeeper and assumes that is financial management. It is not. The bookkeeper tells you that gross margin was 22% last month. They do not tell you that 22% is below the 25–35% benchmark, that the shortfall is concentrated in commercial installs where your labor burden is 40% higher than your estimates assume, and that fixing it requires repricing three specific job categories.

The gap between "here are your numbers" and "here is what your numbers mean and what to do about them" is the entire value proposition of a CFO function. Without it, you are flying with instruments you cannot read.

When to Make the Move

• Under $1M revenue: Bookkeeper only. Keep costs low, keep books clean.
• $1M–$2M revenue: Bookkeeper plus occasional project-based CFO work (tax planning, entity structuring, a one-time financial assessment).
• $2M–$5M revenue: Bookkeeper plus fractional CFO (2–3 days per month). This is the stage where the ROI of CFO-level guidance typically exceeds the cost by 3–5x through margin improvement, tax savings, and cash flow optimization.
• $5M–$15M revenue: Bookkeeper (or controller) plus fractional CFO (3–5 days per month). The fractional CFO may manage or oversee the bookkeeper at this stage.
• $15M+ revenue: Full-time CFO with a bookkeeper or controller reporting to them. The complexity and daily decision volume justify a dedicated executive.

What to Look for in a Fractional CFO for Trade Contractors

Not all fractional CFOs are created equal—and most have never worked with a trade contractor. The financial dynamics of a plumbing company are fundamentally different from a SaaS startup or a law firm. Look for someone who understands job costing, labor burden calculations, service agreement economics, the busy-but-broke cycle, and the specific tax strategies that apply to trade businesses (like S-Corp elections and contractor-specific deductions).

A bookkeeper records history. A CFO shapes the future. Most contractors between $3M and $8M are drowning in history with no one shaping what comes next.

The Bottom Line

You need a bookkeeper at every stage—that is non-negotiable. The question is what goes on top of it. For trade contractors doing $2M–$15M, a fractional CFO delivers the strategic guidance of a full-time executive at 20–30% of the cost. It is the highest-ROI financial investment most contractors in that range can make—and it is the one most of them have not made yet.