How to Hire the Best CFO for Your Fire Protection and Restoration Services Business

The (Complicated) Role of Finance in Fire Protection and Restoration Businesses

Fire protection and restoration services companies have a distinct financial challenge. A CFO in this industry needs to navigate insurance claim processing, manage cash flow during emergency response periods, oversee equipment depreciation and fleet management, and ensure compliance with industry-specific regulations. As the Insurance Information Institute notes, property damage claims often involve complex negotiations and extended payment cycles. They must also understand the cyclical nature of the business, where natural disasters and seasonal patterns can dramatically impact revenue streams.

The right CFO will bring expertise in managing working capital during periods when insurance payments may lag 60-90 days behind service delivery. They’ll understand how to structure financing for expensive equipment purchases, from thermal imaging cameras to specialized cleaning machinery, while maintaining healthy profit margins.

Key Qualifications to Look for in a CFO Candidate

When evaluating CFO candidates for your fire protection or restoration business, prioritize these essential qualifications:

Industry Experience

While not mandatory, candidates with experience in restoration, construction, or insurance-related services will understand your business model more quickly. They’ll be familiar with percentage-of-completion accounting, insurance carrier relationships, and the importance of maintaining strong cash reserves for emergency response capabilities.

Technical Expertise

Your ideal CFO should demonstrate proficiency in financial planning and analysis, cost accounting for project-based work, insurance billing and collections management, and experience with industry-specific software platforms. The American Institute of CPAs (AICPA) emphasizes the importance of understanding specialized industry accounting practices. They should also understand equipment financing options and depreciation strategies unique to your capital-intensive industry, such as those outlined in IRS Publication 946 on depreciation.

Strategic Vision

Look for candidates who can articulate how they’ve helped previous companies scale operations, improve profit margins, and navigate economic downturns. The ability to develop financial strategies that support both organic growth and potential acquisitions is crucial in this consolidating industry.

Regulatory Knowledge

Ensure candidates understand OSHA compliance costs, EPA environmental regulations affecting cleanup operations, state licensing requirements, and insurance bonding requirements. The Small Business Administration (SBA) provides guidance on bonding requirements for service contractors. This knowledge helps prevent costly compliance failures and ensures accurate financial planning.

Determining Your CFO Needs: Full-Time, Part-Time, or Fractional

The size and complexity of your operation will determine whether you need a full-time, part-time, or fractional CFO. For a detailed comparison, see our article on fractional CFOs for Private Equity-backed companies. Here’s a short summary:

Full-Time CFO: If your company generates over $10 million in annual revenue, manages multiple locations, or plans aggressive expansion, a full-time CFO is likely necessary. They’ll provide dedicated leadership for your finance team and serve as a strategic partner to the CEO.

Part-Time CFO: Companies between $5-10 million in revenue often benefit from a part-time CFO working 2-3 days per week. This arrangement provides professional financial leadership while managing costs during growth phases.

Fractional CFO: Smaller operations or those seeking specialized expertise for specific projects (like preparing for acquisition or implementing new systems) may find fractional CFO services most cost-effective. These professionals typically work on retainer, providing 20-40 hours monthly.

The Hiring Process: Best Practices for Fire Services CFO

At ECA Partners, we have a data-driven, disciplined search process that results in some of the fastest CFO placements in the industry, making us a top 5 CFO search firm. If you’re thinking of hiring a CFO for your fire services or fire protection business, here is a guide to best hiring practices:

1. Precise Position Scoping

• Clearly define the strategic priorities for the first 12-24 months
  • Municipal contract renewals and optimization
  • Equipment modernization and fleet expansion planning
  • Regulatory compliance enhancement and risk mitigation
  • Emergency response cost recovery system implementation

• Articulate the CFO’s role in your value creation plan
  • Revenue diversification through expanded service offerings
  • Operational efficiency improvements across service territories
  • Technology integration for better resource allocation
  • Insurance claim optimization and loss prevention strategies

• Specify reporting relationships and expected interactions with the board
  • Direct reporting to the CEO with regular board presentations
  • Collaboration with fire chiefs and operational leadership
  • Interface with municipal officials and insurance partners
  • Coordination with regulatory agencies and compliance bodies

• Detail the current state of the financial function and required improvements
  • Assessment of existing accounting systems and processes
  • Evaluation of equipment lifecycle tracking and budgeting
  • Review of grant management and compliance procedures
  • Analysis of cost allocation methods across service areas

2. Targeted Recruiting Strategy

• Consider candidates from adjacent emergency services industries
  • EMS and ambulance services
  • Security and protective services
  • Municipal utilities and public works
  • Emergency management and disaster response

• Look for professionals with government contracting experience
  • Municipal finance background
  • Public-private partnership expertise
  • Grant administration and compliance experience
  • Experience with government accounting standards (GASB)

• Leverage industry-specific executive recruiters with fire services sector knowledge
  • Recruiters specializing in emergency services
  • Firms with municipal and public safety expertise
  • Executive search consultants with fire protection industry networks

• Evaluate candidates from larger fire services companies who seek more strategic influence
  • Regional fire protection companies
  • Multi-state emergency services providers
  • Corporate fire safety and prevention services

• Consider divisional finance leaders from major service companies ready for a CFO role
  • Finance directors from large municipal fire departments
  • Controllers from emergency services corporations
  • Financial managers from insurance companies (fire/casualty divisions)

3. Comprehensive Assessment Process

• Case studies simulating actual fire services’ financial challenges
  • Equipment financing scenarios for apparatus purchases
  • Municipal contract negotiation and pricing strategies
  • Insurance claim processing and recovery optimization
  • Emergency response cost allocation and billing

• Board presentation exercises demonstrating communication skills
  • Budget presentation to municipal councils
  • Financial performance reporting to the fire commissioners
  • Grant funding proposals and compliance reporting
  • Cost-benefit analysis for service expansion

• Operational leader interviews to evaluate cross-functional collaboration
  • Fire chiefs and deputy chiefs
  • Operations managers and shift supervisors
  • Training and safety officers
  • Equipment and maintenance managers

• Assessment of cultural fit with public service and emergency response environments
  • Understanding of 24/7 operational demands
  • Appreciation for life-safety mission and community service
  • Ability to work under pressure during emergency situations
  • Respect for fire service traditions and hierarchy

Conclusion

Hiring the right CFO for your fire protection and restoration services business requires understanding both the unique financial challenges of your industry and the strategic value a skilled financial leader brings. The National Association of Corporate Directors (NACD) emphasizes that financial leadership is crucial for companies navigating complex regulatory and operational environments. By clearly defining your needs, implementing a thorough recruitment process, and providing comprehensive onboarding, you’ll position your company for sustainable growth and financial success. Remember that the right CFO is not just a numbers person but a strategic partner who understands the critical role your services play in helping communities recover from disasters while building a profitable, sustainable business.

The investment in finding the right financial leader will pay dividends through improved cash flow management, stronger insurance carrier relationships, and the financial infrastructure needed to scale your operations effectively. Take the time to find a CFO who not only understands debits and credits but also appreciates the mission-critical nature of your services and the unique financial ecosystem in which you operate.

Steven Haug is a Managing Partner at ECA Partners. He can be reached at [email protected].

Tony Topoleski is a Senior Director at ECA Partners. He can be reached at [email protected].