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What Are the Benefits of Outsourcing Your Bookkeeping?

When I started my own business, I was excited about working on it. I quickly realized, however, that being my boss also meant that I had to be the one in charge of bookkeeping. I’d heard of other small businesses who outsourced their bookkeeping, so I decided to look into that option.

So, what are the benefits of outsourcing your bookkeeping? The main benefits are that it saves you time and money and allows you to focus on your core business. It also gives you peace of mind that a trained professional is making sure your business is financially compliant.

These benefits play out in several ways for both you and your business.

How Outsourcing Your Bookkeeping Benefits You and Your Business

Deciding to outsource your bookkeeping does have a price tag, but it usually brings far more benefits than costs. When you outsource your bookkeeping, it:

1. Saves You Time

The most obvious benefit of outsourcing is that it saves you time. Accounting takes time away from running and growing your business, and if you’re not an accounting expert, it can take even longer to learn all of the ins and outs of how to keep your books. You’ll have to spend time researching bookkeeping methods and software and keeping up with changes in tax laws, not to mention filling out all of the necessary paperwork and records.

Outsourcing your bookkeeping also saves you time by removing the need to hire an internal accountant, at least for a time. It takes money, time, and energy to recruit, hire, and train a new employee, and while this may be worth it for a well-established organization, it often isn’t a viable option for small business owners.

2. Saves You Money

If you aren’t an expert in accounting, you’re likely to make mistakes when you try to handle it yourself, and these mistakes can cost your business money in the form of late fees, penalties, and interest charges.

Outsourcing your bookkeeping to a professional can help you avoid these costly mistakes. In addition, many small businesses don’t have the budget to hire a full-time in-house accountant. When you outsource your bookkeeping, you can get the same level of expertise without the added cost of an employee’s salary and recruiting, hiring, and training costs.

3. Allows You to Focus on Your Core Business

Remember, bookkeeping takes time away from running and growing your business.

By outsourcing your bookkeeping, you can focus on the things that make your business unique. This is the time you can spend developing new products or services, expanding into new markets, or improving your customer service.

In other words, you can focus on the things that will make your business more successful rather than getting bogged down in the details of accounting.

4. Gives You Peace of Mind

Finally, outsourcing your bookkeeping can give you peace of mind. When you outsource your bookkeeping, you can be confident that a trained professional is taking care of your finances. This means you can rest assured that your business is compliant with all the necessary financial regulations, which can be a huge load off of a small business owner’s shoulders.

Outsourcing your bookkeeping is a smart move for any small business owner. It saves you time and money, allows you to focus on your core business, and gives you peace of mind.

Additional Benefits of Outsourcing Your Bookkeeping

Depending on the company you choose to handle your bookkeeping, you may have access to some additional benefits as well.

For example, some bookkeeping and accounting services offer payroll processing, which can save you even more time and hassle. Others offer financial analysis and reporting as well, which can give you valuable insights into your business’s financial health.

Some services also provide consultation services for when your company is going through a merger or acquisition, taking away much of the stress that comes with navigating those financial processes.

If you think you may want any of these services, pay attention when you’re looking for companies to outsource your bookkeeping to so you can make sure that the one you choose offers all of the services you’re looking for.

Choosing a Bookkeeping Service

Now that you know the benefits of outsourcing your bookkeeping, it’s time to choose a bookkeeping service. There are a significant number of organizations that offer this service, so it can be tricky to narrow your options down to just one company. Plus, you’ll want to make sure you find a trustworthy company that you feel comfortable trusting with your business’s finances.

To make sure you find the best fit for you, there are a few things you should keep in mind when making your decision:

  • Make sure the company is qualified and has experience handling the finances of businesses like yours. This will ensure they’re familiar with the financial regulations that apply to your industry and can help you avoid any costly mistakes. You should also check that they’re used to working with small businesses and have experience scaling.
  • Find out what kinds of services the company offers. As mentioned earlier, some bookkeeping services offer additional services like payroll processing and financial analysis. If you think you may want these services now or in the future, make sure the company you’re considering can provide them.
  • Compare pricing between different companies. Bookkeeping services typically charge either an hourly rate or a monthly fee, so make sure you understand how each company charges before making your decision. You should also ask for a breakdown of what services are included with the price they give you.
  • Get recommendations from other business owners. Ask other small business owners in your industry who they use for their bookkeeping and get their thoughts on the quality of service they’ve received. Having a word-of-mouth recommendation can go a long way in helping you narrow down your options and making you feel comfortable with your decision.

Once you’ve considered all of these factors, you’re ready to choose a bookkeeping service that you’re comfortable with and that will meet your business’s needs as it grows.

How to Tell It’s Time to Outsource Your Bookkeeping

Many small business owners can manage their bookkeeping just fine for a while, but they often come at a time when it’s necessary to have a professional take over. If you’re not sure whether or not you should outsource your bookkeeping, here are a few signs that it may be time to make the switch:

  • You’re spending too much time on bookkeeping tasks. If you find yourself spending more and more time on bookkeeping tasks, it may be time to outsource. This is especially true if you’re spending so much time on bookkeeping that it’s taking away from other important aspects of your business or completely removing the possibility of you having anything resembling a personal life.
  • Your accounting software is too complex. If your accounting software is starting to feel like it’s too much for you to handle, it may be time to outsource your bookkeeping. A professional bookkeeper will be able to use even the most complex accounting software to its full potential, so you can focus on running your business.
  • You’re making mistakes. If you’re making more and more bookkeeping mistakes or just aren’t confident in your abilities to do it accurately anymore, it may be time to outsource your bookkeeping. Not only will this save you time in the long run, but it can also help you avoid any costly mistakes that could hurt your business.
  • Your business is growing quickly. If your business is growing quickly, it may be time to outsource your bookkeeping. A professional bookkeeper can help you keep up with your finances and make sure your business is compliant as you grow so that you can focus on other aspects of running your company.
  • You’re ready to focus on other things. If you’ve been thinking about outsourcing your bookkeeping for a while but haven’t pulled the trigger, it may be time to finally make the switch. This will free up your time so you can focus on other aspects of your business like growing your customer base or developing new products and services.

Deciding to outsource your bookkeeping is a big step, but it can be a great way to save time and money. If you’re still not sure if outsourcing is right for you, talk to a professional bookkeeper or accountant to get their opinion.

When should I hire an in-house accountant?

There are several signs that it might be time to hire an in-house accountant, but many companies do this when they reach a certain size. If your company is growing quickly and you’re starting to feel like you can’t keep up with your finances even with outsourced bookkeeping, it’s probably time to hire an accountant.

What’s the difference between an accountant and a bookkeeper?

An accountant is a qualified professional who can perform a variety of financial tasks, including auditing, tax preparation, and financial consulting. A bookkeeper is someone who specializes in keeping track of a company’s financial transactions.

– the article sponsor is LUXA
Written By

Matt has over 10 years of legal writing experience. He's worked and written for legal websites for serval websites including Truskett Law, Bruner Law, Jeffrey & Erwin, Gary Crews, PLLC., Deposition Academy, and Wagner & Lynch.

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