As a small business owner, you have a direct hand in every aspect of your business. You’ve imprinted your vision on the entire company, and your hard work shines through every success. As your company grows, however, you may have to give up some responsibilities so that you can focus on what matters most.
Small business owners typically become entrepreneurs because they’re visionaries with dreams about how to help people, make the world a better place, and create a stronger future for their families. If keeping your books pales in comparison to these dreams, outsourcing your bookkeeping duties may be the right choice for you.
When you outsource your bookkeeping, you not only free up the time you need to focus on your company’s growth, but you also give yourself the necessary financial information to make smart business decisions. Take a look at several of the reasons that you might want to consider outsourcing your bookkeeping.
1. Outsource Your Bookkeeping to Stay Focused
Your vision and effort are necessary to grow your small business, but time spent keeping your books in order may be far less valuable, or even detrimental, to your company’s growth. Shifting from one task to another can actually result in a 40% drop in productivity.
Remember, there are many people who can handle payments and invoices and who can crunch numbers for you. But only you can be the visionary your company needs. Outsourcing your bookkeeping frees up time for you to do just that.
2. Outsource Your Bookkeeping to Make Scalability Easy
As your company grows, needed bookkeeping services are likely to increase. If you keep your bookkeeping in-house, you and your staff may not have the skills and experience needed to handle everything necessary. If you outsource instead, however, you will have instant access to the full suite of services you need. Then, scaling becomes a matter of making a phone call, rather than of gearing up for a new training initiative.
3. Outsource Your Bookkeeping to Have Timely Financial Data
The more accurate and up-to-date your financial data, the more you’re able to make smart decisions. Understanding your cash flow, in particular, can keep you from making the type of mistakes that can derail not only your company’s growth but also its survival. According to a study from the Geneva Business Bank, businesses that plan cash flow monthly have an 80% survival rate. Contrast that to businesses that only plan cash flow annually — these companies show a five-year survival rate of only 36%.
When you’re making development and marketing decisions about your company’s future, you need access to this essential financial information — but you’re less likely to have the time to crunch those numbers. Outsourcing your bookkeeping gives you the data you need to make decisions and to take the steps that lead your company to growth.
4. Outsourcing Your Bookkeeping Keeps Investors and the IRS Happy
Every party who has an interest in your small business financials — the IRS, your investors, or even your bank, should you seek a small business loan — feels more confident when you have professional accountants handle your bookkeeping. They can feel satisfied that your financial information is being dealt with according to Generally Accepted Accounting Principles, making it more likely that your numbers are accurate and reliable.
Outsourcing bookkeeping to a full-time accounting professional can also minimize the chances of mistakes that lead to audits or fines from your taxing authorities. Small businesses are hit with billions in fines from the IRS each year as a result of improper filings and omissions. When you outsource your bookkeeping, you release this area of potential worry from your slate, so that you can get back to what you do best.
5. Outsourcing Your Bookkeeping Can Increase Profits
When you outsource your financial prep, you open the door to a new channel of advice that can help you make smart financial decisions for your business. A full 33% of companies can point to tech recommendations they’ve received from their accountants that have resulted in increased profits and revenue. You’re also likely to gain from financial insights provided by your outsourced accounting partners.
Wrapping It Up
When you outsource the bookkeeping tasks of your small business, you get the accuracy and expertise you need without the time-consuming process of hiring new staff to handle this work. By removing these tasks from your plate, you can provide yourself with the space that you need to stay focused on the core of your business and to grow your business.