5 Reasons why you should consider outsourcing your bookkeeping.
For small businesses the smallest increase in profit margin can mean a lot. More and more small and medium size businesses are moving to outsourcing business functions that will help to streamline their business, reduce ongoing costs and let them spend more time running their business.
Below we have outlined 5 reasons why you should consider rethinking hiring an internal bookkeeper and outsource this role.
In the accounting world, like all businesses, there are busy times of the year and quieter times. End of financial year is by far busier than the middle of summer. Hiring an internal bookkeeper means you must pay their salary year-round regardless of the workload.
In contrast, hiring an external bookkeeper allows you to contract help when you need it more. Tax time you can have a whole team working on your books, but when you are closed for Christmas you can reduce your outgoings.
Getting the Right Candidate
Hiring the right person is hard enough but when you don’t know what you are looking for it can be near impossible. If you do not know what makes a good bookkeeper, you can’t hire the right employee for your business.
Outsourcing your bookkeeping lessens your contractual obligations to you an employee. While you will still have a contract with an external firm, you have the comfort of knowing that they are experts in their field.
The reason you are hiring a bookkeeper is so you don’t have to do it yourself, but you will still need to train them. Policies and procedures need to be established to ensure tasks are getting completed correctly and with in the designated time period.
A contracted bookkeeper will already know what they are doing. They will have policies and procedures that have been tried and tested to ensure ease and efficiency. They have worked with businesses like yours before, so they know how you operate.
Wages and Entitlements
If you do find the right person for the job, you must spend time and money to keep them. You must pay them their yearly wage; ensure they are getting entitlements and complete their employment documentation.
Wages can be the biggest expenditure for a business, so why add to it when you can reduce it? Outsourcing means that you do not have to pay annual, sick or cares leave, superannuation and leave loading. Reducing costs and increasing profit.
Trust and Compliance
Can you trust someone with your lively hood? That is what you are doing when you onboard a bookkeeper. Like hiring the right candidate, you need to hire someone you can trust with not only sensitive information, but trust they are keeping your business compliant with tax and industry legislation. When hiring someone internally if mistakes are made the onus falls on the director/CEO, when hiring externally the onus falls on the bookkeeper.
Would a bookkeeping company hire someone who is known to be untrustworthy with money and does not understand tax compliance? No. Outsourcing ensures that you are keeping your businesses revenue safe and compliant.