The Top 4 Reasons Why You Should Outsource Your Bookkeeping
Over the last 15 years I’ve worked with hundreds of businesses and it’s never ceased to amaze me how many business owners complete their own bookkeeping.
It’s often the job given to the significant other who takes it on reluctantly to support their partner.
Often, they have little or no experience and they rarely have the time – in between supporting the business and dealing with the kids – to complete the processing.
This often leads to both husband and wife having to complete bookkeeping late at night or over the weekend just to keep up, causing stress and often leading to costly mistakes.
It doesn’t have to be this way!!!
Hiring a bookkeeper isn’t that expensive and guess what: they’re experts and can often do it much better and quicker than you can.
The Retail Business
I once worked with a lovely couple here on the Gold Coast.
He was a chemist, and because of the nature of his work he had to commute to Brisbane each day. He hated this daily three-hour commute with a passion and desperately wanted to find another way.
Then one day, driving home, a truck pulled across the front of his car nearly swiping him off the road. Shaking with shock he said:
“That’s it, I’ve had enough. No more commuting!”
The couple decided the only way they could earn money without needing to either commute or move to Brisbane was to start their own business.
But like most business owners, the business consumed them and all of their time.
When I came along they wanted to work on growing and developing their business, but they were drowning in paperwork.
They were trying to do their own bookkeeping at the same time as working in and running a busy retail store and bringing up a family.
Neither of them were experienced in bookkeeping or had the time needed to do it properly. It was in a mess.
- They had no idea who they owed money too.
- They didn’t know what their cash flow was like.
- They didn’t know what the payroll would be that week.
- They were missing deadlines.
- They were making countless and costly mistakes.
One of the first things we did was to outsource their bookkeeping.
We hired a experienced bookkeeper, set up and implemented a daily, weekly and monthly process, and allowed the expert to get on with it. The business owners immediately they got some of their time back.
As the owners said to me:
“This is the best thing we’ve ever done. We now have more time, and I feel so much more in control of my business.”
This wasn’t the first time I had heard this and it won’t be the last.
Maybe at the start it does make sense to struggle on and do your own bookkeeping, but as soon as you start getting money in the door it should be one of the first things you outsource.
Sometimes it’s not just the business you help, as this client told me:
“I think getting a bookkeeper might have saved our marriage!”
Top 4 Reasons to Outsource Your Bookkeeping
There are lots of reasons why you should outsource your bookkeeping, but here are the top 4 reasons why I think you should outsource yours.
You get your time back
How much is your time worth? What else could you be doing with your time instead of bookkeeping?
The Mortgage Broker
I worked with a mortgage broker once. As well as running her own business, she was spending hours each week doing her own bookkeeping.
We calculated that while she was working with clients she was earning around $500 per hour. A bookkeeper costs anything from $30 to $50 per hour. You don’t need to be Einstein to see that financially it just didn’t make any sense for her to do the bookkeeping herself.
By getting someone else to do it she could spend more time working with clients and earning more money.
The bookkeeper can get on with what they’re good at and the business owner can get on with what she’s good at.
It’s not always this easy to quantify it, but as a business owner you need to be working on the tasks that only you can do – not the tasks that you can hire someone else to do, who is more experienced and is available at a reasonable price.
Get Your Evenings and Weekends Back
And it might not just be more time to work on the business.
Often, business owners are spending their evenings and weekends doing their accounts. They miss out on family time and miss out on their kids growing up.
You just can’t put a value on that!
Remember, time is the most valuable asset you have.
We all have the same 1,440 minutes in a day. What determines your success is how you choose to spend that time. Don’t spend it on bookkeeping – there are experts out there who can do that for you.
You get to stay in control
One of the biggest challenges when you work for yourself is keeping up with everything!
It’s very easy to get overwhelmed and feel out of control!
You have to deal with:
- the demands of your customers,
- sorting out your suppliers,
- managing your team,
- working on marketing, and
- getting more business in the door.
There’s just so much to deal with. If you’re in business you don’t need me to tell you this. Dealing with your accounts is just another thing to get done.
Drowning in Paperwork
In fact, keeping up with paperwork is key to staying in control. Nothing will make you feel like you’re losing control more than drowning in paperwork.
It’s hard to know:
- who you owe money too,
- who owes you money, and
- how much you need to pay your team.
You just don’t know where you’re at and you’re constantly chasing your tail.
Costly mistakes are often made as things are missed. I’ve seen many clients who’ve done the following:
- Forget to invoice customers,
- Had customers who haven’t paid
- Paid suppliers twice,
- Overpaid team members
- Even had cash stolen
Business owners also struggle to keep up with the mountain of ever-changing compliance and have no idea if they’re doing things the right way, often submitting returns late or not at all.
All of this keeps them awake at night as they suddenly remember something else they haven’t done!
It doesn’t have to be this way. With a bookkeeper, they’ll be able to look after all of this for you.
They know how to do this effectively and efficiently, and they keep up with the ever-changing compliance it’s their business – in fact, they enjoy it.
And best of all you can feel more in control of your business and you can sleep better at night.
You Get help from an expert
When was the last time you fixed your own car?
- Did you change your brake pads the last time they’d worn out?
- Did you change the exhaust?
- What about the last service, did you do that too?
You could do it. I’m sure you could find instructions online on how to do it.
It might take you a while and you might make a few mistakes, but you’d get there in the end.
You might lose a weekend or two or need to take time away from your business. Yes, you wouldn’t be able to earn money while you were doing it, but at least you’d save the bill from the mechanics.
Most people don’t fix their own cars anymore. They get an expert to do it.
They outsource it to someone who has trained specifically to do it, has spent years fixing cars every day and who has all the tools they need set up in a purpose-built workshop.
By getting an expert to do it, business owners know they will:
- get it done quickly,
- do a much better job, and
- leave you to get you with your life.
Business owners can spend their time either working and earning more money or spending it with their families.
Bookkeepers are Experts
It makes sense for most people to do this. It’s the same in your business with your bookkeeping.
There are expert bookkeepers out there, who are
- Professionally trained
- Experts in accounting software
- Have been doing bookkeeping every day for years, and
- Best of all, they’re reasonably priced too.
You can leave it all to an expert and reduce any potential errors, saving you hours and hours of your time.
You can spend your time working on your business, earning more money, or spending time with your family.
You’re not a bookkeeper, so why spend your time bookkeeping? Leave it to the experts.
You Can Do Some Too
I’m not saying you should leave it all to an expert.
Every business is different, and there may be some day-to-day tasks that you’re best doing yourself.
With your car you don’t need an expert to:
- fill up your fuel,
- put air in your tyres, or
- top up your oil.
But it would be good to use a bookkeeper to support your business weekly, monthly or quarterly, and to have an expert on hand when you need them.
A bookkeeper can use their expertise to clean up your accounts and set up your processes to operate effectively.
Then they can give you the support and training you need to complete the day-to-day tasks coming in once a week, month or quarter to clean things up, reconcile your accounts and check everything is correct.
Your job is to run your business. Get help from the experts with your paperwork.
You get the right information to run your business
Numbers are the language of business. It’s vital that you have access to the right information and accurate numbers to run your business effectively:
- How are you supposed to know if all your customers have paid
- Or how do you avoid over paying suppliers
if you don’t have up-to-date and accurate account information? This is simple information that a good bookkeeper could easily provide.
Over the years I’ve seen horror story after horror story of business owners devising complex spreadsheets and piles of paperwork trying to keep track of who owes them what or how much they owe.
They spend hours and hours working it out and still make huge errors that cost them thousands of dollars. A good bookkeeper can provide all this information for you.
It doesn’t stop there. A good bookkeeper can also let you know how your business is performing.
They can tell you what sales you’ve achieved, how much profit you’ve made or how much cash you have in the bank.
They can guide you and support you to give you the financial information you need so that you can make better decisions in your business and improve your results.
Your next step should be to look into the possibility of a bookkeeper for your business.
A good bookkeeper will:
- free up your time,
- help you stay in control, and
- provide you with the information you need.
If you’d like some help finding a bookkeeper then give us a call 1300 300 746.