As a business owner, the decision of how to handle bookkeeping can have a major impact on your time and your bottom line. There are multiple ways to handle the bookkeeping needs of your business such as doing them yourself, hiring an in-house bookkeeper, or outsourcing your bookkeeping needs. If you are trying to determine how to handle your bookkeeping needs, there are some things to consider that can aide in your decision making.
Consider the size of your business
The size of your business is the first factor to consider when determining if outsourced bookkeeping fits your business model. If you are just starting out as a sole proprietor, you may be able to handle your own bookkeeping needs. It is not uncommon for a sole proprietor to do everything related to the business in the beginning. If the bookkeeping duties are relatively simple and do not take away too much time from growing the business, then it may not make sense to spend the money on outsourced bookkeeping.
The bookkeeping demands are likely to increase if you own a small business that is growing quickly. Adding employees, expanding your customer base and offering more products or services are all good signs of a growing business but can make bookkeeping more complicated. In addition to becoming more complicated as the business grows, your bookkeeping duties will also require more time simply because there is more information to include. If the bookkeeping responsibilities are getting in the way of your ability to work on your business, it may be time to look into outsourced bookkeeping.
If you are the owner of a large business, you may be trying to decide between hiring an in-house bookkeeper and using outsourced bookkeeping. There is a convenience factor to having an in-house bookkeeper or accounting department. You will have a person or group of people focused solely on the bookkeeping needs of your business. In addition, you will have easy access to those people whenever you have a question or need help on an issue. While convenience and focus are important factors, hiring an in-house bookkeeper comes with its own set of possible issues. Do you have enough work to keep a bookkeeper busy on a full-time basis? What is the total cost of hiring a new employee, including salary and benefits? You could end up paying too much for bookkeeping services if you do not have enough bookkeeping duties to keep a full-time employee busy. If you decide to outsource your bookkeeping, you will pay only for the amount of work that you actually need completed, which could save you money.
Consider your goals and vision for the business
The goals you have for your business can aid in determining if outsourced bookkeeping fits your business model. For example, if you currently own a restaurant do you eventually want to expand to owning three restaurants or a whole chain of restaurants? If rapid growth is part of your plan, then you may not want to spend the time necessary to do your own bookkeeping and you may need to consider hiring help. The cost to pay an in-house bookkeeper could get in the way of putting money back into the business, especially if your company is still a small business. Outsourced bookkeeping, such as a virtual accounting firm, is a good option in this type of situation. As your business continues to grow, there may come a point when you require and can afford an in-house bookkeeper or accounting department. It is important to keep the goals of your company in mind and periodically reassess your bookkeeping needs.