As a new business owner, you’ll often have to decide between hiring in-house staff or outsourcing to a third-party company. There are many instances where hiring new staff is beneficial. However, when it comes to accounting for a small business, outsourced accounting services are the ideal solution. Here are five advantages of outsourcing your accounting needs.
- A Cost-Effective Solution
As a business owner, you’re probably interested in reducing expenses and increasing your profit margin. Working with outsourced accounting services is one of the best ways to do this. In comparison, hiring an in-house accountant or financial team could cost you several times more than simply working with a third-party company.
“The first major problem with hiring part-time or full-time accountants is that you’ll be paying for wasted time,” says outsourced accounting leader, tempCFO. “Whether paying an hourly wage or a full-time salary, it’s not an efficient way to spend the funding.” But when you pay to outsource, you pay only for the work that is done. You aren’t paying for any time that wasn’t spent productively.
This isn’t always a fault with the accountant, but just that there is not enough work for most small businesses to keep them busy around the clock. If they aren’t busy around the clock but are getting paid around the clock, then your company is wasting money. Your business may reach a growth point in the future when it can justify the cost of an in-house accountant. For most smaller businesses it isn’t a good financial decision.
Not only are funds wasted on worker productivity, but also on benefits that are mandated by the government. Chances are, you’ll be paying for training, vacations, and leaves for the new accountant. These are all expenses that you don’t have to worry about when you choose to outsource to a third-party accounting firm.
Ultimately, by paying for outsourcing, you are keeping your expenses as low as possible. This means more money can be spent on the growth of the businesses, which is a smart move for any small business.
- Saving Time
If time is money, then saving time is as important as saving money. Using outsourced accounting services can help in both of these regards. There are multiple ways in which third-party accountants free up valuable time for you, your employees, and your business as a whole. When combined with the first advantage mentioned, saving money, the concept of saving time can boost business productivity and growth significantly.
Even if you are not the one doing the accounting, it still takes a lot of time to manage the services in-house. You have to worry about hiring, training, and managing new employees. Suddenly, you have a new demand on your time as a business owner. That’s time that you could be spending on more valuable pursuits. Especially if you are a small business just starting to grow.
Accounting firms have their own managers, trainers, and hiring staff. They worry about all of the excess details for you. All that you will have to worry about is providing them with the information they need and letting them do their job.
Providing the necessary financial information is no longer as time-consuming as it used to be. Most accounting firms will offer advanced software packages that automate most of the process. These programs greatly reduce the amount of time you or your employees need to spend logging in information and sending it to the firm. That brings up a third advantage.
- The Best Technology In The Business
When you hire a lawn care company to care for your property you expect them to have the best equipment possible. The same applies to outsourced accounting services. Accounting software can be extremely expensive. Most small companies simply cannot afford to invest in the best software. Even without considering the cost of hiring an accountant to use the software.
The leading accounting firms have already invested in the best possible software packages and tools. You have peace of mind knowing that your financial report is being handled by the best professionals in the industry who are using the best possible tools in the industry.
In many cases, your company will gain some access to these software tools. They may allow for the automation of data transfer or more accurate record collecting. In either scenario, you’ll get to enjoy some of the best software currently available without covering its full cost.
- Access to The Best CPAs
This goes along with the previous advantage. Not only do get to enjoy the benefit of the best technology in the field, but also the best workers in the field. Finding and employing well-qualified accountants can be extremely difficult. You might go through the hiring and firing process several times before you find a worker that fits well. But the outsourced accounting firm has already gone through that process. That means they already have the best CPAs in the industry.
Well, known accounting firms make an effort to find the best accountants there are. They know many of them by name and devote plenty of resources to bringing them over onto their team. And many of the best accountants actively look for work with leading accounting firms. All of this means that if you want the best possible accountants handling your books, taxes, records, and reports, then you should outsource to a well-known accounting firm.
- Records Are Easier to Monitor
Keeping your own employees on track can be a difficult task. If you only have one accountant in-house, it’s very easy to miss deadlines. Not only because of the accountant but because the company’s financial records may be a mess. But by outsourcing to an accounting firm you know that they have proper records on a daily basis and that they have multiple workers standing by to keep your projects on track.
As you can see, outsourcing is the best option for a small business. It will save time and money, it will provide you with access to the best technology and professionals, and it results in easier record keeping. That means you’ll have more time, money, and manpower to focus on growing your business.