|Rich Best has spent 28 years in the financial services industry, as an advisor, a managing partner, directors of training and marketing, and now as a consultant to the industry. Rich has written extensively on a broad range of personal finance topics and is published on several top financial sites. Recent books include The American Family Survival Bible and Annuity Facts Revealed: What You MUST Know Before You Invest.|
Achieving Business Gains Through Outsourcing
The road from business launch to sustainable growth is a critical phase of the business that can only be successful when the ongoing investment of time and resources continues to increase returns. When existing resources begin to produce diminishing returns, business growth will be stifled. When the business owner or his key people find themselves spending more time working in the business rather than working on the business, the business needs to evaluate its capacity to perform all of its functions in light of the best use of its time and money. That is the time when outsourcing may be the answer.
Technology has made it possible for small businesses to utilize outsourcing, even in the early stages of the business growth cycle. It may cost more on an hourly basis to outsource a function, but the cost is strictly for the time spent and does not include benefits and other employee costs. The time spent on outsourced functions can be more precisely allocated, which can be a more efficient use of resources.
Hiring a Virtual Assistant
Routine functions such as bookkeeping and payroll are typically the first to be outsourced by small businesses. Depending on the size and the amount of activity generated by the business, these functions may require as little as 30 hours per month. Technology enables these functions to be virtually performed by specialists from their place of work. Virtual assistants are among the fastest-growing segments of business outsourcing. Most virtual assistants are proficient with the top bookkeeping software programs, which can be linked to data sharing. A good virtual assistant can assist with the proper structuring of your system and help you increase the overall efficiency of managing your data and records.
When selecting a virtual assistant, you should check for pertinent certification and education. You will want to know how many clients they have and whether they have experience with your particular type of business. It would be important to check references and interview a few existing clients.
Online Bookkeeping and Accounting Services
The difference between a virtual bookkeeper and online bookkeeping and accounting services is the level of service and technology that can be delivered. Using sophisticated data encryption and communications technology, source documents, and data can be uploaded and stored on web-based applications, which allows for remote access. All entries can be recorded and accessed from any remote location.
Online bookkeeping services can provide additional layers of accounting functions that can accommodate a growing business’s expanding needs. Beyond general journal and ledger bookkeeping, they can also provide services in accounting reconciliation, inventory reconciliation, payroll processing, cash flow management, monthly statement preparation, budgeting, and taxation services. Additionally, they are best positioned to assist with establishing or recommending accounting procedures. They are usually well-staffed with experts who routinely work with accountants in the preparation of year-end financial documents and tax filing.
Their services are usually billed on a fixed monthly rate, which can be advantageous from a budget planning standpoint. Some will bill hourly, and there are also services available on a pay-for-performance basis.
It is essential to know as much as possible about your provider in terms of their qualifications, capabilities, and compatibility with you and your business. Stopping and starting new relationships with bookkeeping services can be costly in terms of downtime. Hence, the more thorough you are in the selection process, the better chance of finding the right long-term partner for your business.
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