Benefits of Bookkeeping Outsourcing for Small Businesses
What Is Bookkeeping Outsourcing?
To understand the benefits of outsourcing bookkeeping
functions, one must first know what it means to outsource.
According to Merriam-Webster, to outsource is “to procure
(usually goods and/or services) under contract with an
outside supplier”. Businesses of all sizes outsource their
accounting for a variety of reasons. Perhaps there are not
enough resources within the business to complete the
function in house, or perhaps it is more cost effective to
contract out the bookkeeping work than to provide a full-
time bookkeeper with a salary and benefits. Sometimes, companies decide to outsource the
bookkeeping work, because frees up internal resources for focusing on tasks more related to the
business’s main purpose.
What Should Be Kept In Mind When Considering Outsourcing?
When a business owner is considering contracting out the bookkeeping work, there are some key things
he/she should keep in mind. The benefits of outsourcing the bookkeeping functions should be
considered- it is cost effective, frees up resources, and saves time- against those of an in-house
bookkeeper. In addition, the type of bookkeeping services needed deserves some attention, as well. If a
business pays special attention to a specific industry, a bookkeeper with experience in that same
industry should be chosen. Whether a smaller, more personal firm, or a larger firm will better be able to
handle the business’s books should also get some consideration. All of these factors should be heavily
weighed to determine if bookkeeping outsourcing, and its many benefits, is right for a particular small
business and its needs.
What are the Benefits of Outsourcing Accounting Functions?
The benefits of outsourcing can be numerous, especially for many small businesses. Outsourcing
accounting functions can be cost effective in a number of ways. Bookkeeping outsourcing allows
business owners to save on the costs of hiring a full-time employee to do the same work. Money is not
simply saved when it comes to salary, either. When a business owner chooses to outsource the
bookkeeping, he or she will face a reduction in employer payroll taxes, will not have to pay for another
employee to train the new employee, and will not have to fund workers compensation insurance, health
insurance, retirement plans, or paid sick/vacation days for a full-time employee to do the work. Another
way that bookkeeping outsourcing can be cost effective is that it puts the bookkeeping into the hands of
experts, who are less likely to make costly mistakes.
Another benefit that can go along with choosing to contract out the bookkeeping functions of a business
is that many bookkeeping outsourcing companies allow business owners to access their key financial
information 24/7, and to speak with experts whenever necessary during the day. In addition,
outsourcing the accounting can free up physical space and equipment for a small business, which can
allow for it to be more productive with its other functions.
The benefits of outsourcing are plentiful for small businesses. Time, money, and other resources that
would typically be put towards this function can be put towards other projects within the business for
higher revenues. It is well worth taking the time and doing the research to find out what bookkeeping
outsourcing can do for your specific business and needs.