The road from launch to sustainable growth is a critical phase of any small business that can only be successful when the ongoing investment of time and resources continues to produce increasing returns. When existing resources begin to produce diminishing returns, business growth can be stifled. At the point the business owner or his key people find themselves spending more time working in the business than working on the business, the business needs to evaluate its capacity to perform all of its functions to determine the best use of its time and money. This is the time when outsourcing may be the answer.
Technology has made it possible for small businesses to use 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 doesn’t include benefits and other employee costs. The time spent for outsourced functions can be more precisely allocated, which offers a more efficient use of resources.
Hire a Virtual Assistant
Routine functions, such as bookkeeping and payroll, are typically the first to be outsourced by small businesses. Depending on the size of the organization 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 major bookkeeping software programs, which can be linked for data sharing. A good virtual assistant can help you properly structure your system and increase the overall efficiency of managing your data and records.
When selecting a virtual assistant, check for pertinent certification and education. Find out how many clients the assistant has and whether they have experience with your particular type of business. It is important to check references and interview a few existing clients.
Use 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 are able to provide additional layers of accounting functions that can accommodate a growing business’s expanding needs. Beyond general journal and ledger bookkeeping, online services can provide accounting reconciliation, inventory reconciliation, payroll processing, cash flow management, monthly statement preparation, budgeting and taxation services. Additionally, they are best positioned to provide assistance with establishing or recommending accounting procedures. These services are usually well-staffed with experts who routinely work with accountants in preparing 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 bill hourly, while others offer service on a pay-for-performance basis.
It is important to know as much as possible about your provider's qualifications, capabilities and compatibility with you and your business. Stopping and starting new relationships with bookkeeping services can be costly in terms of down time, so the more thorough you are in the selection process, the better chance you have of finding the right long-term partner for your business.
Successful business owners earn their reputation through their ability to make the right moves at the right time by weighing costs and opportunities in every business decision. Large corporations have proven that outsourcing can have immediate positive results on the bottom line. Small businesses can stand to reap much larger gains in a shorter time frame when they employ outsourcing as part of their growth strategy.