As a business owner, it is natural for you to want to maximize business profits and have that extra cash on hand after all the bills have been paid. For this to happen, you need to make smart financial decisions on whether to cut costs or increase margins to maximize profits while maintaining quality service and products for your clients and customers.
You may feel that availing cheaper services for your business to cut on costs is one way to go. One of the things that some businesses, especially the small ones, have a hard time justifying is accounting and bookkeeping costs. If you feel this way, you may be tempted to get services from cheaper bookkeeping providers. However, you must keep in mind that cheap does not always equate to good value. Seasoned bookkeepers who offer excellent work price their services fairly. Here’s why.
1. Valuable Bookkeepers Provide Excellent Services
Your bookkeeper organizes and keeps track of the expenses and cash flow of your business. One of their most important tasks is ensuring that every transaction is accounted for and every expense is directed to the correct account. They also prepare the financial statement for you to make sure you are well informed. A trained bookkeeper does all of these error-free. They know that even the slightest error in the data means extra cost for the business, so everything is meticulously recorded and computed the first time.
2. They Understand Your Business
One difference between a valuable bookkeeper and a cheap one is their ability to understand your business. A seasoned bookkeeper usually inquires about your needs, about the ins and outs of your finances, and the standards of the industry where your business belongs. They can help guide you through your financial information so you can reflect and improve the way you run your business.
A cheap bookkeeping service, on the other hand, may only provide you with the minimum requirement for your business.
3. Seasoned Bookkeepers are Reliable
Most experienced bookkeepers does not offer their services cheaply. These bookkeepers know that they can communicate well and can respond to your vital questions appropriately. They are very knowledgeable when it comes to organizing your data, filing your taxes, and making sure everything that can be legally deducted from taxes are accounted for. Most of these bookkeepers are also registered BAS agents so they can help you lodge your BAS and settle any obligations you have with the ATO.
With a cheap bookkeeping provider, you may not enjoy all of these benefits. You may need to hire a registered agent to help you with BAS lodgements. Instead of saving money, you end up spending more.
Since bookkeepers oversee the financial flow of your business, you need to choose your bookkeeper well. Don’t let the price of the service be the only basis for choosing your bookkeeping provider. It is best to understand first the kind of service offered so you can make sure you are getting value for what you are paying for. It is worth getting a quality bookkeeper. It is one area in your business that you don’t want to cost cut on. That does not mean that you can’t reduce your bookkeeping costs. Here are some tips on what you can do to minimize bookkeeping charges and enhance your profitability.
3 Ways to Reduce Bookkeeping Costs
1. Organize your Finances
Staying organized is one key to financial success. Make sure you keep track of your receipts and hand them to your bookkeeper for filing. This will surely help make your bookkeeper’s job, including the generation of financial reports, faster and easier. If you’re paying your bookkeeper an hourly rate, having an organized file of transaction documents may get you lesser charges for bookkeeping services.
2. Go Paperless as Much as Possible
Aside from being environment friendly, going paperless on keeping your books and financial reports can save you on paper costs. This would mean, of course, that you’d have to keep digital files of your data.
You can do this at low cost by using a Cloud accounting software. With Cloud, your data are secured, but you and your bookkeeper can easily access them in real time. Cloud accounting software also allows for automation in organizing your documents. For instance, a cloud based accounting system can pull in the transactions that move through your bank accounts and credit cards. You can then create categories that automatically file recurring transactions.
A good Cloud accounting program saves you money and time because you won’t have to pay for the hours of manpower spent for manual data entry. Though you may need to pay for the Cloud accounting software, this amount is minimal compared to the amount you need to pay and the time you’d have to spend on organizing documents and calculating financial reports manually.
Outsourcing takes place when you contract an outside provider to conduct your business’ internal activities. When you outsource a bookkeeping service, you reduce your operation costs and capital investments. In hiring a full-time bookkeeper, you need to pay the wages, benefits and PTO. On top of that, you’d need to provide a computer and other equipment, office space and utilities, and if you need them past working hours, you’d have to pay an overtime fee.
In partnering with a bookkeeping provider, you won’t have to spend on all of these fully loaded costs of bringing on another employee and you won’t have to worry about another employee training. You also get access to more affordable technology, skills and expertise, and your business gets improved credibility and image through association with expert providers. With an outsourced bookkeeper, you are sure to get a good value out of your money.
How ACT Bookkeeping Group Can Help You
Does your business already have a good bookkeeping system in place? If not, we can help you manage your books so you can boost your financial strategy. You can outsource a variety of bookkeeping services from ACT Bookkeeping Group. Our team of experts can help you with the following services:
1. Accounts Payable and Receivable
2. BAS Lodgements
3. Monthly Reconciliations
4. Payroll Processing
5. Rescue Bookkeeping
6. Tax Calculations and Filing
We are here to assist you with your bookkeeping needs. We specialize in small business bookkeeping. Call us today for a free consultation.