There are naturally going to be pro’s and cons associated with outsourcing any of your company’s bookkeeping and accounting, or both, and it’s important to weight them up rationally before making any decisions. Here are a few suggestions of what to look out for and avoid, when outsourcing:
Beware of inefficiency:
Nobody is going to tell you that just because you’ve outsourced your bookkeeping duties, that that provider will produce their bills on time, establish solid working processes and optimize efficient systems for billing, payments or collections. As with outsourcing any element of your business, it comes with its risks, but the sooner you can spot any of these concerns and prevent them from having a negative impact on your business, the better.
Look out for hidden costs:
It’s widely acknowledged that many outsourced services advertise their prices at ridiculously low levels, and then make up the shortfall by charging businesses for additional fees and hidden costs. If something seems too good to be true, the chances are that it is, so be certain to talk through their pricing in detail before you commit to anything; unwanted or unexpected bills can seriously harm your business.
You should also always be wary of services offering fixed, all-or-nothing plans, since most companies of good repute will offer customizable packages to suit their clients. Keep in mind that a truly professional bookkeeping or accounting provider will always disclose the costs of their services and will never try to hide additional fees, they should also offer a variety of pricing plans and subscription options.
Does your provider communicate well with you?
Consistency is vital for any business owner when faced with bookkeeping or accounting duties, and if one bookkeeper is on leave, those duties should be taken over by someone else to avoid mistakes or discrepancies further down the line. If you are not enjoying a consistent service from your provider, then alarm bells may start ringing.
Some outsourcing companies are located overseas, where communication issues may easily arise due to cultural differences or time zones. If you’re not able to speak with your provider when you need to, or cannot understand them when you do get through, then they may not be as professional as they may appear.
Take confidentiality and/or security very seriously:
If at any point you suspect that the security or confidentiality of your business maybe threatened due to a poor accounting or bookkeeping provider, then you should act fast and look to tackle these issues head on. When you outsource bookkeeping or accounting, you are giving that provider access to lots of personal and confidential information pertaining to your clients, your employees and your client’s businesses, and any oversight in these areas can have very serious consequences for you and your business.
There can be little doubt that outsourcing works tremendously well for thousands of small businesses the world over, but make one poor judgement too many, and it could spell the end of your business. Research your provider, get reviews form others and always ask questions about the service they are giving you. Be savvy, and you could soon be well on the way to success and could even turn your small business, into a medium or large one!