Common Mistakes While Outsourcing Bookkeeping Services
Outsourcing the books saves you money and time. But that doesn’t mean you should opt for it as soon as you find a random bookkeeping firm. You won’t be able to make the most of outsourcing unless you have a plan. Moreover, it is important to define your expectations and objectives from outsourcing services.
Otherwise, outsourced bookkeeping services might not turn out to be that great for your business.
Here we have compiled a list of expensive outsourcing accounting mistakes and how you can avoid them.
Not Defining Your Goals:
Sure, outsourcing your bookkeeping can ensure you low rates and minimum management. But you shouldn’t be carried away by these benefits only. You might not make the most of your bookkeeping outsourcing unless you have a plan in place.
Therefore, make sure to define your objective gained from outsourcing services.
- Why do you need to outsource your bookkeeping?
- How much time and money can outsourcing save you?
- Is it better to hire an in-house resource instead?
Not Interviewing:
Will you hire somebody in your company without interviewing in the first place? Of course not, then how can you think of hiring anyone randomly without asking the important questions?
While you can go through some online feedback or referrals from your peers or friends, interviewing with your prospect bookkeeper is important.
You must be wondering how to interview your potential outsourcing company that is located in the next city, if not located thousands of miles away from you. Technology has got you covered. It is possible to ask your outsourcing company important questions over video calling apps like Skype.
Or the simplest way is to send them an email covering your questions.
Hiring the Cheapest Service Providers:
While looking for an affordable bookkeeping outsourcing company can be your priority, quality comes first. Maybe you find the most affordable vendor only to find later that they are cutting a corner. As a result, you get poor quality of service.
But that doesn’t mean expensive ones ensure the best bookkeeping services. Like we have said before, quality should be your priority. You can call them and read their reviews. Generally, an efficient bookkeeping company can charge you a bit more. It is totally worth it as they saving you hassles and the cost of hiring a bookkeeper down the road.
Not Defining Your Expectations at the Beginning:
Make sure to be clear about your expectations while signing up for bookkeeping services. Otherwise, you might miss out on your outsourcing goals.
Here are some points to define your expectations.
- Accounting work to be delivered daily, weekly, or biweekly.
- Mode of communication
- Method of issue resolution, especially in an emergency
Not Having Proper Communication:
With outsourcing, you don’t have to micro-manage every aspect of work as the outsourced company’s manager will do it for you. But this doesn’t mean you completely rely on them and ignore communicating with them. If you don’t follow up, then this could lead to a huge mistake on your part.
The outsourced accounting team might be efficient and experienced, but if you don’t the work done the way you want, then you have to communicate with the remote team and guide them when they are not doing it according to your style.
Regular communication is important for a business organization whether things are managed in-house or remotely.
Not Understanding the Bookkeeping Services You Need:
If you don’t determine the scope of what you require accurately, most probably, you will get inappropriate solutions. Make sure that you have outsourced a complete process. For example, you might feel that you just require invoice scanning and data entry with software for accounts payable management. But it is important to ponder over how the time will be sent throughout the process.
Moreover, most businesses find the biggest concern coming from a total outsourced account payable management solution that includes automating routing for vendor setup, approval, exception management, and support for vendor payments as well.
Complete accounts receivable management solutions will include customer billing, cash application exceptions, and customer late payment reminders. You should personalize an integrated end-to-end accounting process to your requirements based on your business guidelines for a successful outsourcing accounting solution.
Starting By Outsourcing the Most Challenging Tasks:
Most businesses are likely to outsource the most difficult bookkeeping tasks. However, instead, try to outsource your process-driven standardized, and time-consuming tasks first to liberate the most value. It will help you achieve some quick wins before building complexity.
Not Standardizing the Workflows:
When tasks are assigned in an ad hoc style, your remote bookkeeper won’t be able to know how to meet your expectations. And if 10 partners have 10 different ways of doing the same task, you will only increase confusion.
Therefore, it is important to standardize workflows.
Creating a common structure lays down “train tracks” for those remote bookkeepers to follow. Moreover, it provides a framework for continuous improvement.
