So you started your technology company. Congratulations! But who’s taking care of your finances? Especially if you don’t have a financial background, managing the finances of your young company can quickly become overwhelming and take you away from the other duties that are essential to keeping a new startup afloat.
If this is the case, then you’ve reached the decision to outsource. If you’re still trying to decide, try taking a look at some of our other blogs. But after a google search or quick chat with some of your more knowledgeable friends, you’ve reached another decision point. Do you need a bookkeeper or accounting services?
Let’s explore that.
What Does a Bookkeeper Do?
A bookkeeper performs a wide range of basic accounting tasks. They typically use accounting software for financial transactions, recording cash, check, and vouchers, as well as accounting for debits or credits. They produce the reports needed to run a business, like balance sheets or income statements.
Some bookkeepers will handle an entire organizations books, while others will handle just specific tasks. Other responsibilities of bookkeepers include payroll, billing, purchasing, and keeping track of overdue bills.
Who Needs a Bookkeeper?
Most small businesses could benefit from a bookkeeper. Especially if you’re just starting or don’t have a financial background, a bookkeeper ensures that bills are paid on time, taxes are filed appropriately, and any red flags that may appear are noticed and taken care of quickly.
[STOP] Having trouble meeting franchisor requirements due to accounting or finance? -> Let's Talk
But, if your company grows to be too large or starts thinking about larger financial moves such as mergers and acquisitions, a bookkeeper is no longer right for you.
What are Outsourced Accounting Services?
Think of an accountant like a doctor and a bookkeeper like a nurse. Both have vital roles, but the nurse does the basic everyday tasks like inserting IVs, administering medication, and checking in on patients daily. A doctor might perform surgery, strategize a course of treatment or deal with complicated health issues.
When you pick outsourced accounting services, you’re getting services beyond those of just a bookkeeper. Now you’ll be receiving services like a virtual CFO. This means you’ll have someone with financial knowledge and experience to help you in merger negotiations. You’ll also have someone to help you understand your financial advantages and limitations when it comes to growing your business.
Who Needs Outsourced Accounting Services?
The short of it is that anyone can benefit from outsourced accounting services. If you don’t have a financial background, then it’s always helpful to have someone who can guide larger financial strategies that you just may not have the experience for.
As your franchise restaurant or technology start-up continues to grow, it becomes more and more likely that you’ll need outsourced accounting services versus just a bookkeeper. Larger businesses have more finances to juggle and more strategic decisions to make.
Think of a large company like Microsoft or Google. They have a huge financial team that takes care of all of their decisions. As a growing company, you don’t need a team quite that large. However, you’ll get to the point where you need something more than a single bookkeeper.
When to Choose One Over the Other
Deciding between outsourced accounting services and outsourced bookkeeping can be difficult. How do you correctly gauge where your company stands? Here are some things to keep in mind.
Length of Relationship
How fast is your company growing? If you’re growing quickly, then it doesn’t make sense to start off with a single bookkeeper for less than a year, only to have to switch over to outsourced accounting services later on. Then you find yourself having to move data and documents over to a new provider while teaching a new team about your company, your future goals, and your current needs.
For many companies, it may make more sense to start out with full outsourced accounting services even if you aren’t 100% sure you need it quite yet. Given a longer relationship, they’ll be more familiar with your company and better able to guide your finances toward your long-term goals.
Take a long hard look at what the next five years look like for your company. Where do you see yourself? Your client-base? How many office locations will you have? Number of employees?
On the other hand, you don’t want to have to transition your finances over to a different company just before a big decision. Your company could be stuck halfway between the process and have to decide whether or not to buy another start-up. You don’t want to have a CFO who is just getting familiar with your company when you’re looking for negotiation advice.
If you have big plans in the future, then it’s time for a bigger team. Outsourced accounting services can get your finances started off on the right foot so that you can reach those five-year goals.
What does your budget look like? Can you only afford a bookkeeper? Hiring a single bookkeeper may be cheaper than hiring an entire outsourced accounting team (although surprisingly, it’s not always). But, with just a bookkeeper, you won’t be receiving the more advanced amenities that outsourced accounting services would be able to provide you with.
If you have a larger budget and are on the fence with your decision, it’s almost certainly a better idea to choose a customizable outsourced accounting package. It may not have all of the advanced amenities, but you’ll be receiving more for your money than you would with just a single accountant – and, when growth happens, you’ll have an easy means of scaling your accounting with it.
[STOP] Not sure who you can trust your franchise accounting and finances to? See why you should choose GSS
You May Not Have to Choose
At Global Shared Services, we pride ourselves on meeting all of our customers’ needs. We can accommodate your needs for everything from bookkeeping to virtual CFO services. For our smaller clients, we have packages with just one to two accounting functions. For our larger clients, we can accommodate full service accounting functions plus high-expertise CFO services.
GSS is here to meet all of our clients’ needs. We believe everyone should have access to experts. Are you looking for outsourced accounting services? Contact us today.
Looking to Grow Your Franchise and Save Costs?SEE OUR SERVICES
With GSS, we meet our franchisor requirements on time and with accuracy. The local CPA could not handle our volume. We are so happy to have made the change. GSS knows our business and our franchisor requirements.Multi-unit fast sandwich Owner