“Show me the money” is how the saying goes. Finance and accounting help with that part. You want to show the money, to investors and to your employees. At the same time, you don’t want to spend so much money that an accountant is running the business. This especially applies when you are an entrepreneur with a potent startup.
Outsourcing your financial functions is one viable alternative, by soliciting services from a team of accountants. Skip the arduous hiring process and ask a contractor. This applies to both large and small businesses, and for the latter engaging in outsourcing can help reduce your costs.
Why outsource your accounting? We can offer many reasons. Below are our top six, and these just scratch the surface.
Smaller Budget And Reduced Costs
Basic business sense dictates that you should at least break even and turn a profit, and look to see where you can optimize expenses. If you hire an entry-level accountant in-house, they will demand an annual income of at least $48,000. The issue with that, however, is their inability to perform some of the higher-level analysis that a business owner needs from a true Financial Wingman™. You can get more value from an outsourced accounting firm for the same pricing.
Unfortunately, at the whitewater stage of between 1 to 3 million dollars in revenue, businesses have all the big boy problems without the big boy pockets to throw money at it. Having a proper team of accountants that can provide all the necessary functions is cost-prohibitive and unnecessary. Outsourcing services can provide a better alternative.
For a small business that is doing more than a million-dollar in revenue, you start finding the need to build structures and systems to continue the growth. The hustle and hard work that got you here simply wouldn’t get you where you need to go.
The first step is identifying the problem in question. Figure out if you want to prepare your financial statements, organize transactions or streamline payroll. Once you know what you need to solve, you can ask outsourcing services to help, to decide if you need a CFO, a controller, or program developers. Or you may need all three!
Next, set your budget and you will find an outsourcer for that designated amount. Aim for 3% of your annual revenue for the year. Determine the amount you’re willing to pay based on how much value you hope to receive in turn from your expert. Many outsourcing firms will provide base estimates depending on these factors and your needs.
Between a $500-1500 range for a monthly accounting budget, you can use automated services to get the basic bookkeeping and tax management. We recommend that when you earn 1 million dollars in revenue minimum that you pay for human accountants. Within a $1500-2000 budget, accounting services will handle your monthly close and can prepare timely financial statements. They also should sit down with you and analyze data appropriately.
If you decide to pay $2000-6000 a month for accounting, then you need to find an expert who goes beyond basic accounting. They assist with your systems and will make suggestions to streamline processes. They provide the action steps that you need to take your business to the next level. If you go above $6000 for your monthly budget, you can afford an in-house employee but the outsourcing services will be less expensive and provide higher-quality services.
To cover all the required functions in your business, a CEO will need a CFO for a couple of hours per quarter, a controller for a few days a month, an accountant and a bookkeeper 3-4 days a week. Finding one single person who can perform all these tasks can prove costly. It’s also rare, and more like you will have to find four people who are willing to work those hours.
Even so, you may not need to hire any of these employees full-time or even part-time. Outsourcing changes the game so that you aren’t limited to people who need to appear at the office. You don’t even have to pay by the hour! Instead, you can pay for services, rather than for people.
Outsourcing accounting firm specializes based on the exact services that you need. You won’t need a full-time person on staff or to break the bank to do basic accounting. We can be your CFO, controller, accountant, and bookkeeper for the time that you need.
More Focus On Your Core Specialties
When you are delivering valuable products and services to consumers, you would rather focus on the production and delivery parts of the process. This is especially true if you specialize in niche products.
An owner can only juggle so many hats. If the office manager is swamped with projects and the CEO is talking with clients, then who should handle the money? Outsourcing means that your managers can focus on people, not payroll or budget.
Expertise About Tech Updates
The first lesson about tech and business is “you need to know what you don’t know.” That means you have to identify your gaps in knowledge. The big issue with tech is that advances in programming, social media and devices can span common knowledge.
Let’s go back to when you the client comes to us with a problem. If we know that you need more organized financial statements or such, we can help better.
Accounting software, like other programs, update and change with the times. If you don’t keep up on these updates, then you may lose the opportunity to optimize your services. The problem is that software can become expensive with every upgrade.
Outsourcing accounting firms make it their priority to keep up to date, so as to remain competitive. DeepSky is one such firm that knows which accounting technology platforms work, and which are wastes of code.
Accountability: Financial and Otherwise
Running a business owner means that you want to know when the numbers add up. Apart from the punny sense, you literally want to account for every dollar. While you hire honest employees, you would rather err on the side of caution in the case of in-house employees accidentally going over budget or ordering the wrong supplies for the office.
The risk with an in-house accountant is that they may face bias about their performance. People want to fit in at the office, and not make waves. Or they find their personality clashes with that of the office. You find that they cannot meet your expectations, and deal-breaking scenarios ensue.
An outsourced accounting firm doesn’t need to worry if they blend with your office environment. They hold CEOs and other executives accountable, by showing them results. We can be a part of the team thanks to outsourcing, without even needing to be in the same area.
Within DeepSky, we are result-oriented, straightforward, brutally honest about their business status. That’s how we hold our clients accountable. At the same time, we want to be considered as part of the team that we truly care about them. We provide monthly reports to reflect a business’s financial health. The analysis is more objective.
Sense Of Security
Experts always operate DeepSky as part of a team. We have accountants, CFOs, and outsourcers. Our hiring crew knows how to find the talent that your business requires and saves you the same.
In addition, we can meet your expectations regarding non-negotiables. If you need our team to join your inter-office Slack or such, we can do that. Or if you need more frequent updates than our standard, we can meet your expectations. We can even prepare reports on exact dates. When you tell us what are and aren’t deal-breakers, we can better serve you.
When a trusted accounting firm takes care of your services, including outsourced finances, they become your FINANCIAL WINGMAN™. You have specialized experts working to ensure that your dollars are in good hands. Rest easy at night knowing that you have experts looking out for your financial wellbeing and will let you know if something goes wrong
Finally, you can review these services online and verify their quality. With in-house, the problem is that people are variable and can change over the course of a few months. Contractor firms will not vary. We take pride in making sure that our work quality is consistent.
Learn More From DeepSky
At DeepSky, our accounting services are meant to help your business grow. We have extensive expertise in managing numbers and upholding company responsibility.
Contact us today. Skip the hiring in-house and find an expert in financial management.