It’s no secret that running a business is extraordinarily difficult. Beyond overseeing day-to-day operations, there’s just as much work going on under the hood to make your business run smoothly. These back-office operations are where many businesses can find themselves bogged down. Many smaller businesses don’t have the expertise, time, or capabilities to handle these operational tasks. Business leaders having difficulty with mastering the financial side of running a business plays a huge role in the fact that half of all businesses founded five years ago no longer exist. Furthermore, running out of money by failing to properly manage finances is often the main reason small businesses fail. Without a strong accounting department, it can be difficult to understand how your business is positioned financially, thereby greatly increasing the risk of collapse. 

In this article, we cover five of the biggest indicators that your business may need assistance from an outsourced accounting service.

Errors and Inefficiencies

One of the most obvious indicators that your firm could benefit from outsourced accounting is a tendency for errors and inefficiencies in your existing accounting functions. Best-in-class accounting requires years of discipline-specific education, certification, and experience that the vast majority of small businesses don’t possess.  Errors and inefficiencies, even minor ones, eventually begin to add up and can hamper any business.

The silver lining is that these mistakes are preventable. By outsourcing your accounting and bookkeeping functions, you can insulate yourself from any potential mistakes that can occur from having an inexperienced or unqualified individual responsible for your finances. This will allow your business to operate as efficiently as possible, and for you to make sound financial decisions.

In addition to creating mistake-free books, outsourced accountants are able to do your bookkeeping far more efficiently. While you may have needed to wait long periods of time for your internal accountant to generate reports and insights, best-in-class outsourced teams can do so in a fraction of the time by virtue of having access to the best technology and processes. This will streamline your business processes and ensure your company is operating as efficiently as possible.

Time Wastage

If you or your accounting team is consistently working overtime to manage daily bookkeeping responsibilities, there is clearly an opportunity to be seized with outsourcing. The accounting process can be incredibly complex, and without an individual or team solely dedicated to accounting, it’s very easy to fall behind and find yourself drowning in work. 

When the burden of doing your own accounting is lifted off your shoulders, you’ll have more time to focus on what really matters. Whether that is building relationships with clients, perfecting the nuances of your services, or whatever you do best, you’ll have the opportunity to direct all of your energy towards that goal instead of sweating the details of your firm’s accounting and bookkeeping.

Your Business Is Growing Fast

Although you may be able to handle the accounting functions for your business at the present moment, this doesn’t mean you’ll be able to keep up in the future. Any business with serious growth aspirations will inevitably experience growing pains. These pains can often arise in departments like accounting, where you or your staff find yourselves swamped due to an increase in transactions and complexity. Even if you know your way around a balance sheet, you can still be in trouble. 

As with any ailment, prevention is the best medicine. By outsourcing the accounting function of your growing business, you can prevent the errors and inefficiencies before they occur, and ensure that your growth trajectory is not inhibited by back-office operations. If you intend to scale your business quickly or are currently in the midst of a high growth phase, the time to outsource your accounting is now.

You Need To Cut Costs

According to a recent article by Forbes, one of the main benefits of outsourcing is the ability to slash costs, especially for a business function like accounting. You’ll almost certainly end up paying far more to hire and train an in-house accountant or team than if you had outsourced the function. In fact, Deloitte’s 2020 Global Outsourcing Survey found that the most popular reason for outsourcing was cost reduction. 

Although cost reduction is a great reason to outsource your accounting, a common concern of many business owners when considering outsourcing is the potential for quality to suffer as a result of lower costs. 

This can indeed be a concern depending on the outsourcing partner you select. However, the best accounting and finance professionals combine low costs with decades of experience in the industry, allowing you to simultaneously access seasoned financial experts and decrease costs.

Your Accounting Software is Confusing or Antiquated

A Chamber of Commerce study found that 82% of small businesses rely on accounting software to balance their books. Unfortunately, most accounting software can be confusing and difficult to navigate if not placed in expert hands. Many accounting softwares also don’t provide access to new technology and tools that can have a tremendous impact on your business. 

Best-in-class accounting specialists allow you to benefit from all the valuable financial insights without having to spend the time perusing through tons of sheets and data. Top accounting partners will offer real-time, easy-to-use dashboards and graphics that communicate your business’s finances in a simple, impactful way.

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If your business is experiencing any of these five symptoms, it may be time to seriously consider outsourcing your accounting and bookkeeping functions.  finairo offers comprehensive outsourced accounting, bookkeeping, and finance solutions that empower your business to make informed decisions and maximize growth. Our experts have decades of operating experience across multiple industries and utilize best-in-class technology to ensure maximum data visibility, making it easy to understand your firm’s financial situation. 

Request a consultation to learn more about how finairo can help empower your business through accurate, timely, and insightful financial practices.