Most small businesses fail within the first few years because they focus mostly on developing their product and trying to figure out how to get customers and don’t look at the financial side of the business. Entrepreneurs often miss the importance of understanding the basics of bookkeeping in their small business. In return, this leads to poor performance, poor sales and eventually failing in the business management aspect.
The most important key to having a profitable, growing business is knowing that the heart of any business is the business finances. Understanding business finances, in the long run, can make or break the life of the business.
Accurate bookkeeping is an essential component of small business success.
This is why you need the help of a bookkeeper. Bookkeepers can manage lots of different responsibilities within a small business, but the main focus is the organization, recording, and reporting of financial transactions as part of the operational life of a small business.
Here are 6 Ways a Bookkeeper Can Be Invaluable to Your Business:
1. They Help You Focus on What Matters
A bookkeeper will set up your bookkeeping system properly for your business and manage your books in a timely manner. A bookkeeper will ease any concerns towards your business financials, leaving you to focus more on developing your business growth and structure.
2. They Help You Save Money
A bookkeeper cost less than a full-time employee and is a more cost-effective solution to your bookkeeping tasks. With a bookkeeper, you only pay for the time used to work on your books, whether it be day-to-day or semi-weekly. Never pay for more than you require. You don’t have to worry about the stress of high turnovers based on employees performance or dedication. This saves time, money, effort, and energy.
3. They Can Help With Your Finances
A bookkeeper can track and monitor your business finances, showing you how much profit you’re making or how much you’re losing. They also provide you with the tools to be aware of where your money is going and when it’s coming in. A Bookkeeper can identify opportunities or financial trends you may not have noticed yourself, on ways to save money or make more money.
4. They Give Professional Guidance
A bookkeeper will be able to guide you through the financial statements (Income Statement, Balance Sheet, Statement of Cash Flow) and show you what those reports and the numbers on them mean for your business.
5. They Give You Efficiency of Decision-Making
With a bookkeeper, you have better access to financial information related to sales, customers, overhead, profit, and other issues. A bookkeeper, can pull specific reports based on management’s needs and make it easier to make quick and educated business decisions.
6. They Can Help You Plan Business Growth
A bookkeeper can help you deal with growth transitions. From hiring more employees, looking for a bigger office space, and market expansion.
Bookkeeping is the least favorite task of most small business owners mostly because it can be overwhelming and society at large is often undereducated in finance and money.
Hiring a bookkeeper can be very beneficial and a serious weight off your shoulders. A bookkeeper can be an investment to your business providing you with the necessary means to business management, maintain growth and control your profitability.
Photo by Anka Albrecht
Marilyn, I made the mistake of doing my books for ages. I was okay, but to be honest, it was a nightmare. Accounting and bookkeeping are just not where my time is best spent. The funny thing is although I did a fair job, anytime I found errors in my books, it was a true mess and my accountant needed to work a lot of extra time to fix the messes I created which got very costly. When I hired a professional bookkeeper it was a huge difference in the experience I was having. My books were really clean and the reports were very organized. This can make a huge difference in your business. It also is very helpful when you are not a finance expert you have a support person or team to lean on to become more knowledgable of the reports and what they means as well as deciphering the data on those reports. You thoughts here are great and I couldn’t agree with you more on how important this stuff is.
Thank you Dale. I agree with everything you mentioned and delighted you enjoyed the article. It’s very important to have the support and expert advice you need in understanding and outlining the details needed to be successful in your small business.
Having the right support it extremely important. Thanks for these tips.
This is such a helpful article! As one who hates anything to do with finances and is woefully scared of it all you make the idea and topic not so scary. I am glad you are on this mission to help others. It is so important to train people to know how to handle their finances and book keeping. Can’t wait to read more articles.
Thank you, Deb! Finance can be scary and a touchy topic for many in the business world. I would love to hear what stood out to you most in the article.
Deb, finances are such an important part of business and sadly this stuff is not easy to master if you do not have a mindset for it. Small businesses do not have great resources to step up their game in this area. I am hoping that writers like Marilyn and Josh will help business owners to get more comfortable with this stuff. Thanks for your comment!
Yes Dale is correct. Finance takes patience but this can be said for all aspects in running a business. The biggest thing I dealt with when I started my business was Sales. Why, because it’s not something I was familiar or comfortable with and in order for me to gain the understanding I needed in developing my business outlook I had to seek professional advice from someone who was willing to teach me.