For food business owners, staying on top of bookkeeping is essential to the success of your business. As your business grows, you might find that managing your own financial records can be a bit draining, especially if you’re not as passionate about bookkeeping as you are about being in the kitchen. Therefore, it might be time to weigh the pros and cons of hiring bookkeeping help. Now the question is, should you outsource or hire an in-house bookkeeper?
In this post, we'll explore the benefits of outsourcing versus hiring an in-house bookkeeper for your food business, and I’ll provide some insight into which approach may be best based on your business needs. Outsourcing provides an experienced and dedicated team of professionals with specialized bookkeeping skills, while hiring an in-house bookkeeper can give you more control and convenience. We'll explore the advantages of each and identify the key factors to consider when making a decision. Ultimately, by understanding the benefits of outsourcing versus in-house bookkeeping, my hope is that you'll be able to make the best decision for your business.
1. Reduced Costs
Outsourcing bookkeeping services can be more cost efficient than hiring an in-house bookkeeper.
A main benefit of outsourcing a task in general is a reduction in cost, and the same applies to outsourcing bookkeeping. When hiring any in-house staff member, you’ll have the added cost of providing training and other employee benefits such as insurance, additional office space and equipment. By outsourcing your bookkeeping, you can simply pay for the service as needed on a monthly or quarterly basis. Paying for the services as needed will likely result in a lower cost related to bookkeeping.
2. Expertise and Experience
Both in-house and outsourced bookkeeping services allow you access to an experienced accounting expert.
When it comes to managing finances, whether you decide to hire an in-house bookkeeper or outsource the service you’ll (likely) have the added benefit of working with someone who has more expertise in the field of accounting than you do. Both types of bookkeepers will have the expertise and experience to quickly and accurately handle financial operations. Working with either type of bookkeeper will allow you more time to focus on your core product and services instead of worrying about bookkeeping tasks.
However, an in-house bookkeeper will have an advantage over a third-party bookkeeper in that they will have more intimate knowledge of day to day business operations. For example, an in-house bookkeeper whose office is within earshot of the kitchen or customer service area will likely know when customer issues arise or when unexpected vendor expenses pop-up. This level of knowledge will allow an in-house bookkeeper to work a bit more efficiently than an outsourced bookkeeper.
3. Improved Accuracy
Outsourcing bookkeeping reduces the risk of errors due to lack of experience or improper record keeping.
When working with only one in-house bookkeeper, the assumption is that they have the necessary expertise to handle all bookkeeping challenges. However, this may not always be the case. Therefore, opting to work with an outsourced team of bookkeepers, can provide you access to a more comprehensive and diverse range of skills and knowledge. This can prove to be a beneficial approach in managing various bookkeeping tasks effectively.
By entrusting your bookkeeping tasks to a reputable third-party, you can anticipate a significant improvement in the accuracy of your financial records. Third-party bookkeeping companies typically have a pool of skilled bookkeepers who are knowledgeable and experienced in various accounting practices. Additionally, these firms are equipped with the latest technology and software, ensuring that your financial records are kept up-to-date and accurate. This will further minimize the likelihood of errors that may result from a lack of experience or incorrect record keeping practices. Therefore, outsourcing your bookkeeping tasks can be a valuable investment for your business, allowing you to have peace of mind and focus on growing your operations.
Outsourcing bookkeeping services allows business owners to scale up or down depending on the season or the workload.
The workload that comes with bookkeeping does not remain constant and tends to fluctuate throughout the year. Therefore, it makes the most sense to outsource bookkeeping services to a third-party so that you can avoid the hassle of hiring a full-time staff member who may be underutilized during slow seasons and overburdened during busy seasons.
One of the primary advantages of outsourcing bookkeeping services is scalability. By working with a third-party, you can easily adjust the level of bookkeeping service required to match seasonal trends or fluctuations in workload. For instance, if your bakery specializes in wedding cakes you might experience a surge in demand during peak wedding season, requiring a temporary expansion of operations. On the other hand, during the slower months, you may need to scale back operations. Managing these fluctuations with an in-house bookkeeper could present a challenge, but outsourcing bookkeeping services provides the flexibility needed to manage such changes seamlessly.
In conclusion, there is no one-size-fits-all solution when it comes to bookkeeping. Ultimately, the decision to outsource or hire an in-house bookkeeper will depend on your specific business needs and goals. By carefully weighing the pros and cons of each option, you can make an informed decision that will benefit your business in the long run. Regardless of which option you choose, the main goal of hiring a bookkeeper should be to free up your time so that you can focus on growing your business, while ensuring your financial matters are taken care of by a skilled professional.