If you're a business owner, I bet you’ve been told you should be forecasting. This traditional advice suggests that there is a specific model to follow or a manual to use. However, as you and I both know, the reality is that when life gets in the way, your forecasting...
Don’t DIY Your Finances—You Need a Pro
Bookkeeping services aren’t free. However, odds are small business professionals that trust their numbers to a financial firm will find the outlay pays for itself in a short span.
As a small business professional, you run a highly specialized organization that excels at providing stellar product and service to your clients. There’s nobody better at what you do than you. Similarly, as the founder of My Small Business Pro, I’ve spent more years than I care to share handling money for all sorts of businesses, ranging from itsy-bitsy ones to multi-million-dollar organizations. I‘m a numbers person—and, because I’ve been knee-deep in QuickBooks, P&L statements, credit card statements, invoices and other financial-centric stuff for the better part of my career, I’m pretty good at seeing how those numbers impact different businesses.
However, as great as a small business professional might be at their area of specialty, they can’t do everything, or know everything. That’s why it’s good business sense to delegate to specialists—especially when it comes to your finances—to cover weaknesses and blind spots. For example, how would you know if someone was stealing? What would you do if you accidentally overpaid your payroll taxes? If you have more than one company, and you purchase stuff for one organization through the other, how would you know if you’re making a profit? Professional bookkeeping services offer the expertise to spot such problem areas and handle challenges. Here are some more good reasons why you should hire bookkeeping services, rather than going it alone.
You put the “busy” in “business.” Reconciling your accounts, chasing down invoices, P&L statements—all those financial-related things take time. Trouble is, as the head of your company, your to-do list already is miles long. All too often, the money stuff gets put off, or avoided completely—and it gets harder to make time for and manage as your firm grows. Recently, a client asked to reschedule our monthly meeting where we review her financial statements. After a number of emails, phone messages and other attempts to reconnect, that rescheduled meeting never happened. Clients, employees, repairs, life – they all got in the way. I’ve seen it before—the owner sees money is coming in, bills are getting paid and the lights are still on, so they put the numbers off. Unfortunately, if you’re not a financial specialist, you might be missing little things, and those small issues can become huge problems as time go by. It’s always better to engage your bookkeeping services provider sooner, rather than later, so you can avoid worries and instead concentrate on growing your business.
Expert eyes catch things you might miss. Another valued client found himself struggling to reach profitability. His billing was being handled by an external partner, but the client wasn’t reviewing the billing to make sure everything was kosher. Thankfully, the client tapped MSBP to conduct a review. This assessment uncovered services the client was paying for, but that weren’t being passed along to the customer. For example, some of his customers needed physical documents, requiring overnight delivery. While my client was getting socked for lofty FedEx charges, his external partner failed to bill customers for the cost MSBP’s expertise helped find a leak that was basically invisible, and we plugged that leak to correct an annual loss of about $13,000.
Bookkeeping services pay for themselves. One more story: a restaurant client operated a point-of-sale system which, like most POS systems, featured two components: the POS itself, and the credit-card processing. MSBP was able to look at the operation and determine they weren’t correctly synched, meaning things like taxes, gratuity and other items were mucked up. I’ve actually had three different clients whose POS systems weren’t correctly synched with QuickBooks. It’s a nightmare that takes a long time to wake up from, and it’s not something a bargain-basement bookkeeper could spot. An experienced financial services firm can, saving your company money, time and even legal trouble. When it comes to managing your business, you get what you pay for, especially with bookkeeping services.
Expertise is worth the added expense. While it might be tempting to log onto Craigslist and hunt for financial help, it’s a temptation you should resist. Someone charging $25 per hour to handle your financials might look great, but the truth is, someone charging such low rates likely won’t do much more than simple data entry. If you want someone experienced who can really help you increase your profitability, you’ll want someone experienced with financial statements, several versions of QuickBooks and an understanding of how businesses manage based on finances. A new MSBP client engaged our services and I determined the ill-equipped “bookkeeper” had overpaid payroll taxes to the tune of $5,000. Untangling the knot required a ton of time, and about $500 in billable hours, but considering I was able to get the whole $5,000 back, that’s quite a return on investment.
Professional perspective can fix big messes. One more story: I regularly reconciled the books for a client, but she wasn’t a fan of attending our occasional meetings. I determined her business had several thousands of dollars of unreconciled cash receipts (if your business handles cash and you don’t know what that means, you should probably pick up the phone right now and call MSBP). I spent months pleading with the client via phone and email to touch base so we could sit down and review the receipts, which didn’t match any bank deposits. Fast forward to several months later, when my phone rang. The client’s accountant discovered a $10,000 hole in her funds—it turns out her “partner” (a.k.a. her daughter) mistakenly thought she could just help herself to the till because, after all, she was part owner. The client set her daughter straight, and MSBP helped the client get their funds back on track.
For better or worse, the desire to take on everything yourself is a common habit among small business owners. However, good leaders delegate—contact me at Daliah@MySmallBusinessPro.com and we can talk about how delegating your financial management can pay off for your operation.
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Schedule a meeting with Daliah Fritz