There is a time in every child’s life when you as a parent may ask yourself “why outsource accounting services?” I mean a time in every companies life!
Parenting a Company 101
When your business is young you look at it with such pride, “Look at what I’ve created! I have such hopes for your future.” However, as it starts to grows you feel frustration when things don’t always go as planned. It starts to stink in places you didn’t think it would ever stink. (Comparable to your teenage boys smelly room and your product margins during that last big fire sale). You start to realize you have so many unanswered questions like “Where were you last night or where did all my cash go?”
Similarly, when companies start to experience significant growth, owners may start to feel overwhelmed or as if they are losing touch with how their company is actually doing. This is akin to attempting to figure out the current state of your teenagers well-being. You have to ask a lot more questions to figure out what is going on, and there’s a lot more that goes into getting the answers you’re looking for (like why is your room still smelly?). If you haven’t put the right measures in place from the beginning, the right expectations, it’s a lot harder to do so at this point in the game. For as you may well know…teenagers don’t forget anything so you can’t start making up rules now!
Establishing a Support System
From inception your company should have a capable financial recording software such as QuickBooks Online. As your company grows, this helps create a transparent picture of your company’s financial well-being. This is pivotal, as you won’t have as much time to keep tabs on every aspect of the company yourself. This part of the growth cycle is like meeting your child’s teachers, coaches, friends and their parents. Then establishing these relationships so you can know how your kiddo is doing. Unfortunately, you can’t follow them around like a fly on the wall, (as much as you might be tempted to). Why? Because this will utterly humiliate them and probably isn’t super healthy. Teenagers..am I right?
Just as you need extra help monitoring your child’s well being, in addition to QuickBooks, you will need payroll software (e.g. Gusto), an inventory tracking tool (click here to see software comparisons), a streaming bill pay service (e.g. Bill.com), and sales tax software (e.g. Taxify). Incorporating these types of programs is an important consideration when you reach about half a million in sales.
Why Outsource Accounting Services; Don’t Parent Alone
These programs will help make your job easier when it comes time to decide to outsource your accounting. Eventually however, they are just not sufficient on their own. They say it takes a village, and I would say that applies to both growing teenagers and growing companies. Outsourcing your accounting can help you recruit those necessary mentors that help make your task easier by shouldering some of the burden and responsibility that comes with being an owner/parent.
Click here to read about the common fears and misconceptions associated with outsourcing your accounting.
When a teenagers hormones reach about a half a million in craziness, you know it’s time to recruit some good help. The same goes for companies who are doing about half a million in revenue, you’re likely to have a teenager with a million raging hormones next year and you are going to be wishing that you had established a support system before it got to that point. Babies become teenagers, and smaller companies grow.
Why outsource accounting? Because the more hands you have to help lighten your load, the better able you will be to maximize the quality time you spend on your company kid.