Bookkeeping Service: Why is it a Great Idea for Small Businesses in this Economy

Every time you turn around the news is talking about the deteriorating state of the economy. “7% of Minnesotans’ are unemployed in the month of January”. “The Deficit is going to increase by 1.4 trillion in 2010”. Times are tough and the outlook for the future is not good. What does that mean for a business owner?  Sales cycles are long and spending is limited or non existent. Consumers and businesses that are spending money have the advantage. They know it pushes down prices and shortens the lead time. Business owners have to be on their game, controlling cost, focusing on your core customers and scratching for all the business you can.

Now is the time to think about a bookkeeper. I know what you’re thinking how does hiring someone help me cut costs?  The answer is hiring a bookkeeper won’t cut costs, but there are alternative to hiring employee’s. Bookkeeping services are an up and coming trend for many small and mid sized businesses owners.  The trend is gaining stream for to reasons; time and money.

I read an article the other day that said 61% of small business owners work 6 days a week and 20% work 7 days a week. How much of that time is spent doing paperwork? 1 in 6 days? If you spent that day, just that 1 extra day a week focused on generating more sales that’s 52 extra days a year. How many sales calls can you do in a day 3-4 that’s between 150 and 200 extra sales calls per year how much would that effect your bottom line?

The going rate for a bookkeeper in Minnesota is around $34000 per year, $16.50 an hour. If you add to that another 25% in overhead (taxes, insurance, vacation) on average in Minnesota a bookkeeper will run you almost $45000 a year. This is the decision most small businesses are faced with. Can this extra cost be covered?. Most would say no. But, consider that a bookkeeping service only works when the need is there. Even at $25 per hour if they work 4 hours a day that $26000 per and no overhead, your saving almost $20,000 per year! A bookkeeping service is on demand, a bookkeeper is all or nothing and the difference in term of your dollars can be significant.

Today’s economy is forcing business to beat the bushes for every scrap of business they can. Business owners have to focus more and more heavily on sales efforts, customer contact, and networking. This leaves the day to day and financial management tasks necessary in keeping a business running smoothly and efficiently unattended. The growing trend of bookkeeping services is a viable and cost effective alternative to a traditional in house bookkeeper.

 

 

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