Why Outsourcing Your Accounting Functions Can Save Your Business Money
Your back office serves as the backbone of your business, providing support services that are essential to keep your team stable. One of the roles within this non-client-facing section of your business includes accounting and finance which is responsible for providing accurate accounting data and paperwork, keeping track of compliance and regulations, preparing and submitting taxes, composing income reports, cash flow forecasting, and more. This blog will tackle why outsourcing your accounting can help you boost your cost savings.
In recent years, accounting and finance functions have become assigned to another group outside the company. Outsourcing these roles in favor of cost savings and highly-skilled employees. Unfamiliar with or hesitant to outsource your accounting functions?
This article will explore how you can boost your savings by outsourcing your accounting needs.
7 Reasons You Should Outsource Your Accounting Functions
Increased Cost Savings on Labor
The first way outsourcing can reduce your costs is simply by lowering how much you have to pay to have a dedicated, in-house accounting team to cater to your company’s needs. A team of around 5 in the accounting and finance department would need salaries, benefits, overtime pay, PTO, etc.
These costs would be reduced should you choose to outsource these functions, especially since your
funds would mostly go to the outsourced employees’ salaries and not much else.
Should you choose to hire remote employees from a country with a lower cost of living — this would save you even more money while still maintaining the ethics of providing good salaries to your employees.
Overhead costs such as office space and equipment can add up when you think about hiring an entire team for your accounting and finance functions. You will also have to think about maintaining these items as well as providing training and holiday pay.
Clutch, the data-focused authority on business buying decisions, noted that 37% of their surveyed US small business owners choose to outsource their accounting functions. This is related to their capacity to hire and sustain an entire accounting department.
Highly Skilled Work Force
Hiring competent workers will always save you money— whether it is through reduced cases of miscalculations or just a more productive and time-saving team. outsourced workers oftentimes specialize in providing the specific service you
are asking for which allows them to be more attentive to completing their work properly.
Access to Expertise
A number of smaller teams cannot maintain hiring a few accountants to do their accounting, especially considering the overhead costs. However, every business needs the expertise of an accountant, especially since this department is
essential for keeping up with taxes and other regulations. As such, the need for expert outsourced accountants becomes clear to any business owner who wants accurate records.
Optimal Use of Time
Depending on your own agreement with your outsourcing provider, your outsourced employees would probably be paid by the hour. This can make it more transparent how much work they are able to accomplish within their shifts. Consequently, you can expect outsourced accountants to be more productive and efficient with their time. You will be able to get the bang for your buck at a pace that is much more conducive to a fast-paced workplace.
Scalability for Seasonal Boosts
There will be times when you need more employees for those workload-heavy months. It might be the period leading up to tax filing or when you are planning to launch a new product and need more specialized finance insight. Whatever the occasion, you will be allowed flexibility by outsourcing these functions. In the end, you
will be able to save money because you won’t need to retain an in-house employee for these busy seasons.
The Bottom Line
There are several reasons why outsourcing Your accounting can help you reduce your costs which can ultimately increase your bottom line. With lower labor expenses, lower overhead costs, increased competence, error-free work, and productive use of time, outsourcing your accounting functions might be the most revolutionary decision for you.