What is Virtual Bookkeeping?
As the name suggests, virtual bookkeeping is fairly self-explanatory. Bookkeeping services handled virtually instead of by a team member on-site. You’re able to reap the rewards of top-tier bookkeeping without dealing with many of the costs associated with an in-house team member.
This is where the savings come in.
How Virtual Bookkeeping Can Save Your Business Money
There are many different ways that virtual bookkeeping can save you from the costly processes of hiring an in-house bookkeeper. However, we’ve chosen 5 that we believe are the most important.
1. Overall Cost of Virtual Bookkeeping vs. An In-House Bookkeeper
Going the in-house bookkeeper route can be costly. We’re not just talking about salaries here, either. There are several other costs associated with any full-time employee that often don’t get enough attention, including:
- Employee benefits
- Additional training
- Office space
- Vacation pay
- Potential relocation costs
Virtual bookkeeping services have a fee attached to them as well, but you won’t be forced to pay up for these additional costs attached to a full-time hire.
2. Virtual Bookkeeping Can Optimize Productivity
Any in-house bookkeeper that you choose to bring onto your team will need vacations. They’ll have sick days. They’re going to need paid time off for one reason or another. All of these scenarios are unavoidable, and yet someone still needs to handle the books while your in-house bookkeeper is off for days or even weeks. If your books are left unattended for longer periods of time, this can end up costing you more money in the long run.
Conversely, moving your bookkeeping off-site will ensure that your bookkeeping tasks are always kept up to date. They require no days off since they employ teams of trained professionals to handle these tasks for you.
3. Virtual Bookkeeping Avoids Costly Hiring Processes
Not only do new hires come with lesser-known costs attached to them, but the hiring process itself can be a financial burden.
In fact, in some industries, the hiring process can end up costing you upwards of $5,000 in some cases.
There are several factors that contribute to the elevated cost of hiring a new employee, including:
- Advertising fees
- Sign-on bonuses
- Referral bonuses
- Recruiter fees
- Potential travel expenses
While not all of these scenarios will apply to every company in search of an in-house bookkeeper, many of these expenses are vital to ensuring a successful hiring process.
With virtual bookkeeping, there isn’t really a hiring process. Some research is required to ensure that your business chooses the right virtual bookkeeping service to suit your needs, but this process ends up being far less costly than that of a new hire.
4. Virtual Bookkeeping Can Maximize Operational Efficiencies
While you might have some knowledge of bookkeeping or accounting, knowing whether or not you hired the right bookkeeper for the job can be difficult.
Finding out the hard way can end up costing you more than you might think, too. A fair amount of companies have reported that bad hires have costed them upwards of $25,000.
While it’s entirely possible to go with the wrong virtual bookkeeping provider, there are many different ways to properly vet potential candidates. Using everything from online reviews to referrals, choosing an effective virtual bookkeeping service helps you avoid many of the pitfalls associated with hiring the wrong in-house bookkeeper.
5. Virtual Bookkeeping Can Help Businesses Scale Accordingly
What happens if you’re running a seasonal business? Do you simply tell your in-house bookkeeper to find a new position in the meantime and hope they’re loyal enough to return to you? Do you pay them a continuous salary despite them not doing any work during your off-season?
At the end of the day, a bookkeeper is a bookkeeper. They’re likely aware of what they should be paid, regardless of the size of your business. Why should they take a pay cut when they could go to a different employer and receive more?
With many virtual bookkeeping providers offering different tiers of service aimed at different-sized businesses, you’ll only need to pay for exactly what you need. If your business is seasonal, you don’t need to worry about keeping someone on staff during those down months.
This works in reverse as well. When your business begins to grow and bookkeeping services end up being too much for one in-house employee, you can scale up accordingly with virtual bookkeeping.
Conclusion
At the end of the day, it’s no secret that businesses are looking for ways to decrease spending wherever possible. There are certain areas where cost-cutting is effective, and others where it may not be a great option.
The great part about virtual bookkeeping is that you end up not only saving money but also get a highly effective solution to manage your books and ensure that they’re always kept up to date.
Regardless of the size of your business or the industry you’re in, virtual bookkeeping services are a great solution for you.
