When speaking to new clients we always get a consistent question; I am unsure if I need a bookkeeper for my business? In many cases we have found if a client is questioning whether there is a need, more than likely they should investigate getting one.
There are two important things every small business owner wants – and needs – to keep things running successfully: time and money. Choosing a bookkeeper for your business is one way to give you everything you want (and need).
There is sometimes false economies that a bookkeeper will cost your business money but what many business owners forget to do is cost themselves doing the work themselves. How many of us are guilty of spending countless weeknights and weekends catching up on paperwork or even doing the work during the day when we could be using this critical time to build our business, make sales and actually do what we’re trained to do (and outsource the rest).
There are numerous reasons your business could benefit from a bookkeeper but I’ve narrowed it down to the top six for you:
If you have come to the realisation that your business may benefit from having someone help with your bookkeeping, make sure you partner with the right firm.
There are many providers of bookkeeping services out there but it essential to ask the right questions before selecting one for your business.
Here are some tips to keep in mind when choosing a bookkeeper for your business:
Like many industries, you need to remember you get what you pay for and your bookkeeping partner should be aligned to your business.
At Galaxi Bookkeeping we pride ourselves in the level of service we provide to all our clients and are always available to answer and add value. We have a resident CPA member who oversees all the work and ensures books are kept up to date. Furthermore, our experience across many industries allows us ensure that you, as the client, gets the right information the first time around.
As a small business owner, there’s nothing worse than having overdue accounts – funds you could be using to enhance sales, replenish inventory or simply make necessary payments to your own suppliers.
Overdue debt is that fragile relationship between wanting to get paid and not wanting to upset the customer that may put a strain on future work. Having the right process and understanding is key to ensuring that overdue debt does not get out of hand.
While there are always going to be those select invoices that take a bit longer than usual to complete, it should be the goal of any small business to reduce overdue accounts. Overdue debt cannot be avoided sometimes however there are ways of achieving success without being overbearing or rude, in fact, there are quite a few proactive solutions that will help reduce the chance of debt becoming overdue.
Understand your Prospects
Guess what!! There is such a thing as a bad customer. When quoting a prospective client do your due diligence on who they are and the reputation they have in the marketplace. This will give you a first glance of any potential issues you may have in the future, if red flags pop up don’t be surprised if you take on the risk and the debt become overdue.
If red flags do appear, we suggest to;
Letter Of Engagement
Having a clear understanding between you and your client is nothing new, create a Letter of Engagement for your business which outlines clearly what each parties’ expectations is. This is critical if you operate a business which is based on retention of continuous work.
This will become quite useful if you ever run into a client who won’t or is slow in paying their bills. Furthermore, this becomes a golden document in the unfortunate event of having to escalate and go to court. Where you sell products or one-off engagements, Letter of Engagements are still considered useful but ensure that payment terms and method of payment are clear on the invoice.
The Letter of Engagement should contain key information such as;
Another way to reduce overdue accounts is to understand what risks you are happy to take and more importantly ensure everyone in your business is on the same page. This can be done by writing a clear and concise credit policy that highlights your terms and conditions. The policy should contain information such as general payment terms offered, process of escalation and reminders and timeline of steps taken before it’s turned over to a collection agency.
Don’t forget to review these policies periodically to ensure they remain current and cover trends in the economy and payments from clients.
Most accounting software now come with functionality which allows you to setup reminder letters and monthly statements. This allows your clients to keep track of what is due and give them a friendly reminder when something may have been missed.
We operate in a world where many businesses get hundred of emails and notifications each day, and sometimes even with best intentions your invoice may go missing or fall part of the dreaded spam. Sending a friendly reminder allows the client to be aware that payment of an invoice was missed. What is even better, is that clients can also be excluded from the process in most cases so you can manage who gets what and when.
If your business is unique there are always third-party providers which integrate to you accounting software which allows you not only to manage your debt but also integrate with payment platforms.
Contact us if you need assistance in setting this up in your business.
As a business owner, you also need to stay on top of outstanding debts to reduce overdue accounts. Nothing is still better than this, run your reports or setup your accounting software with the right information on the dashboard.
Do not be afraid to pick up the phone and have that friendly discussion with your client as to why an invoice may be outstanding. This will allow you to quickly identify what steps you need to take to get the invoice paid.
While it’s frustrating to deal with slow-paying clients, reduce overdue accounts by implementing your own unique solutions and create clear guidelines as to what you expect from those working with you!
New technology is around us all the time – from doing banking on a smartphone to checking email on a watch, but have you ever thought to integrate new technology into your business? Taking that leap from the traditional way of doing things can be a little scary at first, but in the long run it’s often easier and more helpful for managing a business efficiently. There are plenty of benefits of using online accounting, let’s take a look at some of them now:
Cloud-based accounting software offers so many benefits and really makes owning a business a little less stressful. Software options such as Xero imports bank information directly, making it even more accurate and easy to use!