When should you outsource your bookkeeping? 4 warning signs your business is ready.

Bookkeeping is one of the most commonly outsourced tasks for small businesses, and for good reason. As a business owner, you may find bookkeeping to be time-consuming, frustratingly cyclical (it never ends!), and confusing if numbers aren’t your forte. At the same time, bookkeeping is a vital aspect of running a successful business and can cost you if not done correctly. 

The truth is that the more time that business owners spend doing their most important job of running their business, the more they tend to find bookkeeping particularly draining. So, when does it make sense to scratch bookkeeping from your to-do list and outsource? Let’s dive into 4 warning signs it’s time to outsource your bookkeeping.

1.Your bookkeeping simply isn’t getting done

The first and most obvious sign that it's time to outsource your bookkeeping is when you find yourself consistently falling behind on your financial records. As a business owner, you may have the best intentions to keep up with your bookkeeping, but other priorities often take precedence. When you notice that your financial records are incomplete or inaccurate, it's a red flag that you need professional help. Ignoring this warning sign can lead to increased stress and potential legal ramifications down the line.

2. DIY bookkeeping is taking up too much of your valuable time

As a business owner, your time is valuable and often, the success of your business depends on how you spend it. While managing your own books may seem like a cost-effective solution, it can quickly become extremely time-consuming. As your business grows, so do the complexities of your financial transactions. Spending hours each week on bookkeeping tasks takes you out of your zone of genius and away from focusing on your core business activities. Your time is valuable, and, if you’re feeling stretched, outsourcing your bookkeeping allows you to reclaim those hours and redirect them towards activities that drive business growth. 

3. You’re trying to grow your business

Experiencing growth can be a very exciting time in your business, but also risky if not managed. In times of growth, having a clear understanding of your financial health and accurate, up-to-date financial records is a necessity. If you are feeling less than confident in your financial reporting and ability to make informed decisions, it is likely time to outsource your bookkeeping. Additionally, maintaining predictable cash flow becomes more manageable when you have a professional overseeing your books, helping you navigate financial challenges more effectively. For many small businesses, financial clarity can make or break their efforts to grow and scale. 

4. You’re stressed at tax time

Tax season can be a stressful time for any business owner, especially if your financial records are disorganized or incomplete. If you’re possibly missing out on potential tax deductions, making errors in your tax filings, or simply stressed to the max at tax time, it could be time to outsource.  By outsourcing your bookkeeping, you gain clarity and tax-ready financial reports, minimizing the risk of errors and maximizing tax savings. Proactively managing your books throughout the year ensures a smoother and more efficient tax season, alleviating stress and allowing you to focus on running your business.

Knowing when it's time to outsource your bookkeeping is essential for the success and growth of your business. By recognizing these four telltale signs, you can make an informed decision to delegate your bookkeeping responsibilities to professionals. Outsourcing your bookkeeping not only frees up your time but also provides you with valuable insights into your business's financial health, enabling you to make strategic decisions with confidence. Don't wait until you're overwhelmed or facing tax-related challenges; take proactive steps to outsource your bookkeeping and set your business up for long-term success.