Running a business and running an office are not the same thing.
You steer your business by focusing on marketing, sales, cash flow and the quality of your goods and services, along with maintaining positive customer relationships. Excelling at all of these tasks may not leave you time to keep up with your paperwork.
Liz Herrera, co-owner of Corporate Writing Assignments, puts it this way: “The time I spend looking for papers or trying to reconstruct lost figures is time I could be spending editing, writing or marketing our corporate writing and training services to potential clients.”
She adds, “It’s one thing to scramble to understand the tax code at tax time each year; it’s worse to spend the whole year ignoring your core business because you are rummaging through a disorganized office or set of books.”
You don’t have to wait until you are knee-deep in disorganization to call a bookkeeper. You can hire someone for an hour or so a week, or a few hours a month to start. This can be a bookkeeper, accountant or a finance expert.
These are four telltale signs that you need bookkeeping help now:
Your receipts are wadded up.
If you have receipts stuffed in a wallet, purse, box or drawer, you are losing control of your paperwork. A good bookkeeper, accountant of financial person handles receipts once—while recording them. After that, your receipts will reside in a well-organized file. If you find yourself handling receipts two or three times, it’s time for bookkeeping help.
You just started a business.
A new business requires all of your attention for strategy. A bookkeeper can keep your numbers up to date so that you know if your decisions are based on current sales, current cash flow and current expenses. Without a bookkeeper you may find yourself guessing about numbers and making faulty decisions.
You don’t know your profit margin.
If you have no idea how much you are making after expenses, it’s time for a bookkeeper. Many a business with robust sales has failed because the owner didn’t know that costs were rising faster than sales. A bookkeeper’s credit and debit columns will give you a clear picture of profitability in your company.
You dread data entry.
If you simply hate entering your figures and finding your totals, you’re not going to do a good job of it. It’s time for a bookkeeper if you dread bookkeeping. The task will go faster, be more accurate and most likely pay for itself if you turn it over to a professional. The time you were dreading can become the time you are growing your business.
In your quest to keep costs down, don’t look at bookkeeping as a luxury. Look at it as one of the tools you need to sharpen to build your business. If your record keeping is an afterthought, your taxes, cash flow and profitability will be cracked parts of your foundation. You can’t build on estimated numbers. The IRS won’t accept them, the bank won’t accept them, and your wallet can’t fill with imaginary dollars.
The time to hire a bookkeeper is before you get behind in your record keeping, not while you are wondering where your money went.
This article has been edited and condensed.
Brian Clay is a Utah-based freelance writer focused on web design and content marketing.
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