Achieving modern day success in your outsourced accounting and bookkeeping company
The outsourced accounting and bookkeeping profession has struggled in recent years, with the Bureau of Labor Statistics projecting a 3% decline over the next decade. What does this mean for your business? Whether you are a company centered on bookkeeping or offer it in addition to other services, finding strategies to scale your business will be critical in the next few years.
Building a scalable business requires you to focus more on productizing your services, so your clients are hiring what your company delivers and not you. Michael Gerber, founder of EMyth, supports this ideology, explaining that successful business owners need to work on their business, not in it.
At Basis 365, we’ve spent the last decade developing business models. We believe that the key to attaining business scalability is to build a fractional team, leverage outsourcing capabilities, develop consistent procedures, and create transparency within your operations.
Build a fractional team
Employee turnover is an issue plaguing the outsourced accounting and bookkeeping profession, meaning no employee is guaranteed to stay at your business. If you only have one or two people working on a customer’s accounting, you have a higher risk of continuity issues when an employee leaves. Not only does this create challenges internally when trying to quickly bring in a new team member; it creates a higher probability that your client will notice a drop in service—or even worse, the introduction of new errors. Building a fractional team focuses on finding talent that fits a specific role in the accounting function.
In our own business, we have built a team of four: controller, accounting manager, accountant, and bookkeeper. Each role performs specific tasks for their level of experience. However, these roles often overlap, allowing another team member to easily step in and complete the duties when someone is out. Take a look at your current team structure. Have you built a fractional team?
Leverage outsourcing capabilities
The Great Resignation impacts all businesses, regardless of size. Employees are leaving in record numbers, with an estimate of nearly 70 million employees quitting their job at some point in 2021. This staggering statistic means your business may be among the countless others affected by employee turnover. What’s the solution? Simply put, globalize.
It’s a small world. The concept of outsourcing is not a new trend in the business world. In fact, ties to outsourcing can be traced back to the 1970s when manufacturers found cheaper production costs and labor supplies. In order to keep our prices cost effective for our customers, we have developed our own offshore team. Primary points of customer contact are U.S.-based, while the day-to-day task-based work is offshore. Time zones can be challenging for complex issues, but the offshore team’s ability to work done while we’re sleeping is a huge advantage.
As a business owner, you have the freedom to choose which tasks get outsourced. For example, high levels of data entry can quickly be sent to a team overseas, allowing your staff to focus on other value-added tasks, such as reviewing financial statements or consulting with clients. Our blended model of onshore and offshore helped our business immensely when our U.S.-team was impacted by the Great Resignation, while some of our peers didn’t make it to 2022.
Develop consistent procedures
Procedures promote success. All organizations have procedures intertwined in every aspect of business, from HR policies down to rules for dealing with clients. Consistent procedures not only reduce confusion throughout your team, but it also allows new employees or fill-in team members to easily pick up on the items that need to be completed.
Your team needs to be able to plug and play. The more bespoke your offering is to your clients, the harder it will be for someone to jump in and cover when someone steps out. Sure, you’ll need to customize your offerings a bit to integrate with your customer’s requirements, but don’t let it get out of hand. Document what you do. We use Tettra (knowledge base) and Loom (quick explainer videos) together for that.
Consistent procedures boost employee productivity, leading to higher profit margins. Scaling your bookkeeping business through a consistent set of procedures also ensures an exit strategy. When your business has built up a guide for future employees, generations, or business owners to follow, you will have added ease exiting the business. Effectively planning your exit strategy starts well before you are ready to retire or sell.
Create transparency in your operations
Transparency in your operations will also help your business. Developing transparency isn’t just outlining required procedures. In fact, operational transparency is founded on implementing beneficial tools to help you effectively manage your customers.
Managing multiple customers isn’t an easy challenge. We use Karbon as our hub for every customer, as well as tasks needed to run our own business. Everything that needs to happen is in there. We reference our Karbon tasks to Tettra for detailed task steps.
Karbon allows everyone on the team to see what others are working on, even if an email was not sent directly to them or a task was not assigned to them. This is important if someone is covering for a team member or management is reviewing the progress of a project. This is especially important if you do develop the fractional team approach noted above. Team collaboration is critical to an efficient workflow.
Finding the right tools to give your team transparency requires due diligence and research. Don’t be warned off by the costs of this type of application. You are investing in your business’s ability to deliver at scale.
What’s next for your firm?
Hopefully, what we’ve discovered over a decade are helpful to you and your team. We’re all looking for the best way to deliver a great value to our customers that provides a consistent product at scale. Keeping your business agile and always looking for ways to improve will help ensure you’re moving in the right direction.