If you think outsourcing is out of the big picture, think again. The reality is, finance and accounting outsourcing remains buoyant, especially since the US is currently swimming against the tides of The Great Resignation.
According to a recent survey, 71% of finance executives outsource their functions.
Along with IT services, accounting is among the areas where outsourcing is rampant. This is because tasks involving them require certain skills and the proficiency that some companies do not have internally. 37% of accounting and IT-related work gets outsourced.
Globally, the finance outsourcing market is valued at over $130 billion. Clutch reported that in 2021, 23% of businesses planned to outsource their finance processes rooting from different motivations and circumstances. Banks and financial institutions becoming more dependent on external parties for their finance functions is leading to this amplification of outsourced services since the pandemic came in.
And because of their growing relevance in today's labor arena, it is projected that they will have a consistent increase through the years with a 7.5% growth annually.
The above data tells us that an increasing rate of entrepreneurs is turning to outsourcing for the effective management of their business finances. In fact, your competitors just might be dipping a toe into outsourcing at this very moment.
If your competitors are joining the outsourcing bandwagon, they might outpace you sooner than you think. Can you afford to lag behind? If you plan to stay in the competition, more likely you won't let that happen. Read on to find out what are the benefits of outsourcing and the pertinent advantages it can bring to your business.
Time efficiencyDeciding to outsource your accounting and bookkeeping operations gives you more time to focus on your company instead of fretting over your critical business numbers. Besides, don’t you think shifting tasks - from crunching the numbers to keeping an eye on your inventory and expanding your client network – is a little too distracting? Outsourcing gives you the opportunity to spend time wisely.
Cost reductionAmong other things, remote accounting services can help you save costs. Running a business doesn’t come cheap. But you have the option to cut down on overhead costs and employees’ wages through outsourcing. After all, the rate of an outsourced accountant is significantly cheaper than hiring your very own bean counter.
Experience and expertiseAn outsourced accounting staff has the skills and expertise that can put your business at a definite advantage. Since these professionals typically deal with other clients from different verticals, you have the guarantee that they are fully capable of maintaining your books and interpreting your financial data seamlessly.
Focusing on more important tasksIf your accounting tasks are too complex but you are hesitant to outsource, the tendency is that you end up asking your other employees to help you sort your books. If they are not familiar with bookkeeping tasks, helping you update your books may distract them from their own duties and responsibilities. But if you switch to outsourcing, your employees can focus more on their own tasks.
Access to modern toolsSmall business accounting outsourcing opens doors to modern tools such as cloud technology. By outsourcing your finance and accounting services, you can explore cloud accounting more thoroughly and find out which cloud accounting tool best suits your business. If built-in timesheets and inventories are important for your business, you can take a look at QuickBooks Online. In case you need multiple users with different permission levels, Xero might be a better option for you.
Finance and accounting outsourcing services can do wonders for your business. It doesn’t just help you save costs, it also gives your company its much-needed flexibility in this special circumstance that is the post-pandemic period.
Are you eager to experience what outsourcing can do for your business? Don’t plunge into it just yet. For more information about outsourcing finance and accounting services, you can download our whitepaper Outsourcing: How to Make it Work or contact us so we can schedule a free consultation.
This post was first published 28 August 2014 and edited 28 January 2022.
Edited by: Maria Katrina dela Cruz