Survey: Hiring Outside Bookkeping Services, how much is fair?

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Outsourcing is cost effective.

Employing a bookkeeper in-house can be expensive. That cost is not just comprised of salary, but the other direct costs such as employer payroll taxes, workers compensation, medical insurance, retirement plans and other benefits. Additionally, there are employee vacation and sick days to consider as well. There are also the savings in both the time and money involved to place classified ads, interview, screen, test and train an employee.

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Outsource Your Bookkeeping To Get The Competitive Advantage

As a significant tool to improve organization's bottom line, Outsourcing makes a business enterprise more competitive in today-s market-place by making it more responsive to changes in technology, improve quality of offerings and import desired skill-sets into the organization. Outsourcing has thus become the most preferred way for many Fortune 500 companies to cut costs and expand their business. Strategically giants like Ford and Procter & Gamble have outsourced entire line of their business while others like Honeywell and Hewlett-Packard outsource only the key elements of supply chain. And with advancement of technology, this trend of outsourcing key business processes like bookkeeping are gaining ground across businesses and even small sized businesses are opting for it.

Outsourcing bookkeeping brings many advantages to businesses. Estimates place the savings that derive to a company by outsourcing its bookkeeping can be as high as 50%. Apart from these financial advantages, there are other strategic benefits which accrue to company thus giving it a definite competitive advantage. The following points explore the benefits derived by outsourcing bookkeeping:

1) Maintain cost competitiveness: Hiring full-time staff involves providing them with company benefits and training which is costly and time-consuming affair. Furthermore, recruiting costs and overheads associated are additional. Outsourcing firms lower the bookkeeping costs by offering companies with a cheaper alternative. Companies saving significantly by outsourcing can thus reduce their cost of operation.

2) Elimination of fixed overheads: Once a company takes to outsourcing of bookkeeping, it can do away with fixed overheads of employer payroll taxes, medical benefits, retirement plans and other benefits. The advantage associated with elimination of fixed overheads is the flexibility and nimbleness that derives to a company to make swift changes

3) Plug-In for Temporary Assignments: Temporary accounting assignment can often create exceptional overload thereby affecting the efficiency of a staff. Outsourcing of bookkeeping assignments helps in improving the quality without in any way retarding the efficiency of the bookkeeping process

4) Focus on core business: For small business owners who are already tight on time, outsourcing of bookkeeping service bring the gift of time which can be allocated in building client relationship and capacity building that are incidental to the growth of their business. On the basis of such improvements, a business can acquire distinct advantage over its competitor.

5) Innovation, Research and Development: A firm outsourcing its bookkeeping can save exponentially. Estimates point that replacing an in-house accountant in the US, with an outsourced one saves a company approximately around $50,000 annually. Such savings can be reinvested successfully in conducting research and development and product innovations. These are necessary to maintain the competitive advantage in market replete with cut-throat competition.

Outsourcing bookkeeping provides a business with a chance to instantly tap in a pool of skilled professionals to support the accounting process. It instantly provides a competitive advantage by providing a cost saving of at least 50%.As mentioned earlier, most successful Multi National Companies of today have been outsourcing for some time now and have the time and money to spend on differentiating themselves in the highly competitive marketplace. It can thus be safely concluded that outsourcing bookkeeping gives definite competitive advantage to companies.

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