Most businesses rely on an in-house bookkeeper to handle their bookkeeping needs. Usually, this in-house bookkeeper is an office assistant who handles bookkeeping in addition to various other tasks. Having bookkeeping handled by non-specialists is error-prone and expensive especially when you can outsource bookkeeping at a fraction of the cost while dramatically improving its quality. How is that possible, you may ask?
Until recently, outsourced bookkeeping was only feasible for the largest businesses. The advent of the Internet and access to a global pool of virtual resources has made outsourcing feasible for even small businesses. Anyone anywhere with access to a computer and Internet can provide bookkeeping services.
Outsourcing enables specialization and quality improvement not just with bookkeeping but throughout the business. The quality of bookkeeping benefits from access to a rich pool of virtual bookkeepers. Quality of other processes in the business improve due to more time that is now available. As a result, outsourcing enables the business to focus on what it does best and allows the service provider to deliver what they do best. So, outsourcing improves quality by enabling specialization throughout the business.
Outsourcing offers significant cost savings. By having access to a rich pool of talented virtual bookkeepers across the globe which includes low cost countries like India, the business can cut costs from lower hourly rates and from lesser number of hours it takes the bookkeeper complete tasks.
Outsourced bookkeeping also reduces overhead. With an in-house assistant, you usually have to provide an office desk with computer and pay the assistant whether or not there is actual work. Such pay includes salary, vacation time, sick time, social security, medicare and healthcare. With an outsourced bookkeeper, you only pay for hours you use and there is no additional overhead.
Outsourcing reduces business liability in two ways. First, by letting a third party handle the books, any errors do not result in criminal prosecution as the business can easily point their fingers at the virtual bookkeeper. Second, having a specialist handle the bookkeeping drastically reduces the number of errors and associated liabilities.
The cost savings from outsourcing bookkeeping, can be used to lower end prices for customers and/or improve profit margin. This cost advantage enables the business to compete better.
As you can see, outsourcing bookkeeping offers some significant benefits. The biggest challenges are around security and quality. This is where picking a bookkeeping services provider with an extensive positive track record as opposed to getting someone off the street may help.
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