Three barriers small businesses face when handling their own bookkeeping
Bookkeeping is one of those relentless tasks in your business that you’d probably prefer not to do, but it's a vital part of your business. For many people, bookkeeping takes an immense amount of time and effort. It's important to consider your strengths and weaknesses when it comes to bookkeeping.
Here are three barriers you will see when completing your own bookkeeping:
1. Mountains of paperwork
No one likes paperwork.
While you may be good at keeping all of your important documents, how do you organise them? Some business owners still use the trusty shoe box to store their receipts and important paperwork, but is this really the most efficient way?
Manage your paper levels by using a robust file management system. Depending on your preferences, a filing cabinet or electronic filing system will both work well. Use the system most suited for your business and your work habits. Just ensure you stick to it and file important paperwork away consistently and accurately.
Having positive cashflow in a small business is vital to its success. It’s extremely difficult to follow through with your obligations without cash.
Most business owners don’t have the time to collect their accounts receivable and often have no time to get their billing out on time. If this is starting to sound familiar, you must start thinking if your time could be better spent elsewhere in the business.
If you hire staff, payroll is a time-consuming task with very little margin for error. The more staff you bring on under varying functions, payroll will become more tedious and outsourcing might be necessary.
Even if you are sure you’re paying your staff correctly, there is nothing stopping staff coming back after nearly seven years to claim back pay if they feel they’re entitled to it.
You didn’t start your business to be a bookkeeper, nor do you have the time to do it. For whichever reason you started your business, you need to spend your time and effort on the things you are good at.
Some business owners may find it difficult to relinquish control of bookkeeping, especially when they enjoy knowing their business’ financial wellbeing at a moment’s notice. But if you solely focus your time and effort on your books, there is no one else there to run the business.
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