Penny Wise Pound Foolish with Professional Bookkeeping

In Bookkeeping By mainadmin


Focusing on the little things can sometimes miss the big

Have you ever heard the term “Penny Wise, Pound Foolish”. It’s a bit of a dated English term but, in essence, it means: someone being more careful with their money with the little things than with the big – to their detriment. Put another way, by focusing too heavily on the small costs, you often miss the truly big opportunities. It might be a little bit of a stretch of the phrase, but nothing is truer these days in business than with bookkeeping.

As part of the evolution of any small business, it’s common for people to start off by doing everything themselves. As the businesses grows, however, it’s smart to start delegating smaller, repetitive jobs, so you can focus on strategy and growthing the business.

Generally due to habit or fear, small business owners often hold onto general business jobs a bit too long. By wasting valuable time on a task which can be outsourced at a reasonable price, big sales opportunities or strategic business development can be neglected – hence being penny wise but pound foolish. A prime example is bookkeeping. Bookkeeping isn’t related to your core business. Unless you’re an accounting firm, your expertise and competitive advantage lie in other products, skills or services. Bookkeeping is just a function or adjunct to the business.

In the early days, it makes sense to do bookkeeping yourself. In the beginning, you don’t have much cash flow and you’ve got to do as much as you can yourself to stay afloat. But if you’ve progressed past this early development stage, as soon as you can, you have to delegate this and other small and general business tasks so you can focus on growth and revenue generation. This is what successful business people and businesses do.

Professional Bookkeeping - Pound Wise with Build Growth Accountants

Head in The Clouds – With Xero Accounting

In the past, getting someone else to do your bookkeeping might have been difficult or expensive. Often with MYOB or Quickbooks, it was necessary to have people come onto your business premises, operate on your IT hardware and steal your time for input. Now, more than ever, however, for professional bookkeeping, you don’t have to get people come into your premises, and, better still, it can be fully automated.

Unless you’ve been living under a rock, you’ve no doubt heard about the popularity of “Cloud Computing”. That is, rather than having all your business data or documents on your own computer or network, having it in a secure location online. The benefits of cloud computing are huge. They include:

  • Improved security and backup processes
  • The ability to access data at any time from any device
  • Ease of sharing documents or data with resources not in your physical location

A great example of successful cloud computing is with bookkeeping and accounting. Cloud accounting has gained popularity because it allows constant and easy access to business financial data – again, from any device – anywhere. This allows offsite access to data for task delegation, and importantly, the ability for expert external advice on critical strategic business decisions. One of the most successful examples of Cloud Accounting is the Xero online platform.

With the Xero Cloud Accounting, you can outsource your bookkeeping to anyone, anywhere. Some benefits of the amazing features include:

  • Taking a photo of a receipt on your phone and uploading it to Xero – allowing you to then throw away the receipt
  • With a couple clicks, being able to see your monthly sales or profit for the month – on your phone, tablet or ANY device with an an internet connection.
  • Being able to do bank account reconciliations with a couple swipes at your mobile screen – with Xero being able to automatically sync with your business bank account.

Professional Bookkeeping with Benefits

If you get your bookkeeping done by someone who only does bookkeeping…you’re only going to get bookkeeping! You’ll get the admin done, and that’s great, but by not getting the bookkeeping done by someone with accounting knowledge and experience also, you’ll likely miss the big opportunity of identifying ways of making strategic financial improvements to your business. A professional bookkeeping and accounting firm might be slightly more expensive than a business that only does bookkeeping, but again with Penny Wise Pound Foolish in mind, not sweating the small pricing difference can lead to a much bigger financial return.

This is why getting an accounting firm with both bookkeeping and accounting services, maximises your chance of getting more out of the process and saving big money rather than little. In addition, if you get an accounting firm which doesn’t online cloud accounting – particularly with Xero – you’re getting the most out of the process that you possibly can.

Here Comes The Plug

A prime example of such a firm is Build Growth Accountants. Based in Melbourne, Build Growth offer a host of affordable monthly professional bookkeeping services – combined with a commitment to strategic financial outcomes which will grow your business. Build Growth’s Principal is a CPA with a long and proven commitment to building businesses. Build Growth can help with the little bookkeeping items, but more importantly can grow with you to the big items. Having build growth as your accounting partner is like having both a bookkeeper AND an outsourced CFO – so you can be BOTH Penny Wise and Pound Wise.

 

 

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