Have you heard of businesses choosing to outsource their accounting and back office processes? You may wonder what that means for the business, what the benefits are, and what the whole operation entails. Today, we’re exploring what accounting-related business process outsourcing is by answering common and frequently asked questions about this facet of running a business.
What Is Business Process Outsourcing?
Business process outsourcing simplifies your tasks as a business owner or manager by partnering with other companies who complete the essential business functions you need. For example, when a company partners with an accounting firm that can handle all of their back office management, tax planning, and business advisory services, they are utilizing a form of business process outsourcing.
There are several processes that a business can outsource, including:
- Accounting
- Back Office Management
- Customer Service
- Human Resources
- IT Support and Management
- Marketing
- Sales
- Supply Chain Management
While some companies may choose to outsource just their accounting and back-office management functions to a company that can handle both, others may opt to outsource most, if not all, of their front- and back-office processes so they can focus on the core of their business.
Why Choose Business Process Outsourcing for Your Accounting and Back Office Management?
Businesses often pursue business process outsourcing when they realize the cost benefits. It is expensive to pay an employee or a department of employees a full-time salary plus benefits and bonuses to complete accounting duties. If a skilled accounting firm can provide the same level of work as an employee or team of employees for a fraction of the cost, choosing to outsource the work can be financially beneficial.
How Does Business Process Outsourcing Work?
When a business determines that outsourcing certain processes like back-office management would be a wise financial and functional decision, it will begin by researching available companies to partner with.
Some qualities to look for when searching for the right team to utilize:
- The company or firm provides the services you require.
- The company is local or regional, which is especially important when it comes to your taxes, accounting services, and back office management.
- The company has years of experience serving other companies like yours.
- The company offers additional, beneficial capabilities to help your business grow, such as business advisory services.
After exploring all your options, you’ll choose whichever company you would like to partner with. Outsourced accounting companies rarely provide one-size-fits-all services since no two businesses are alike. In the initial phase, your accounting company will create a tailor-made solution based on your specifics to ensure that your services entail the exact solutions your company needs.
Once the partnership is established and the contracts are signed, your new accountant will begin providing the agreed services, relieving you from worrying about those tasks and duties.
What Kind of Companies Can Benefit From Business Process Outsourcing for Their Accounting and Back Office Management?
Any company can benefit from some form of accounting-related business process outsourcing. Reasons a business might want to use an outsourced accountant include:
- Accounting and Bookkeeping – All businesses, no matter how big or small, have to manage their accounting and bookkeeping on a routine basis. It can be a lot to juggle on top of core business processes, so outsourcing your accounting services to a trusted CPA can be a highly beneficial and viable option.
- Payroll – If you have employees to pay but don’t want to deal with the payroll process week after week, payroll outsourcing could be your solution.
- Tax Planning and Prep – All businesses must deal with tax planning and tax preparation, not just once a year but throughout the year. You could hire an in-house tax professional or get the same benefits for a fraction of the cost by outsourcing your tax processes to a skilled accounting team.
What Are the Benefits of Business Process Outsourcing for Your Accounting Needs?
Several benefits come from pursuing business process outsourcing for your company, such as:
- Cost Effectiveness – Cost is a huge benefit to business process outsourcing. Let’s say you have a back-office department with three employees. Let’s also say each employee receives a salary of $50,000. That’s $150,000 annually plus benefits, bonuses, and overhead costs. With business process outsourcing, you can see massive savings and achieve the same quality of work as you would from your in-house department.
- Specialized Skills and Expertise – The professionals who work at BPOs are specialists in their industry. You or a team member could try to perform accounting and back-office management. Still, you may not have the experience or detailed knowledge to complete the necessary tasks correctly. By partnering with an accounting BPO, you don’t have to worry about learning the ins and outs of accounting—your partnering team already knows it!
- Advanced Technology – No matter which services you outsource, your team will have access to various advanced tools and technologies to complete your tasks and duties. You don’t have to worry about curating the tools required to get the job done.
- Risk Management and Mitigation—when it comes to taxes, accounting, bookkeeping, and payroll, there are a thousand and one ways to err. One miscalculation or misstep could land your business in extremely hot water on a state or federal level. Outsourcing to the experts significantly lowers the risk of making a tax or accounting mistake.
If you want to outsource your accounting, back-office, or tax processes to the experts, talk to ClaytonCarter.
Cristen Carter is a CPA and business advisor with over 30 years of experience serving clients in Georgia. Her firm offers outsourced accounting services and beneficial business advisory services that improve your decision-making for your company. Let Cristen and her team monitor your finances and provide valuable insight to help make improvements or rethink processes. Contact our team today to change how you do accounting at your business! (478) 621-4145
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