Your e-commerce business made it through the year (congrats!), and now you’re ready to outsource your accounting. There are a few ways to do this, and in this post we’ll focus on three of them: a virtual assistant (VA), a full-time employee, and an accounting firm.
But how do you know which is the right option for your business? Tyler breaks them down in the video below.
A VA is a great option for smaller businesses who aren’t ready to hire a full-time employee. VAs are the cheapest option of those discussed here, since most VAs don’t work full time, many are located outside of the United States, and none of them require a full salary and benefits.
The potential downsides of hiring a VA for your accounting needs come from lack of experience and some necessary hand-holding. Most VAs, unless hired out by a specialized firm, won’t have any accounting experience and will need to be taught your system from scratch. This also poses an issue if you yourself don’t already have a solid accounting system in place or if your current system is something you couldn’t easily and accurately teach to someone else. Since you would be the one your VA comes to with any questions about the accounting, it’s important that you have a foundational knowledge of your books before hiring a VA.
Employees are another way to go when outsourcing your accounting, and they, too, come with pros and cons. Before even considering hiring an employee, you may consider whether you are near a metropolitan area where the talent pool for this type of employee will be big enough to be worth casting a net. The exception to this would be for companies who are comfortable hiring remote employees, which may pose a different set of obstacles.
One of the major positives to hiring an employee is dedication. If your employee works full time for your company, they are loyal to your business, and you can conduct your own quality assurance in real time. Employees come already equipped with their own accounting knowledge, and as long as you make it clear in your job description, you can also recruit them to take on other non-accounting responsibilities. Hiring an employee is a great option for business owners who know they need someone with a higher level of accounting knowledge to take on their books but who also like to have control over the accounting process.
In contrast to a VA, however, employees require a regular full-time salary, and along with that comes a full-time workload. If your business doesn’t have 35 hours a week worth of accounting work to be done, it may be hard to justify the expense of an in-house employee. Additionally, if your accounting is especially complicated, hiring an accountant with the specific knowledge required for the job will be more expensive than one with less experience.
We at Seller Accountant may be a little biased towards this choice, but if a VA or an employee don’t seem like a good fit, there are a few criteria that may help you decide to reach out to an outsourced accounting firm.
- Time – You don’t have time to do your own accounting. It takes up too many hours in your already busy week, and you’d rather spend that time being the CEO of your company.
- Knowledge – You don’t have an accounting background or numbers are not your thing. An understand of your accounting system and management of your books is out of your wheelhouse, and you wouldn’t feel comfortable trying to explain it to a VA or an employee.
- Complexity – Your accounting needs a specific knowledge base to be done correctly. If you’re reading this, you’re probably an e-commerce seller, and you know that your accounting is more complicated than most.
- Part-time Needs – You don’t have enough work to justify a full-time employee, you can’t afford to pay a full-time employee, or both.
If all of the above are true, it may be time to outsource to an accounting firm. Firms are less expensive than an employee because they don’t require a salary or benefits, and it is possible to find a firm that fits your specific accounting needs.
Conversely, you may have less control over your accounting timeline with a firm, since you will not be their only priority. Most firms do their best to accommodate their clients’ needs and are happy to work together to deliver a desired result.