Is outsourcing right for you? It pays to know what you’re signing up for before you get started
Before you decide to outsource some of your accounting or bookkeeping functions, it’s worth checking out the benefits–and the drawbacks–to understand whether outsourcing is the right option for your accounting business.
Competitive advantages of outsourcing for accountants
- By delegating tasks to external agencies, you can focus on specific business outcomes, giving yourself huge advantages over other firms.
- You’re taking advantage of better revenue, with lower costs and bigger ROI.
- Alongside the lower costs, there are economies of scale and increased efficiencies, offering you the opportunity for growth.
- Access to a bigger pool of professionals means increased speed of delivery – providing solutions to more customers, faster.
- Specialization of staff means you’ll have more in-depth knowledge and consistently delivery high-level service.
- A bigger knowledge base allows for innovation and ideas.
- You can refocus your business, improve your core competencies, and spend time on the important things.
- Free up management time to work on company growth, not managing aspects of production.
- Reduced cash outflow and optimal utilization of resources.
- Better controlled costs, with guaranteed costs each month.
- Access to facilities and capabilities you could not access or afford otherwise.
- More agile and flexible, adapting easily to market changes.
- Access to pools of highly qualified talent that you may not be able to find or afford locally (one of the biggest challenges for accounting firms).
- Develop a more engaged team by having the right people on the right work, or more simply focusing their time on work they were trained for and enjoy more.
- Through capacity and performance, achieve considerable improvements in client satisfaction and retention.
- Provide new types or work and opportunities for your onshore team, i.e. onshore champion or team manager of the offshore team.
- Growth, providing a more stable and successful company that has a more positive impact for your local and offshore employees.
- Improve your team’s soft skills, working with an offshore team drives considerable improvements across communication, management, leadership and a number of key attributes that will ultimately help your firm perform better.
Potential drawbacks of outsourcing for accountants
- Service delivery may not meet expectations until you find a trustworthy outsourcing agent.
- Less control over confidentiality and intellectual property information.
- Some contracts are rigid and do not allow flexibility.
- Lack of control over management/ business operations.
- Ethical worries about exploiting people, often in a developing country.
- Potential time zone and language barriers.
- If existing staff in the country of origin need to be laid off, this can be very destructive to the business.
A good outsourcing company manages the risks well
Finding a professional and specialist outsourcing company goes a long way to negating the risks and pitfalls. A stable outsourcing company that you can trust, alongside the use of a robust contract, means that most of the risks are minimized, and all of the benefits are realized.
Finding the best outsourcing company is key to a healthy and productive relationship for both businesses – but once that’s done, the benefit to your business bottom line is huge. If you’d like to know more, take a closer look at reasons to outsource or read the ultimate guide on outsourcing and what it means for your accounting practice.
Learn more about outsourcing your accounting by talking to our consultants today.