Are your bookkeeping practices hindering your company’s growth? Many smaller businesses start out doing their own bookkeeping. But the reality is that as a company expands, its accounts payable, accounts receivable, and payroll requirements tend to become more complex. Whether you’re in the business of making money, or you lead a non-profit organization, good record-keeping practices are essential for continued success.
Better Organization, Better Business Development
Organized bookkeeping records play a key role in promoting data-driven decisions that will positively impact your business. According to the Government of Canada, the more organized your records are, the more you’ll get from them in terms of:
- tracking and comparing your company’s past and present financial positions,
- complying with the CRA’s reporting obligations,
- saving time and headaches should your business be audited, and
- planning and forecasting your financial standing in the future
Too many organizations wait until their accounting responsibilities overwhelm them before they decide to take action. By then, however, their bookkeeping’s usually displaying all the signs of a system that’s gotten out of control.
These signs may include:
- sometimes - or always - paying bills late,
- neglecting to collect customer payments on a regular basis,
- books that won’t balance,
- bank accounts and credit card statements that aren’t getting reconciled, and
- confusion around which employee deductions to make, or whether or not government remittances are being filed and paid on time
If you’re concerned about falling behind with your bookkeeping - but are still on the fence about asking for help – consider these 3 fundamental ways your current bookkeeping habits could be getting in the way of your growth.
1. Difficulty Expanding Your Customer Base
Customers are the lifeblood of every organization, and expanding your customer base has the potential to increase your profits and enrich your reputation. But when you’re forced to devote too much time to your bookkeeping, it can be difficult to focus on attracting new clients to your business and keeping existing customers happy.
Digital marketing is the preferred way for many organizations to stay relevant, engage with their target audience, and effectively promote what they do. But while the vast majority of Canadian marketing executives believe platforms like social media contribute to their success, it’s not uncommon for the average small business owner to have to dedicate some 20 hours a week to reap the benefits of various digital marketing channels.
If you’re a company with limited resources, finding the time and energy to drum up new business - while also focusing on better understanding your existing clientele - can be an ongoing challenge. Freeing up even a few extra hours a week by outsourcing your bookkeeping may be just what your organization needs to help grow its marketing efforts.
2. Struggling to Keep Your Business Proactive
Does your business spend more time putting out fires than it does making progress toward critical goals? It’s not uncommon for organizations to get stuck in reactive mode when they should be giving their attention to pursuits like professional development, taking advantage of technological advancements, and staying at least one step ahead of the competition.
Having a reasonable understanding of your company’s financial situation, both today and tomorrow, contributes to more proactive planning – especially when it comes to:
- responding to market changes and evolving customer expectations,
- side-stepping potential budgeting problems, and
- training personnel and implementing systems that allow your business to grow more efficiently
Getting support from a bookkeeping expert will not only keep your accounting on track, it will also position you to take practical steps that can help keep your business moving forward.
3. Failing to Take Advantage of Fresh Opportunities
Spending too much time with your head in your books – or worse, allowing your accounts to get out of control – can prevent you from planning and implementing key growth initiatives. Whether your aim is product development, business acquisition, or – as it is for many Canadian NPOs – an improved ability to hire and retain skilled employees, many businesses struggle to find the time and access the right financial tools to engage in effective strategic planning.
Seeking out and benefitting from fresh opportunities isn’t possible without real-time knowledge of how your business is faring financially. And the only way to acquire that knowledge is with the help of organized bookkeeping records and accurate financial reports.
Outsourcing your bookkeeping to a qualified professional is one of the best ways to stay on top of your numbers and keep business activities in line with company goals. So make a plan to seek help before you get bogged down by the kind of accounting dilemmas that lead to business paralysis. Not only can falling behind in your bookkeeping lead to unnecessary stress – especially come tax time - it can increase your risk of missing out on pivotal growth opportunities.
At Enkel, we specialize in bookkeeping, payroll and more back office services for non-profit organizations and small and medium businesses. Whether your organization is located in Vancouver, Edmonton, Calgary, or Toronto, we've got your bookkeeping needs covered! Contact us today to learn more.