It’s Monday morning and before you even have time to drink a full cup of coffee you receive the news that your in-house bookkeeper put in her two weeks’ notice. This news threatens to ruin your whole day (your whole week!) because she’s only been with you 4 months. The bookkeeper before her lasted 6 months. In fact, you’ve gone through 3 bookkeepers in the last 2 years. UGH! The time and money investment it takes to find, interview, rehire, retrain, and then do it all over again in a few months is frustrating to say the least. And expensive…
“Thirty-three percent of U.S. hiring managers anticipate employee turnover at their company to increase in the next year, costing an average of $36,295 (e.g., cost to rehire, lost productivity) annually.” The Harris Poll via PR Newswire
I have news that will turn that Monday-morning, grumpy-cat frown upside down: you have many options when it comes to securing a great bookkeeper that will eliminate your turnover problem.
Consider a construction company who builds homes for a living. It’s rare to have a small team on a construction site. The company hires a framing carpenter, a cement mason, a plumber, an electrician, an HVAC technician, a drywaller, a finish carpenter… Each person is highly skilled for their specific task. Because of that, they provide high quality work and are hired for a short period of time. They come in, do their work, then they’re done. For businesses that make under $10 million in annual revenue, you can approach hiring for your financial team in the same way.
As a Fractional CFO, you can hire me to serve as the Project Estimator for your construction site… er, business. I can take a close look at your business goals, plans, and financial records to determine exactly who you need on your accounting team, the type of position they should hold, and what your budget is for hiring them. Instead of getting stuck in the repetitive Monday-morning, grumpy-cat bad news cycle, it’s time to consider part-time, contractor, or project-based financial expertise. I’m happy to offer you a free 30-minute consultation to do a brief assessment of your financial team needs. Contact me today to get something on the calendar.
Can I Have an Employee Do Bookkeeping in Their Down Time?
Your bookkeeper’s job may seem straightforward, but there are often many layers to doing the job well.
Your bookkeeper’s regular tasks include sending out invoices to customers, posting payments received, recording invoices from your vendors, and printing vendor payments. They should also follow a process to close the books each month (bank and credit card reconciliations, for example), which includes tasks that don’t automatically get picked up in the weekly responsibilities. You want good information in your books and a well-trained, knowledgeable bookkeeper is needed for this to happen.
I see many business owners try to put multiple job roles onto one person, which can be problematic if one of those is bookkeeping. If you have a wonderful receptionist who works at the front desk, you may be tempted to also task them with doing bookkeeper responsibilities in their down time. This is a big mistake! While I’m sure your receptionist is lovely and represents your company well behind the front desk, he’s not a leaping unicorn. That’s what I like to call a person who can do it all (and then some). Just like unicorns, such a person doesn’t exist no matter how well someone sells themselves in an interview.
In fact, you may need a bookkeeper for the routine financial tasks, a Controller for more complicated financial tasks, and a CFO for financial strategy advising. You can learn more about the differences between each of these roles in my article, “From Mini-Golf to Golf-Pro: Expert Advice on Hiring a Bookkeeper, Controller, and CFO.”
Hiring for Financial Success: Tips for Small Business Owners
So how do you know if you need someone in-house or if an outsourced financial expert will be better? Here are a few tips and considerations to help guide you in building your financial team.
Hiring Internally
If your business has a complex way of generating invoices or vendor bill payments, hiring someone internally to join your team makes sense because you can train them on your exact procedures. But this is likely not a full-time role. As I mentioned above, adding bookkeeping to an existing receptionist role doesn’t work well because they aren’t trained for it. HOWEVER, you can consider hiring in the opposite direction: You could hire a trained bookkeeper who doesn’t mind also answering phones and completing office manager type tasks. This way, you get the critical skills for bookkeeping, and they can do office tasks secondarily.
You should also consider the quantity and complexity of transactions each month. Business owners tend to significantly underestimate the volume of transactions they have. What may seem like 50-100 transactions might be closer to 200-300 transactions per month. Whether you hire a part-time or contractual bookkeeper, you’ll need to have an accurate assessment of the volume to know how many hours per week you’ll need someone to conduct these bookkeeping tasks. A Fractional CFO can help you correctly assess this information.
Outsourcing Your Hire
You don’t want a bookkeeper to step into a Controller or CFO role as they won’t be qualified to do the work successfully. A good bookkeeper can reconcile bank accounts and credit card accounts, but beyond that they don’t usually have the skillset to reconcile the rest of the balance sheet and close the books monthly. Outsourcing is a great way to ensure you are getting someone who has the right experience and is well-trained to complete the tasks you need.
Going back to the story of a construction site for a new home build, it’s easier to hire individuals for specific skill levels when you outsource roles. If you hire a bookkeeper internally, you may still need to hire externally for more complex tasks that a Controller can handle, or a CFO for financial strategy consultation. Outsourcing these roles is the best way to ensure that you are receiving high quality, accurate work without breaking the bank.
Another benefit of outsourcing financial roles is that you are often covered if someone goes on vacation or the specific individual at the firm decides to move on. The very best contractors have someone trained to cover for them when they are out, so that you’ll never experience a gap in the work. If you have to hire an employee who decides to leave, you have to find and retrain a new person each and every time. 😾
Want Help Building Your Financial Team’s Structure?
If you are looking for more clarity when it comes to your financial team needs, I’d love to serve as your Project Estimator and meet with you for a free 30-minute consultation. I’ll take a look at your business situation and help you identify exactly what you need, whether that is a part-time bookkeeper, contractual Controller, or Fractional CFO (or something in between).
As a Fractional CFO, I also help business owners just like you turn their grumpy-cat frown upside down by guiding you to achieve financial health without the price tag of a full-time hire. Reach out today to learn more about how we can work together to achieve your financial goals.
