Accounting and finance operations are the foundation for any business and not just in terms of regularly kept books. They present an accurate picture of your business and provide valuable insights into what areas need improvement and which segments can lead to faster growth. This significance makes some companies unsure about outsourcing such a key area. At the same time, accounting and finance operations require a lot of resources and are cumbersome by nature. This provides a challenge for those companies that are finding it difficult to keep these functions in-house but are not completely comfortable about letting an external party take the wheel on these. So in today’s article, we will give you the top five benefits of outsourcing your accounting and finance departments to make your decision easier
Better Allocation of Resources
Irrespective of how profitable your company is, there is only so much money in your accounts. When you take departments like accounting and financing that are significant to keep the business upright but don’t directly generate revenues, you should remember that by outsourcing them you get to conserve more resources for your revenue generating departments. BPO companies do not translate your operations into less focused or ignored, rather you get the same level of importance and focus for your finance and accounting, without needing to spend so much money. Instead, you can spend your precious resources on other segments and become more efficient and profitable.
Quicker and more accurate information on your fingertips
While your in-house employees might also be excellent in their jobs, when we compare standalone company accounting departments with business process outsourcing (BPO) companies that deal with multiple companies of several sizes operating in different industries, the skill levels and technical capabilities differ significantly. Accounting and financial statements are not only meant to be prepared as a legal or functioning requirement, but they also hold valuable information about the key trends in a given market or a certain time period. The experts preparing these statements should be able to identify, interpret and communicate such trends so they can be used for better strategy making and boosting efficiency and growth. The technical capabilities and skill levels with BPO companies’ workforce are, therefore, much more suited to a company’s needs from financial statements than employees who have the experience of only a few or even only one company’s financial performance.
You get live support in difficult times
While outsourcing primarily rose in popularity due to its immense potential to save on costs, with the passage of time businesses all around the world have also realized the benefit out outsourcing during economic slowdown. Accounting and finance departments are those that cannot be shut down, no matter how bad the business activity. Therefore if you have an in-house department, you will have to continue to pay the salaries, any additional benefits, as well as all overhead expenses related to these departments. Either this or you will have to constantly hire, fire, and rehire employees according to different business cycles, which is neither advisable nor sustainable. However, if you have a BPO company on board, you can simply reduce the work requirement and slash your costs down to just the bare minimum you need to pay to fulfill your required level of operations.
Better safety and less risk of employee dissatisfaction
This one factor is not usually discussed when accounting and finance operations are under concern, but the fact of the matter remains that your employees will always want higher salaries, more benefits, and better packages overall. Now your company might be making enough money to double the salaries of all employees, but that does not fit well with the industry you are operating in. You have to remain competitive at the level of other players in the market. Inversely, your company might be going through a hard time and you probably are struggling to pay the salaries of your employees. In both cases, if your employees find out the financial situation of your company, it can lead to trouble. Either they will get disheartened on not getting more benefits, or they will start to look for work elsewhere in case your company loses its grip altogether. Therefore, keeping these sensitive financial details out of your in-house employees’ notice is the better way to operate either way. Let an external company take care of your financial and accounting operations and your employees happy on getting market competitive salaries.
Overall less stress for you
When all above-mentioned factors are considered, you see that you will not only get better quality services at lower prices with outsourcing your finance and accounting departments, but that you will also have much less reasons to worry otherwise as well. Your accounting operations and financial statements will be more legally appropriate so there is no risk of any penalties. You will have access to better technology so no delay or errors in your books. You will not have to worry about not knowing your ability to invest if a new opportunity comes up. And finally, your employee motivation will not be disturbed. All in all, it makes a lot more sense to outsource these departments for more productivity, better efficiency, and therefore higher profitability of your business.