As a business owner, one question which we continually ask ourselves is, ‘How can I make more money?’ It’s such a broad question… How about we rephrase it to ‘How can I more efficiently use my time to maximize value?’
If you think back over your day, where you spent your time, can you say that it was effective and efficient? For example, are you a Plumber, but kept yourself chained to the office desk for the day to catch up on your bookkeeping because your BAS is due next week? Is that effective? A Plumbers’ hourly charge out rate might be $60/hr. If we multiply that by five hours of bookkeeping that was done, it has cost the business $300 in revenue. Would you believe me if I said there was a more efficient way to utilize the plumbers time? Let’s send the plumber out to site, charging $60 an hour, revenue is then $300 for the five hours. The builder engages a bookkeeper at $40 per hour, (but it takes them 2.5 hours to do what it took the plumber 5 hours to struggle through) costing the business $100. The net effect of this transaction is revenue of $200, much better than losing the plumbers time at the desk.
You may then think, ‘yep, good point, but I do my bookkeeping at night time or on the weekends’, which is a common practice in small business. However, most of the time, our weekends come and go and very rarely do we get all our items crossed off our ‘To Do’ list. We are then forced into a situation of having to do it in a hurry or at the last minute, cutting into our productive time or chargeable time.
The other downside is that, as accountants, we regularly spend time correcting ledgers simply because the person inputting the data is doing the best they can without having expertise in the field. Traditionally, this costs the business money in higher accountancy fees as time is spent correcting ledgers and sometimes, amending lodged activity statements etc.
Perhaps, whilst the initial reaction to employing or engaging a bookkeeper may seem like an unnecessary cost and sometimes maybe even a luxury, if you think about how you manage your books as a business owner, it may actually be a time saver, and as we’ve said before, time is money. A bookkeeper (considering you engage a good one) will ensure your books are up to date, can provide you with reports on a regular basis to help make financial decisions, ensure that all data is correct and ready for the accountant at the necessary time and take away the worry of another item on your ‘To Do’ list.
Another advantage which is of significant value, is your down time and your time with family. Working five or six days a week and quoting and paperwork during off-site or out of hours time can have an affect on your family and, not to mention, your sanity. Finding work/life balance is crucial in our super hectic lives. So we challenge you to consider how and where you spend your time, can it be spent more effectively, do you need to be relieved of one aspect of your business – and if you answer yes, then we can help. Whilst we are accountants, we do offer bookkeeping services at very competitive rates and would love to be a helping hand in your business. Just food for thought….