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  • ashly42

Managing Your Company's Finances: Should You Hire a Full-Time Employee or Outsource?

Updated: Oct 15, 2019

The most surprising thing happened when I made my first hire…

When I started my own practice, I was hesitant. Was it going to work? Would I be able to pick up clients? Could I be profitable? What would my expenses be? How much would I charge? So many questions came to mind and still do, daily. As I started to pick up new clients, I felt confident that my new venture would be worthwhile. As my book of business grew, my 40-hour work week was filled with client-related to-dos, leaving the weekends with all my CEO and admin duties. If I or one of my boys got sick, there was no wiggle room for down-time. Deadlines had to be met regardless of my or my family’s health and I did what I needed to to provide good service to my clients. It was tough. I decided I needed to hire someone to bring capacity to my solopreneurship. I did just that. I brought in a bookkeeper to help with ongoing bookkeeping and administrative tasks. I thought, “now I’ll be able to grow faster.” We did gain capacity and now if I have a sick child at home, I know that someone is working on the business and we’re still moving even if I’m not sitting at my computer.

But what I didn’t plan for was the increase in quality of the services we were providing. What does that mean?

Hiring a bookkeeper that could take on 60% of the client work that I was doing allowed me to take a step back and spend a portion of my time reviewing her work. That means that I was able to catch mistakes that I may have otherwise missed. I can talk through issues with her and she can provide valuable feedback that I can use to make decisions. I can now spend time doing work that I enjoy like budgeting, financial statement review, business and process development. We can provide more value to our clients. We can provide a higher quality service.

This got me thinking, you see many companies outsource their accounting and bookkeeping until…they have enough work to hire a person in-house. Well this makes sense, right? No! The person that you want to hire basically needs to be a jack of all “accounting” trades. You need an AP clerk, a payroll specialist, a staff accountant, a controller, and a CFO all in one person. So basically, you’ll have to compromise…do you want to hire a CFO at a staff accountant’s salary? Do you want to hire an AP clerk at a controller’s salary and do you want your CFO to pay the bills and then perform high-level analytics and your budget in his/her spare time. So many pieces to a puzzle that are very difficult to piece together in one FTE. So unless you’re ready to hire and build an entire accounting department in-house, outsource these functions for now. You’ll be happy you did.

We’d love to talk to you about how we can support you at L.A. Financial Management! Learn more about our services here.

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