Offering bookkeeping services to small businesses

If you’re starting up a new business offering bookkeeping as a service, you need to come to grips with the range of bookkeeping offerings you can provide, and how to go about filling the needs of your clients.

Businesses of all sizes across every industry are potential bookkeeping clients. While each of your clients will have specific needs, there will also be significant cross-over in terms of common requirements. For example, probably all your clients will be seeking to grow.

So now, it’s over to you to create a bookkeeping services business that fits both your desired style of working and the needs of your potential customers.

What services do bookkeepers provide?

First things first, what bookkeeping services do you want to offer?

While a well-rounded suite of offerings is no doubt advantageous, it can also pay to focus on the needs of specific industries or bookkeeping tasks. Let’s take a wide view of your basic choices.

1.      Invoicing

Sending and managing invoicing processes and chasing accounts receivable (unpaid invoices) are major pain points for service-based businesses. By focusing on invoicing as a bookkeeper, you may find a highly motivated customer base who want to enlist a professional to attend to all such matters.

2.      Bank reconciliation (reconciling financial statements and bank statements)

Bank reconciliation is a cornerstone of bookkeeping. Ensuring that your client’s reported income and expenses are reflected perfectly in their actual bank accounts lies at the heart of sound financial management and compliance.

3.      Cash flow analysis

Cash flow is often touted as one of, if not the most, crucial concerns of small businesses. If a business has done work that’s unpaid or bought stock yet to yield revenue, it may have serious cash flow issues.

Until a business has adequate cash on hand, they run the risk of being unable to pay necessities like overheads and wages. This puts strain on available finances. Providing cash flow reports and cash flow analysis are crucial and attractive bookkeeping services.

4.      Budget analysis

Many business owners fail or underperform, not because they weren’t viable, but because they didn’t budget properly.

There are a lot of businesses out there that spend impulsively without properly constructing and following a budget. Offering budgeting advice can be a lucrative and useful bookkeeping service.

5.      Monthly reports

When business owners are so focused on day-to-day operations, monthly reporting and analysis often fall by the wayside. In many cases, they may not have the skills or time to undertake professional financial reporting.

This means they can be flying blind and unaware of threats or opportunities to run a more stable and profitable venture ready for growth. Managing a client’s reporting process, combined with sage analysis and advice, is a standard bookkeeping offering.

6.      Balance sheet

Another mainstay of bookkeeping is producing balance sheets. A balance sheet shows all liabilities and assets for a given time. As such, producing balance sheets is a basic yet crucial service that underpins the role of a bookkeeper.

7.      Profit and loss

A profit and loss statement (P&L) is another primary financial report which depicts a business’s profit and loss for a given time. Creating and understanding a P&L is crucial for compliance, growth, and sound financial management.

8.      Accounts payable

Accounts payable is a ledger of unpaid invoices or debts. These liabilities can impinge on a business’s ability to free up cash for other vital areas. Being able to report and consult upon accounts payable is elemental to a well-run business.

9.      Accounts receivable

Similarly, accounts receivable is a ledger of those who owe a business money, usually through unpaid invoices. A high accounts receivable ledger indicates underwhelming invoicing and debt collection practices and represents one of the biggest problems many businesses face.

Accounts receivable dovetails directly into cashflow concerns, as a business may have revenue as an asset on their books but can’t utilise it.

10.  Data entry

The once fundamental task of data entry has now largely been superseded by software automation. Nevertheless, an understanding of the theory and practice of data entry is essential to bookkeeping.

11.  Payroll

Any business that has employees on the payroll needs to abide by strict practices. Maintaining payroll compliance and understanding concepts like Single Touch Payroll (STP) are key to being an employer. That’s where a bookkeeper can step in. Services can include:

• employee records
• calculating payment and deductions
• creation of payslips & making payments
• assisting with ATO reporting
• super requirements
• award rates
• Single Touch Payroll (STP).

Setting up and advising on business systems (accounting software)

Many bookkeeping duties can technically be undertaken by a motivated business owner using capable accounting software.

Indeed, nowadays, many business owners make use of accounting or bookkeeping tools. But the barriers they face using them represent opportunities for bookkeepers.

Many businesses don’t know how to make the most of their accounting systems, and many more don’t have time. Others don’t trust their ability to perform certain tasks or will seek professional management and understanding in areas that lie outside their comfort zone.

Services you can provide:

1) Accounting software training and guidance.

2) Filling the gaps by accessing their software to professionally perform tasks and deliver advice.

Identify the industries (or clients) you want to work with

This is key. Being able to offer niche services for certain industries can set you apart from other bookkeeping businesses. One way to set yourself apart is to concentrate on a few of the above areas.

However, many business owners will seek out professionals that know their industry space, so it might pay to target your services. Think about:

• Sole traders.
• Non-profit businesses.
• Farming and agriculture.
• Professional services (eg. lawyers, architects, real estate agents).
• Retail.
• Hospitality.
• eCommerce.
• Start-ups.
• Medical and healthcare.