Small business owners often face a dilemma when it comes to managing payroll and accounts payable/receivable – should they hire external financial professionals or cross-train existing administrative staff? Forbes Finance Council members share insights and strategies to help make this choice. Factors to consider include complexity of financial tasks, budget constraints, scalability, and expertise. While simpler tasks like AP/AR can be handled in-house, more complex tasks like regulatory compliance and taxation management may require professional help.
For businesses experiencing rapid growth, the volume of financial transactions can quickly overwhelm in-house administrative staff. It may be more efficient to outsource to a bookkeeping service or accountant to handle the increased workload, rather than cross-training existing staff. Selecting and setting up software carefully is essential, as current software makes it easier to handle payroll and AP/AR tasks in-house. Proper training and support are necessary for admin staff handling routine tasks, while complex matters like tax planning and audits may require external financial professionals.
It is crucial to determine the core competencies needed in the business at its stage. Key support partners like outsourced finance and accounting can help a business remain agile and focused on customer, product, and market. Consider both internal and external controls, as outsourcing may be a better solution if internal staff lack the resources to separate responsibilities properly. The most cost-effective path should be pursued, whether that involves hiring outside professionals or training existing staff for financial tasks.
Assess the technical skills of the current team and consider outsourcing if they lack the capacity or necessary skills to handle AP/AR tasks. Outsourcing specialized functions can provide small businesses with access to expertise and creativity they may not have in-house, allowing them to focus on core business activities. Small business owners should also consider the customer and employee experience when deciding between hiring outside financial professionals and cross-training admin staff. Prioritizing core business activities and strategic initiatives is essential, as outsourcing financial tasks can free up time for growth and expansion.
