Growing an Accounting Firm Amidst Staffing Shortages: Strategies for Success Through Outsourcing Bookkeeping Services

A recent Bloomberg analysis, using data from the U.S. Bureau of Labor Statistics, reveals a reduction in the number of accountants by 340,000 accountants over the past five years. This decline brings the current number of accountants and auditors employed in the U.S. to around 1.6 million. The struggle with staffing issues in accounting firms is real. The shortage of qualified staff is a big problem for small and medium-sized practices. But in the midst of all this is an opportunity: outsourced bookkeeping. This solution addresses staffing pressures and opens up growth and better client service.

The State of Staffing Shortages in Accounting

Accounting is in the midst of a labor shortage crisis. A perfect storm of factors is causing this:

• Retirements of experienced staff
• Fewer new graduates entering the profession
• More demand for specialist accounting services

These affect small and medium-sized firms the most as they can’t compete with larger firms for talent. The shortage is most acute in bookkeeping and routine tasks which is the bread and butter of many accounting services.

Why Outsourcing Bookkeeping is a Smart Solution

Outsourcing bookkeeping offers a solution to the staffing problem:

• Cost-effective access to skilled professionals: By outsourcing, you get access to a global talent pool without the overhead of recruitment, training, and full-time salaries. You get access to specialized skills at a fraction of the cost of having an in-house team.
• Free up internal resources: Delegating routine tasks to external providers means internal staff can focus on high-value activities. Your team can spend more time on advisory services, tax planning, and strategic consulting and increase the firm’s value proposition.
• Scale and flexibility: You can scale up or down as per client demand without hiring or firing. That’s crucial in today’s world.

Benefits of Outsourcing Bookkeeping

While the above section dealt with some of the positives of using outsourcing as a solution for staffing shortage, here we look at some of the more important benefits of using bookkeeping outsourcing services.

More efficiency and productivity: Specialized teams focus on bookkeeping only, so faster turnaround times and streamlined processes. Specialization often means better quality work and more productivity.

Access to the latest technology: Many outsourcing providers invest in the latest accounting software and tools, which can reduce errors and improve accuracy. Great for small businesses that can’t afford the latest and greatest systems.

Compliance and accuracy: Outsourced bookkeeping teams stay on top of the latest regulations and standards so your firm doesn’t need in-house training.

Outsourcing Benefits Client Services - Here's How

Let's take a look at the impact that outsourcing can have on your accounting firm. Freeing up time for your staff from mundane jobs can give them and you as a firm owner an opportunity to improve your client relationships and offer better services.

• More time for client interactions: With the routine tasks offloaded, your staff can focus on clients, understand their needs, and offer bespoke solutions. This personal touch can increase client satisfaction and loyalty.
• Better service delivery: Outsourcing means deadlines are met and clients get timely, accurate financial reports. This reliability will boost your firm’s reputation and client trust.
• Additional services: Outsourcing means you can add services to your offering without adding staff. Payroll, accounts payable/receivable, financial reporting etc. By freeing up internal capacity you can add services to your firm and tap into new revenue streams. This will help you attract new clients and deepen relationships with existing ones.
• Supporting firm growth: Outsourcing allows your firm to grow without the bottleneck of recruiting and training new staff. This will lead to long-term growth and increased market share.

Overcoming the Fears of Outsourcing

While there are many benefits to outsourcing, you will have concerns. It is best that as a firm owner, you address these concerns head-on:

• Data security and confidentiality: Choose an outsourcing partner with robust security in place. Make sure they comply with data protection regulations like GDPR and CCPA to protect your clients’ sensitive information.
• Control and quality: Set up clear communication channels and performance metrics to monitor the outsourcing partner. Keep final control of key client deliverables to make sure they meet your firm’s standards.

Choosing A Bookkeeping Outsourcing Partner

Now that you have decided to outsource, the next question, and a very important and challenging one at that is the choice of the bookkeeping outsourcing partner. Here are some pointers that you can use to make your decision without delay and confusion.

• Assess potential partners: Qualifications, experience, reputation. Make sure the provider meets your firm’s standards and can deliver to your clients.
• Technology Awareness: Check the provider uses software that integrates with your firm’s existing systems to avoid workflow disruption.
• Ongoing communication and collaboration: Set up regular check-ins and updates to ensure smooth operations and clear task understanding. This open communication is key to a successful outsourcing relationship.

When faced with staff shortages, outsourcing bookkeeping services is a key strategy for accounting firms to not only survive but thrive. By outsourcing you can ease staff pressure, improve service quality, and position yourself for long-term growth. Now is the time to outsource. Contact us for more information.