Are you interested in starting a bookkeeping business? Do you want to know if it is a profitable business? This article will expand your knowledge of everything you need to know about a bookkeeping business.
Also, you will understand and master a bookkeeping business and how to offer services as a bookkeeper.
Every organization needs a bookkeeper, be it a small or a large firm, to ascertain their day-to-day financial achievement.
While a bookkeeping business is interesting, you also need to know that there are principles/factors to understand before going into the business.
If you are deciding on stepping into a bookkeeping business but want to know more about it, if it is profitable and can be done from the comfort of your home, then this content is for you to digest.
Before going further, let’s know what bookkeeping Is.
Table of contents
What is Bookkeeping?
Bookkeeping is the act or process of recording, classifying, and organizing all the financial cash inflow and outflow of a business.
You will need to engage in bookkeeping to obtain an accurate account for a business at the end of the day or annually.
In summary, a bookkeeping business Is a business that deals with the proper recording of a company’s monetary transactions to know the income and expenditures of the firm.
Read this: Bookkeeper Business Launch Reviews 2022: Is It Worth It? | How it Works
Is Bookkeeping a Profitable Business?
At large, before venturing into a business, you need to know if it is profitable and future promising. A bookkeeping business is profitable if you desire numbers, a mind for details, and a penchant for paperwork.
Moreso, a bookkeeper is responsible for maintaining a firm’s financial records, which comprise the company’s cash flow, expenses, and profit and loss.
Bookkeepers maintain a computerized ledger of the company’s transactions and ensure its economic achievements.
A Bookkeeping business necessitates the ability to focus on the books while also keeping your clients satisfied. Hence, balancing both will result in a prosperous business.
How do I start A bookkeeping business?
The good news is that establishing a bookkeeping business is not difficult when followed by the proper process. Let’s see some steps we can take to get a bookkeeping business running quickly.
#1. Obtain Certifications
Proving that you have the knowledge to conduct bookkeeping, Payroll, and maybe tax returns is one of the fastest ways to acquire credibility with potential clients.
You can become a certified bookkeeper before beginning your own bookkeeping business, even if you don’t have a professional background in accounting or bookkeeping.
One of the institutions you can get certified in is The American Institution of Professional Bookkeepers (AIPB), an organization of professional bookkeepers.
To become AIPB-certified, you must first complete 3,000 hours of work experience And then pass a certification exam. Another institution is, The National Association of Certified Public Bookkeepers (NACPB) is an organization of certified public bookkeepers.
To become NACPB certified, you must complete courses in bookkeeping, QuickBooks Online, Accounting concepts, and Payroll and pass an exam for each subject. Before applying for the license, you must have one year of experience.
In addition, you might be able to replace college accounting classes for needed courses, but you’ll still need to pass each exam. After which, you will acquire the credentials CPB (certified professional bookkeeper) if you are certified.
Other certifications are;
Accounting software certification. Examples are; QuickBooks ProAdvisor, zero partner program, FreshBooks partner program, and tax certification.
#2. Come up With a Business Plan
Every business owner, regardless of the firm they run, should prepare a business plan; of course, bookkeepers fall under this category.
Therefore, a business plan is a detailed document that outlines your services and your market and how you’ll gain a competitive advantage in your industry. It will assist you in focusing your business and running it effectively right away.
The following are essential components of any business plan;
- Page 1 of the book
- Brief Summary
- Overview of the business
- Analyze the competitors
- Marketing Strategy
- Cost of starting the business
- Financial Forecast.
How Much Can a Bookkeeper Charge Per Hour?
Depending on the size of the business, the industry, and the financial services needed, a bookkeeper’s fee varies. In-house bookkeepers may bill anywhere from $18 to $23 per hour, depending on their level of experience.
Utilizing an external bookkeeper is an additional choice, with costs starting at $99 per month.
In the United States, a bookkeeper makes $20 on average per hour. However, prices can range from $18 to $23 per hour, depending on education, experience, and extra skill sets.
Determining labor cost depends on whether you require a full-time or part-time staff.
When comparing an in-house bookkeeper and a financial management firm, consider employee costs such as benefits, training, and time off.
Check this: 12 Best Small Business Accounting Software In 2022
The Value of Bookkeeping
Companies can use accurate bookkeeping to assess their success. It also acts as a benchmark for the company’s sales and profit goals as well as a reference for general strategic decisions.
In other words, it is crucial to invest more time and resources in maintaining accurate records after a business is up and running.
Final Thought on How to Set up a Bookkeeping Business
Ensure that you grow as the businesses around you do, too. However, that doesn’t mean you have to take on more clients but expand your knowledge and network.
Keep your knowledge of your favorite platforms up to date and expanding as their features change, and keep your talents current.
You can also go to business gatherings like conferences and networking functions. Bear in mind that investing in your business also implies investing in you.
In addition, there are many ways to market your bookkeeping business:
- Become a business advisor with the Small Business Development Center (SBDC).
- Be an adjunct instructor.
- Get certified in accounting software.
- Sign up with bookkeeper freelancer websites.
- Join a local Meetup group of bookkeepers and accountants.
- Establish a client referral media.
- Establish professional social media accounts.
- Target a niche industry and join their industry association.
Another good thing about the bookkeeping business is that you can do it from the comfort of your home online. What you need is just the knowledge given in this article.
Also, read this: 25+ Most Profitable Small Businesses In 2022 | Expert Advice
FAQs: How to Start a Bookkeeping Business
The Capital Required to Start a Bookkeeping Business. Fortunately, starting a bookkeeping business is inexpensive, especially if you work from home. They’ll be even lower if you start your business as a side hustle before going full-time.
Bookkeeping is a profitable business to start for those with a knack for numbers, an eye for detail, and a penchant for paperwork.
A bookkeeper is responsible for maintaining a company’s financial records, which include expenses, profit and loss, and cash flow. Bookkeepers maintain a computerized ledger of the company’s transactions.
The following are ways to start a bookkeeping business:
1. Pick your market and niche
2. Write a business plan
3. Register your business
4. Choose your bookkeeping software
5. Price your services
6. Find your customers
7. Understand your funding options.
From 2020 to 2030, there will be a 3 percent reduction in the number of clerks employed in bookkeeping, accounting, and auditing. Over the next ten years, there are still expected to be, on average, 170,200 openings for bookkeeping, accounting, and auditing clerks.
Reference
- Financepal.com
- Nerdwallet.com
- Sage.com
- Photo Credit: www.istockphoto.com
Recommendations
- Top 50 Small Investment Businesses In 2022 | Full List
- 200+ Online Business Ideas That Can Make You Wealth in 2022
- How to Start a Business in Arizona 2022: The Ultimate Guide, Step-by-Step
- How to Start a Home Business: The Ultimate Guide, Step-by-Step
- Bookkeeper Business Launch Reviews 2022: Is It Worth It? | How it Works
- 25+ Most Profitable Small Businesses In 2022 | Expert Advice
