How to Start A Bookkeeping Business?
Photo from Unsplash
Originally Posted On: https://taxsaversonline.com/how-to-start-a-bookkeeping-business/
Bookkeepers are some of the most in-demand professionals in every sector globally. Managing and maintaining financial records like payroll, profit and loss statement, cash flow, and investments are challenging for a businessperson with no background in accounting. This is when both small businesses and giant corporations require the help of experienced and qualified bookkeepers to meet their business needs.
The importance of bookkeepers has increased even more in the last few decades due to the amendments in business tax laws, financial data recording policies, and fund transfer methods, i.e., increasing use of online methods.
However, bookkeepers have the ability to manage complex and challenging tasks. Therefore, establishing your own bookkeeping business can be a good decision. Of course, you have to face great competition once you get on the field. But after considering all the factors and conducting market research can help you deliver the best services, leading to higher success rates.
Are you organized? Do you like crunching numbers and paying attention to details? Do numbers fascinate you? If so, starting an online bookkeeping business could be ideal for you!
So, how to start a bookkeeping business with no experience of operating a company? It will not be difficult if you use your knowledge and business acumen and follow these tips and tricks.
How to Start a Bookkeeping Business?
If you have the right qualifications and bookkeeping knowledge, initiating your own business is not challenging. Follow these tips and tricks to create your own bookkeeping business.
Choose Your Niche and Market
Almost every industry requires different bookkeeping services- after all, every company needs to manage its finances and track its expenditures. However, before launching your business, make it unique and different from your competitors. In that case, it’s better to choose an industry that interests you and needs expert bookkeepers. This trick will help you expand your business, whether you have chosen to create a physical or online bookkeeping office.
Furthermore, this trick will help you develop credibility in your specified market. You will also master some most needed services, as you will be involved in particular things related to the market. Determining your target industry will also help you decide your audience.
Before picking a niche, you need to understand how bookkeeping works in different sectors and what services you need to provide in your chosen industry. Doing in-depth research about the growth and popularity of the sector is vital. This helps you understand whether the sector you have chosen will flourish or witness a downfall after a few years.
Earn Your Certificates
One of the easiest and quickest ways to gain the trust of potential clients is to prove that you have the necessary knowledge and experience to manage tax returns and payroll, and other bookkeeping duties.
If you haven’t taken a course in bookkeeping or accounting, you can still become a bookkeeper by getting the certification. Unlike CPAs, bookkeeping certifications are not backed by the state. Therefore, you need to choose reputable and prominent institutions so that your certification is respected.
You can opt for the most popular organizations, like the American Institute of Professional Bookkeepers (AIPB) and the National Association of Certified Public Bookkeepers (NACPB).
Accounting Software Certification
If you are thinking about starting a virtual bookkeeping business, get an accounting software certification. Many accounting software companies offer a certification program so that you can learn to use the software. It helps you become proficient, allowing you to use it for your business.
When you master the software, you will be able to satisfy your clients and offer the best services. Both small and big companies will also get impressed with your abilities to manage the entire financing and accounting process and its nuances with the software.
Besides that, if you choose reliable and secure software, your customer can also check and benefit from stats, graphs, and records of their company at any time through the software. The more tech-savvy you are, the easier it is to attract clients and retain them.
Write a Business Plan
Thinking about how to start a bookkeeping business with no experience? Well, before anything else, make a business plan. No matter what type of business you want to run, every entrepreneur needs to write a business plan, and bookkeepers are no exception.
A business plan helps you outline your plans for your business with the smallest details. This is a comprehensive plan that includes what services you will offer and what competitive advantage your company has.
You also need to determine the vision and objective of the company. This document will be several pages long, but it will help you in the long run.
The business plan will also help you focus on your company and operate it efficiently. When you are creating a business plan, here are two aspects that are more important than others.
Choose a Business Name
We all know that a business name makes the first impression of your company. This is why you need to think about the name carefully. Take your time and do a bit of brainstorming. Think about what do you want to communicate with your name? How you can show your expertise with the business name.
When you come up with a name, make sure that no other company is using the same name. Plus, take the opinion of your friends and family regarding a suitable name to get an idea of what people think about it. Once you finalize a name, you can run it through the secretary of state’s business database to ensure that no one is using it.
Another thing you need to specify is your services. You need to determine what type of services you can provide to your clients. Can you give online or virtual services? Do you have any software that your clients can use on their personal devices? Do you offer tax services?
When you know what type of services you can give to your customers, you can focus more on these services. Make sure to choose accounting services that resonate with your experience and skillets. If you are good at managing small businesses, add it to your services.
Fund Your Business
You may also need to fund your business. Your business plan will help you estimate startup costs. Generally, startup costs can be significantly low if you decide to operate your business virtually. In other words, you don’t have to lease office space.
To make your business successful, professionals recommend saving six months’ worth of expenses in your bank. If you don’t have any savings, the following option will work for you.
Get a Business Credit Card
If you are planning to open your business soon and want to finance your company, you can apply for a credit card. A business credits card is the easiest way to get financing for your company in the early stages.
It can work as the best source of financing to help you with necessary expenses. You can use a credit card to purchase software and equipment for your company.
Small businesses usually use a credit card to earn rewards and manage working capital. While it’s not necessary, you can use it to deal with unexpected expenses as you work through your business.
Register Your Business and Get Insured
The next step is registering your businesses and making things official. The exact process greatly depends on how you plan to structure your business. On top of that, the location you have chosen to establish your business also impacts the registration and insurance process.
You need to check the exact rules and regulations in your region to incorporate and run a bookkeeping business. Furthermore, you need to contact the secretary of state’s office to register your business.
Determine a Business Entity
The most important thing to open up your shop and register your business is choosing the right type of business entity. It will decide how you pay taxes as a startup. The nature of the business entity will also help you know what kind of liability protection you can avail if something goes wrong.
People who register bookkeeping businesses are more likely to work alone, at least in the beginning or first few years. You can search business entities for bookkeepers by checking LLCs and sole proprietors.
Don’t avoid these steps, as this mistake can cost you in terms of fines and penalties. Choosing the right business entity can help you prevent future problems and ensure you operate your business efficiently.
Insuring your company is your choice, but insurance is the best way to prepare yourself for bigger problems. It can protect you from expensive liabilities if you find yourself in trouble, for example, because of negligence. Note that if you don’t have any insurance, you will have to pay for these things from your pocket and that can cause harm to your business and personal finances.
The good news is that several organizations offer insurance to bookkeepers. In fact, they offer different packages so that you can choose to get maximum coverage. The best bookkeeping business insurance policy includes general liability and professional liability.
So, if you have finally decided to purchase insurance, look for the insurance organizations that offer these policies.
Create a Website
How can you start a virtual bookkeeping business? Well, you need a well-designed website that offers an incredible user experience. A website is important even if you are planning to operate your business from a physical office.
Your website can help you in your quest to attract prospective clients. For instance:
- It will act as a tool to turn visitors into your prospective clients.
- It proves that you are a legitimate business and boost your credibility.
However, your website needs to create an impression and impact when your customers visit it. It should be compatible with all devices like mobile phones, laptops, and tablets. Not only this, but it should also work fast and respond to the client quickly. Here are some tips for creating a professional and engaging website.
Choose Your Site’s Platforms
Several website building platforms come with a range of features, like Wix and GoDaddy. For the long term, it’s best to go for WordPress, which offers you many features, layouts, and personalizing options.
This platform also works exceptionally well if you want to blog. When it comes to SEO to rank your website higher and generate more leads, WordPress can offer easy optimization options, helping you create optimized content.
Opt for a Webpage
Whether you are thinking of hiring web designers or creating a website, you need to decide what type of information you need to post on your website.
Most people make the mistake of adding multiple pages to their website that makes it hard for clients to find the information they need. For starters, it’s better to go with fewer pages, options, and information on your website. So, in the beginning, only add the following page to your site:
- About page
- Home page
Keep the information minimal on these pages- only add necessary details about your services and company.
Price Your Services
When people plan about how to start bookkeeping for small businesses or massive corporations they typically give less thought to their service prices and choose prices without much consideration. This way they either overpriced or charge too low, which can affect the business negatively.
There is indeed no clear answer on what prices will work best for your company. However, the following are some factors that you need to consider to decide your pricing structure.
- The requirements of the market.
- The time and effort you have to put in the task.
- Your bookkeeping experience.
- The type of services you are offering.
- The size of the business you are dealing with.
Moreover, don’t specify generic charges for your services; instead, provide a quote based on the nature of services your client requires. Generally, bookkeeping companies charge a monthly fixed fee or hourly rates.
If you want, you can also negotiate a retainer fee with your clients. Deciding on your fees and getting it right for your bookkeeping business may require a bit of time and work. But avoid pricing yourself too low to attract customers.
This will make it hard for you to pay for business expenses and your personal needs. Remember that you are selling your experience and skill to add value to your client’s business.
Market Your Bookkeeping Business
Marketing is the most important aspect for any business to grow and expand. But it’s also challenging to manage for bookkeepers and accountants. Whether bookkeeping business is your full-time business or a side gig, you can hire a marketing agency with the expertise to promote companies in their market. They will help you decide your logo, content, website, tagline, and marketing strategies.
There are several ways to market your business. You can benefit from social media marketing and incorporate Facebook and Instagram ads in your marketing strategy.
Bookkeepers also need to make Google My Business account to help people find their physical office. Not to mention, if you are operating online, advertising your business on online platforms becomes even more crucial.
Choose Bookkeeping Software
Since you have planned to start a bookkeeping business, you might have already decided which accounting software you need for your company. If not, you must know that there are hundreds of options for bookkeeping companies to choose from. Of course, not all of them are ideal for your company. You need to consider your target market, services, and requirements to choose the best product.
For instance, if you want to give your clients access to data and charts in real-time, you need a software program that allows access to clients. Plus, you need software with great security so that no one can hack it and manipulate or extract your records and data.
Based on the services you are planning to offer, software with the option of managing payroll is important. This way, you can feed details of both new and old employees and automatically transfer their salaries to their accounts at the beginning of each month. You can also look for features like electronic file sharing and record management to offer excellent services to clients.
Now you know how to start a bookkeeping business. Yes, there are so many things to do, but if you follow these tips and tricks, you are more likely to become a leading bookkeeping business in a few years.
Once you have decided everything- from logo and software to prices to services, you can start advertising your business and serving companies. Tax Savers Online can guide you in managing your taxes and finances as well as help you understand tax policies and tax brackets. This way, you can give better and reliable services to your clients.