Starting and running a small business can be time-consuming and, sometimes, overwhelming. Many eCommerce business owners find themselves wearing every hat and performing every role in an effort to cut down on costs. But how much money is that really saving in the end? What you cut in operating expenses, you make up for in less time to pursue new clients or scale your business. When is it time to bite the bullet and hire someone who can help?
We spoke with Isaac Smith, co-founder of Summit eCommerce Business Advisors, for his expertise on the topic. With his input, we put together this guide for hiring a bookkeeper for your eCommerce business.
What Is Bookkeeping?
Bookkeeping is the fundamental first step to accounting. It consists of recording the financial transactions that occur in your business, including expenses paid and revenue earned. You can bookkeep as often as every day or as little as once a year—but it is highly recommended that you update your books regularly. This will help you keep track of how both individual products and your business as a whole are performing. If selling the business is a possibility, having clean and current books is a must.
Why Hire?
In general, hiring a bookkeeper will save you time and energy so you can focus on other parts of the business. Hiring a bookkeeper with e-commerce experience for your business is important because he or she will know the intricacies of the business—both the problems and the solutions. The last thing you want is to hire someone who has no knowledge of the field and requires hours of training and guidance.
When to Hire?
There is no one-size-fits-all answer to this question, but Isaac suggests hiring a bookkeeper when you get too busy or when it becomes too confusing. As your business grows, keeping track of every expense can become overwhelming very quickly, and you may not know how to handle every financial situation. Isaac says that’s when it’s time to get some help. The entrepreneur has a limited amount of time and he or she needs to ask: What is the best use of my time?
How to Hire?
According to Isaac, before hiring a new employee, you should take these three steps:
1. Define the role. Be very clear in what your new hire will do and what they won’t do.
2. Organize your business. It may be tempting to give yourself the final say on all projects, big and small. But in reality, that can be as much of a time drag as just doing everything yourself. Create an organizational chart so that there is a clear chain of command.
3. Define success. Being very clear in what you want the new hire to achieve creates an easy measuring stick for when that expectation is not met, thus allowing you to make better-informed decisions.
Where to Hire?
There are many places to hire an eCommerce bookkeeper. Isaac’s company, Summit eCommerce, is one; but there are also several freelance websites that allow you to connect with people all over the world. Upwork is a very common website used for this purpose.
How Much Will It Cost?
The cost of bookkeeping services varies widely depending on whether you hire an employee or decide to outsource. Hiring an employee will usually cost a mid-range salary plus benefits, while freelance workers found on sites like Upwork can be much less.
Isaac points out that you could even hire someone in a different country, say the Philippines, where a full-time bookkeeping salary of $500 to $1,500 per month provides a good living wage for the freelancer and is great for your bottom line.
How We Can Help
As an eCommerce business owner, your time is precious. If you find yourself too busy or too overwhelmed to keep track of your bookkeeping, Tree Street Advisory can help. Together with Isaac Smith at Summit eCommerce, we can help you hire the right person to manage your bookkeeping so that you can get back to what matters most: growing your business. Call (615) 219-9802 or schedule a free 30-minute introductory appointment.
Allan Phillips is a Certified Financial Advisor (CFP®) and founder of Tree Street Advisory. He works with E-commerce business owners and Physicians who are concerned with issues such as cash flow management, high-earner retirement planning, debt repayment approaches, tax strategies, and business planning.