Why High-Quality Bookkeeping Matters for a Successful Small Business

October 21, 2022
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NGMI

In 1993, English writer Sir Terry Pratchett released a fantasy novel, Men at Arms. The book, the 15th in the Discworld series, contained an unassuming and brief commentary on socioeconomics that had stunning implications for the public's understanding of poverty. Here's a brief excerpt:

"The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money. Take boots, for example.

He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about ten dollars.

Those were the kind of boots Vimes always bought, and wore until the soles were so thin that he could tell where he was in Ankh-Morpork on a foggy night by the feel of the cobbles.

But the thing was that good boots lasted for years and years. A man who could afford fifty dollars had a pair of boots that'd still be keeping his feet dry in ten years' time, while a poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet."

This stunningly simple observation from Pratchett's novel touches on numerous social implications regarding poverty in society, but it also carries an important lesson for business owners.

Quality Matters for Everyone

Accounting has become a necessary evil in the eyes of most business owners today. If you're not a math person, bookkeeping can seem incredibly daunting to manage on your own. Accounting concepts can feel overly complicated and confusing even if you are good with numbers.

Regardless, taxes remain due every year, so most business owners choose to seek out a seasoned accountant's help.

Though, just as with any product or service, there are levels to the quality of work you receive from any service provider. Price doesn't always correlate to the quality of service you receive, but it's often a leading indicator of what you can expect.

Cheaper, low-touch bookkeepers often have less experience, more clients, and cannot provide vital insights to your business. Many inexperienced bookkeepers will simply "get the job done", but can make serious mistakes along the way that you may not be aware of. These mistakes compound and, eventually, become difficult and costly to fix. Ultimately, your growth becomes limited, and your stress levels increase.

High-quality, proactive bookkeepers may be more expensive upfront, but ultimately, they'll ensure that your business is started on the right foot. Instead of simply waiting for questions to arise, an excellent accountant will work to implement financial systems and processes that help your business grow and improve. They'll work with you toward a deeper understanding of your business, resulting in more sales, accurate expense tracking, and less stress.

Often, if you choose not to pay for a high-quality service the first time, you'll pay more in the long run.

What Makes A Service High-Quality?

It's usually pretty easy to tell if a product is made cheaply. You can feel the difference between pleather and leather, wood and particle board, and well-made pieces vs. shoddy craftsmanship.

Checking out a high-quality service is much more challenging. Not impossible, but hard.

Most service-based business relationships rely on trust. When you first meet with a new service provider, you're trusting that they will be able to provide everything they say they can and follow through with what they're communicating. You're trusting that their service can actually accomplish the benefits you expect to see!

This level of trust is like walking through a minefield blindfolded; you're implicitly allowing someone to guide you through something because you don't know what to look for.

To determine whether a service is high-quality or not, you've got to ask the right questions and evaluate your potential provider's knowledge about your specific problem. An excellent service provider can explain why your problem exists, the solution they want to provide (in understandable detail), and any foreseen struggles or hurdles they've encountered in the past when dealing with a similar situation.

You've taken the blindfold off by asking questions. Suppose a provider can show a deep understanding of your current situation while pairing it with a clear, effective solution that's worked in the past. In that case, you'll feel more confident moving forward with them.

Instead of blindly strolling through a minefield, you'll see a clear path to survival and success.

Jeremy Millar
Written by:
Jeremy Millar

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