Big business has leveraged strategic outsourcing for years. More recently, the emergence of new technologies and software products has made outsourcing a smart choice for small business, particularly in the areas of accounting and finance. Small business is increasingly turning to outsourcing in these and other areas as a way to control costs, increase efficiency, reduce risk, enhance productivity and focus on core business objectives.
The Expansion of Outsourcing
According to a recent study by Ovum, companies are expanding outsourced services beyond the traditional areas of payroll accounting, accounts payable and accounts receivable. Business is “moving up the value chain,” according to Ovum analyst, Ed Thomas, and “looking to move from relatively basic transactional processes, such as accounts payable to more strategic functions, like budgets, forecasts and internal audits.” As companies look for new ways to cut costs and increase efficiency, they are incorporating an ever-wider slate of outsourced activities, including those related to employee productivity.
The Benefits of Time Tracking Software
Time tracking software provides a way for employees to track their time sheets in real time, and for managers to assess employees’ relative productivity levels. As such, time tracking software is an increasingly important human resources tool for small business.
Time tracking software increases productivity by:
- Providing managers with a tool to measure employee performance. Able to see how employees spend their time, managers can assign tasks based on competency, reward high-performing employees and counsel those who are underperforming.
- Assessing appropriate staffing levels: Managers can control payroll costs by determining if the inability to achieve desired outcomes is related to inadequate staffing or to weak employee performance.
- Enhancing performance reviews: Managers can more easily measure the productivity of employees against one another and against group averages.
- Giving employees a tool to improve their own performance: Time tracking software empowers and protects employees by quantifying their productivity and permitting them to participate in managing their own time. By creating individual action lists and performance goals, along with the steps necessary to achieve them, time tracking software contributes to employee motivation and morale.
Finding the Best Time Tracking Software for Your Business
Every business is different, and each needs its own set of time tracking features. In general, however, there are common core features offered by the best software that are applicable to the needs of most small businesses. These include ease of usage, generation of clear and comprehensive reports, mobile and GPS capabilities and the ability to generate employee alerts and reminders.
TSheets is among the strongest time tracking products on the market, both because it is relatively inexpensive (important for small businesses) and because of the comprehensive features and benefits it offers. These include mobile time tracking, employee scheduling, sick leave, flex time and vacation tracking, approval process control, attendance, management, project time tracking and multiple pay rates and projects.
TSheets is one software product among the many which have revolutionized the way small companies do business, making outsourcing a more attractive option. In the years ahead, as its benefits become more apparent, small business will discover new and better ways to leverage outsourcing and new business functions to outsource.
If you need help analyzing whether time tracking software can help improve your small business accounting productivity, our dedicated accounting software and technology integration specialists can help.
Many small businesses fail because they underestimate the expenses of staying afloat during the first few years. This can be attributed to poor financial management on the part of whoever is in control of the money. It goes without saying that precise accounting is crucial to the long-term success of any business. However, most small businesses still insist on keeping the accounting in-house because owners want to be in control, they're worried about confidentiality and security, they don't have confidence in the abilities of a third party, or because they think that outsourcing is too costly. These are all valid reasons, but the problem is that most owners and their makeshift accountants don't have the accounting background to successfully manage company finances. Here are some downfalls of leaving bookkeeping in the hands of someone who isn't qualified to do the work.
Every small business should be able to track the flow of each company dollar. The only way to stay on top of all the numbers is to be very meticulous about recording transactions. Balancing the books isn't a job for an in-house amateur. It's a job for a professional who is organized and detail-oriented. Without these attributes, you'll eventually start wondering where some of your money has disappeared to. Minor errors will add up over time to cause huge issues. Without knowing exactly what your profit margins are, you could end up making investment decisions that you'll pay dearly for. Every business decision will be affected when you're working with numbers that aren't accurate.
Improper Payroll Calculations
For many small businesses, payroll is the number one expense. This is especially true for those that have a large number of employees. Paying your workers is a very important part of any business agreement, and they all expect to be paid in full and on time every time. People have bills to pay and families to support, so they can't afford to be given a check worth only two-thirds of the hours they worked or two weeks after the regular pay interval. Failing to pay workers on time and in full could mean a huge decrease in productivity because you have taken away their motivation to work hard. As a result, your profits could take a huge dip. Whoever is in charge of payroll needs to be good with numbers, highly organized, and have a good understanding of the tax laws and regulations.
Failure to Meet Deadlines
Running a business is expensive. There are so many different things that you have to pay for, including rent, utilities, product, employees and more. Many of these expenses must be paid off at regular intervals. If your in-house bookkeeper isn't adept at the job, he or she will probably end up spending way more time than necessary on every task. This means forgetting to pay bills when they're due, failure to produce financial reports in time for making important business decisions, or worse. You could rack up hefty penalty fees, destroy your credit score, or even run out of money to keep your doors open.
Spending More for Less
If you only have one accountant on payroll, you're probably paying him or her a pretty decent salary considering how crucial those duties are to the success of your business. Unfortunately, many small business owners are paying incompetent bookkeepers way more than they deserve. That money could be far better spent on outsourcing the job to a professional accounting services company. In many cases, you'll end up saving some money as well. Even when you don't, having an experienced third party manage your company finances is well worth the extra money and peace of mind.
Whether you need help with basic bookkeeping--or require more advanced oversight from a dedicated controller, our team can help. Schedule a free 30 minute consultation today to find out!
Return on investment (ROI) is a fiscal and strategic business concept--and a critical part of basic accounting. On the one hand, many investors want you to demonstrate realistic ROI predictions before they invest in your business. On the other hand, you need to make realistic ROI predictions when deciding how you will grow your business. Both hands rely on realistic ROI predictions to make sound business decisions.
ROI calculations are simple. Add up all the probable revenues a specific opportunity will generate. Then, subtract all the probable costs you will incur for pursuing that opportunity. The remainder is the likely ROI for this opportunity. A good opportunity from an ROI perspective is one that generates a positive ROI or a profit. A bad opportunity is one that generates a negative ROI or a loss. The best opportunity is the one that generates the most profit.
When predicting revenues, you need to consider:
Direct revenues that will be generated by the opportunity
Indirect revenues that will be generated by the opportunity
Residual revenues that will be generated by the opportunity
When predicting expenses, you need to consider:
Direct costs incurred by pursuing the opportunity
Indirect costs that will be incurred if you pursue the opportunity
Opportunity costs for not using your energy, time, and resources to pursue other opportunities
All of these factors must be considered to produce an accurate ROI prediction. The really tricky part, however, is looking into the future and making a realistic prediction for each of these factors.
You must set aside your biases (what you want to be true) and conduct research (what is true) to make a realistic ROI prediction. You must also balance the science and the art of ROI. You can research the number of people who use a product or service, the percentage of users who want a better experience, the effort required to convert them, and your penetration rate. You can only guess at market changes that impact your predictions and the costs you will incur to adapt to those changes.
Predicting ROI requires research and honest calculations. It also requires having a feel for your market and its upcoming changes. On the one hand, there’s a lot of business science involved. On the other hand, there’s a lot of artistic, intuitive guesswork involved. You need both hands to make realistic, accurate ROI predictions.
If you're struggling to predict ROI and need help with small business accounting strategies, our experts can help.
Small businesses are migrating to cloud-based accounting in increasing numbers, seeing it as a viable solution to more limited and tedious hardware-based accounting programs. Cloud storage provides account access by authorized personnel at all times from any connected device, instantaneous updates and real-time financial data on demand.
Cloud-based data storage is the ideal fit for business owners who prefer to keep their operations lean and agile. Checking on daily income while on the move is a quick and simple smartphone task. However, some CEOs consider the prospect of storing sensitive financial data online to be daunting.
The Basis for Cloud-Based Security Concerns
Some of the primary concerns people have about entrusting their books to the cloud include:
- Data theft via hacking or hardware hijacking
- Data alteration or corruption by inexperienced personnel
- Data loss due to cloud instability
- Data loss when a cloud-based company quits business
Not every cloud-based application has airtight security to say the least, but many go the extra mile to keep your financial data safe. Through a combination of document encryption, user authentication and authorization, many cloud-based accounting services provide a level of protection similar to your online banking institution. Here’s how a leading cloud-based accounting program and several integral apps keep your information private.
QuickBooks Online: A Security Pro
Intuit, maker of QuickBooks desktop accounting software and now QuickBooks Online, kicks off its security system with a secure equipment facility, the Intuit Data Center, where guards stand duty around the clock. Closed-circuit video surveillance, backup power, and smoke and flood alarm systems ensure physical security for the company’s data storage hardware. As good as that sounds, however, you are probably more concerned about online protections to prevent your financial information from getting into the wrong hands.
Intuit depends upon proven safeguards to protect your business data. Its online accounting app has VeriSign Security coverage with optimum SSL – secure sockets layer – certification. QuickBooks Online uses password protection for your login, servers with firewall protection and banking-type encryption technology. Additionally, Intuit is a licensed member of the TRUSTe Privacy Program, a watchdog for fair information practices.
Tallie: Keeping Your Sensitive Data Secure
Tallie is a great cloud-based compatible app that tracks your employees’ expense accounts. It utilizes safe public servers as well as private servers that are shielded within a virtual private cloud not directly accessible from other web locations. In addition, the Tallie system is capable of sourcing and integrating data from your existing protected QuickBooks records.
TSheets: Security Is a High Priority
TSheets is an employee timekeeping app designed to integrate with Intuit products. It has recently upgraded its security rating to match the stringent requirements of the QuickBooks company. One of these upgrades is continuous SSL financial data encryption. Daily data backup and customized permission levels for your personnel allow you to control who can view your payroll reports. Additionally, TSheets software complies with the necessary security standards to prevent data mining.
Bill.com is a bill processing and payment service that is compatible with QuickBooks Online and other accounting software. It has instituted numerous security measures in the interest of protecting clients’ data, including:
- Extended Validation (EV) SSL
- Secure storage facility
- Encryption of all sensitive data in database
- Continuous off-site backup to eliminate data loss
Although some cloud-based accounting systems are safer than others, you always run a slight risk when it comes to working online. That is why it’s important to rely on an accounting services provider who has the expertise to select the right accounting systems with the best security available to keep your online business data virtually secure.
Need help with understanding which cloud-based accounting apps are right for your business needs? Our team of certified experts can help!
We recently began the process of training and certifying all of our professional bookkeepers on a great automated bill payment and processing system--Bill.com. We've been following Bill.com closely and bringing clients on to the platform as they are ready, because Bill.com does so many great things to improve the flow and efficiency of online bill payment. The reasons why are pretty simple and straightforward--but we will let you decide that for yourself.
One very helpful hint though: If you've ever suffered from paying bills late (or losing them all together) because they got stuck on someone's desk, didn't get approved by the right people, or ultimately didn't get appropriately reviewed before approved because a deadline was looming... well, you just might appreciate these features.
Bill.com to the Rescue
Bill.com is an online accounts payable and accounts receivable service. Its main advantage is that it:
- saves time and costs through streamlining the entire submission, review and approval process
- integrates with other accounting software (including QuickBooks and QuickBooks Online) and eliminates duplicate data entry and redundancy
Things like printing invoices, stuffing envelopes, internal distribution to reviewers and check signing--Gone!
Accounts Payable is Faster
Send Bill.com your billing data – scanned, email, or fax, and Bill.com picks up the load. When a company uses Bill.com to pay invoices, the process is thoroughly automated, integrating with human intervention at the appropriate approve and review points. But the shuffling and transfer of paper bills and checks is eliminated.
When the bill is due for payment, your bookkeeper assigns it through Bill.com which routes it to someone in your company who is authorized to approve the payment. Once the designated person clicks the approval button, Bill.com takes over and can either pay the invoice electronically or mail a check. Bill.com cuts accounts payable processing time in half. As a cloud-based system, approval can take place anywhere, at any time. If Manager Mike is out of the office on vacation, he can still pay bills on time.
With Bill.com, you can go paperless. Your customers receive invoices via email or Bill.com will print and mail the invoice for you. Bypass printing, mailing and long wait times in collecting receivables. With one click, programmed invoices go to customers by email or by U.S. mail.
Bill.com provides automatic reminders when payments are becoming due or have not been sent. When the customer pays the bill, Bill.com will make your electronic bank deposits. Plus, your customers get three easy ways to pay your invoice:
- by credit card,
- through their PayPal account, or
- by direct payment to you from their their bank
Cash Flow Forecasts
Using Bill.com for your AP and AR can allow you to effectively use their Cash Flow Forecast tool, allowing you to:
- manage your cash flow either on your computer or mobile device, and
- project and forecast your cash flows up to three months into the future
Plus, it syncs with your bank balance information in QuickBooks, giving you a full picture of your current and future financial position.
Works with QuickBooks
Bill.com has a great integration with QuickBooks. You bring in everything right away from QuickBooks to pay your bills and get paid by customers. Bill.com syncs and sends your payments to QuickBooks automatically. Bill.com picks up any changes you have made in QuickBooks since your last login. QuickBooks also picks up any Bill.com changes you made in the data it receives from Bill.com.
For many of our customers, Bill.com is fixing a previously cumbersome process. Our bookkeepers love it because it allows them the opportunity to seamlessly process and notify clients about upcoming deadlines and due dates--and our clients love it because it removes most of the burden of staying current from their desk. A few button clicks and bill processing is complete.
Interested in learning how you can implement Bill.com at your company? We can help--schedule a free consultation to discuss your accounting and bookkeeping needs to see if Bill.com (and other great accounting integrations) makes sense for your business.
There is a revolution occurring in the accounting software industry--and it is taking small businesses with it. Where there were previously limited options available for SMBs without enterprise-level needs and resources, the market has recently been disrupted by quite a few tech-savvy accounting software providers offering enterprise-level software for SMB needs.
However, it can be overwhelming to navigate integrations and implementations--especially when trying to decide which applications to deploy in your business. Perhaps you are considering including expense tracking management, mobile time sheets or want to integrate your POS with a new QuickBooks Online file--but how do you know what to evaluate and whether they will all play together nicely?
While your accounting service or the app developer will likely have support and guides available for your perusal, we recommend evaluating three preliminary features of all integrations before going any further in your research. After all, time is money--or at least you will find that out after you integrate your time tracking with QuickBooks. So before signing on to anything, check to make sure each integration helps you do the following:
1. Improve Data Aggregation
The primary benefit of accounting software integration is keeping your data synced between multiple applications. The core of any integration is the seamless transfer of information from one source to another, preferably with two-way synchronization at all times. Does your CRM integrate with QuickBooks to help with job costing and class tracking? Make sure that your clients and projects, hours spent, expenses accrued and everything else will appear in each program so you can navigate with ease and avoid spending any time on redundant data entry.
2. Reduce Data Entry
Speaking of redundant data entry, your integrations should transform your workflow so that it is as automated as possible. This means reducing or eliminating entirely the need for anyone to hand key information. If you're not familiar with how to directly import and upload data from your bank, credit card or payroll, you either need to start learning more about QuickBooks and your integrations or find a bookkeeping service that can do it for you. Spending any time manually entering data is a waste of time for you and is counterproductive to the purpose of seamless technology integrations.
3. Establish Automated Workflow
When you remove the requirement to hand key or manually enter information, you open up the opportunity automate the review, approval and processing functions of your accounting and bookkeeping processes. Simply, you stop creating opportunities for delays and oversights because the burden is on the software integrations to move information along instead of the approvers and service providers. Whether you're using an outsourced bookkeeping service to handle your reconciliations and accounts payable or you're managing it in house, you'll find integrations like bill payment processing will help move the entire process into quick and simple steps and keep your accounting humming along.
Not sure which accounting technology integration to start with? Our experts can help you navigate which services are right for your needs and get your accounting processes into modern day.
We often meet a lot of clients at a critical turning pointing in their growth phase. Business owners who have met that ellusive million dollar mark in annual revenue (though some times they arrive at our virtual door a bit later) and suddenly feel the burden of managing their own bookkeeping catching up to them.
It doesn’t take long for a new business owner to understand that accurate and up-to-date financial records play an important part in the success of a business. At the same time, the daily tasks required to maintain these records often fall to the bottom of an owner’s to-do list of priorities. After all, business owners didn't go into business to become bookkeepers--and the value of time spent on maintaining the books translates into a pretty expensive hourly rate!
Hiring a bookkeeper to handle the accounting tasks in-house for the business is one solution to the problem, but it isn’t always the best solution. Here are five good reasons to outsource bookkeeping services:
- Privacy. There are few things more guarded in a business than internal financial records. This is information that an owner wants kept private and secure. Finding someone you can trust to do the job well, stay with the company long term, and maintain confidentiality is not a simple task--especially when a local bookkeeper knows your personal financial health. Outsourcing to a virtual bookkeeping service with strong client references can give an owner peace of mind by removing the opportunity to have a member of their community in contact with their financial records.
- Scalability. Growing businesses often start out with smaller needs but rapidly grow to require a full suite of bookkeeping services. Hiring an outsourced bookkeeping service with controller oversight and a full service offering enables the service to scale to needs, without having to hire or train additional staff.
- Training and Management. Most business owners are not in the position to be able to train or manage bookkeeping staff--primarily because their bookkeeper likely knows more about it than they do. But the benefits of having a bookkeeper up-to-date on the latest QuickBooks features or have comprehensive knowledge of state tax rules or reporting methods makes a big difference in the quality of bookkeeping.
- Maximize Your Resources. When business owners try to save money by doing their own bookkeeping or delegating it to another key employee, they are expending valuable time and energy that could be better used growing the business. When they outsource their bookkeeping services, they free themselves up to spend their time doing what they do best. CFOs, office managers and non-accounting personnel simply shouldn't be spending their time on the books.
- Tax and Audit Ready Financials. Using outsourced professional bookkeeping services to prepare financial records makes accountants, the IRS and banking institutions happy. There is no concern over whether the books are accurate or questioning the integrity of the financial data. Whether a business owner needs to provide financial statements to the bank, satisfy investor reviews or share information with the IRS, outsourced bookkeeping services help make sure there is no doubt about the data.
Whether a business needs current financial figures to present to a banker or it just needs to keep tabs on cash flow, keeping up to date on accounting tasks is essential; An easy solution is to outsource bookkeeping to a professional service.
Interested in finding out more about how you can outsource your bookkeeping? Contact us for more information!
In honor of the upcoming Independence Day, we're highlighting a couple of revolutionary accounting software products available on the market today. Today's blog post takes a look at the benefits and features of one our our favorite expense management and reporting apps - Tallie!
From their very cool San Francisco office mere steps from AT&T Park to their awesome staff and dedication to creating the perfect expense management app, we can't get enough of Tallie! (We swear, we use it ourselves!). So if you are you looking for an expense accounting mobile app that automates an employee’s entire expense report every step of the way, has easy integration with your QuickBooks or Bill.com applications, and perhaps prefer a company that recently won a whole slew of awards, Tallie for iOS or Android is what you need.
Tallie streamlines the expense reporting process without actually skipping any steps, and it has built-in auditing triggers that will keep any accounting services manager satisfied. Tallie’s product support experts get the customers up and running, fully integrated with the local accounting environment.
The Tallie Workflow
The best way to take advantage of what Tallie has to offer is from the workflow perspective. Tallie automates the claim to approval to posting, streamlines it, and has built-in triggers along the way.
- Record Expenses: The employee records the expense. It could be a smartphone image of a meal receipt, a credit card import, or a mileage calculation based on origin and destination. Expenses accumulate until they are transmitted to the manager via email.
- Check the Work: The manager rejects or approves the expense. The employee’s email report may contain reviewable receipt images, flags for possible duplicate entries (to keep honest people honest), or flagged expense items that fail to comply with company expense policies (for instance, your organization might not reimburse for alcoholic beverages with a meal).
- Bring in the Data: The accountants bring in the expense data and integrate it with everything. Actually, this step could be promoted to number 1, because before steps 1 and 2 occur, your accounting services company has already:
- synced Tallie with the QuickBooks or Bill.com accounting applications or other flat files
- created user accounts for employees who claim expenses and managers who approve them
- set up the Tallie expense categories and mapped them to the general ledger
- provided the final destination for exporting all the expense transactions
- set up the rules that detect unauthorized expense claims
- customized any unique chains of approval based on project or organizational element
Reports and Analytics
There’s gold in all that data, and your bookkeeping and controller services can mine it all by viewing an individual expense report, or as a group to any active payroll or bill payment system. Tallie also has an analytics engine with detailed reports and chart options.
So no matter what the source of the expense or the destination of the data, Tallie is definitely the application your accounting service has been waiting for.
Did we mention they also recently won a Stevie Award for Support Team of the Year in the Computer Services category? Who wouldn't want an app most recently recognized for stellar support? (seriously, check out all those awards!)
Need help choosing the accounting technology integrations for your business--or making sense of the data they provide? We can help!
In honor of the upcoming Indepedence Day, we're highlighting a couple of revolutionary accounting software products available on the market today. Today's blog post takes a look at the benefits and features of one our our favorite time tracking apps - TSheets! From simply producing an excellent product to keeping us on our toes with creative engagement and messaging, we're huge fans of this Idaho-based company.
CEO Matt Rissell is a visionary in the field--and a lot of fun to hang out with if you ask our co-Founders Bill Gerber and Dennis Najjar. But don't just take our word for it--follow him on Twitter or Google+ and see how he isn't just having fun, he is working hard to change time tracking as the world knows it. So if you're looking for a timekeeping mobile app that works on both Apple and Android devices, has easy integration with QuickBooks accounting software, and is the brainchild of a company dedicated to producing a great product--well, you just might want to check out TSheets.
In a nutshell, TSheets is an app that tracks, manages and reports employee time and can be run on a variety of mobile devices, including laptops, tablets, and smartphones. If your accounting software is begging for the meaningful data and insights that time tracking provides, TSheets will be your new best friend.
The app is ideal for tracking employees who work remotely or switch job locations regularly. Employees can report time across 6 mobile app versions:
- the Apple iPhone with its intuitive graphical interface and GPS tracking
- the Android app with its easy-to-use mobile time tracking
- the crew app for both platforms where the crew boss logs in multiple workers
- the text version for mobile employees not equipped with smartphones
- the ever-popular Twitter interface where employees can log in time from anywhere in the world
And before you worry about the threat of a poor service area or offline connection, TSheets tracks time and automatically syncs when service returns.
Why Your Accounting and Bookkeeping Service Loves TSheets
The initial reasons are easy to understand--there is no confusion about when and where an employee worked and it directly ties in to accurate payroll, PTO and vacation reporting with virtually no additional work required. However, when you start working on budgeting and forecasting for your company's financial future, you may want to understand which jobs and projects cost you more. Do you have the data behind how many employee hours were spent on each project and at which rate readily accessible?
Quick integration with your accounting software can attach those hours to your specific jobs and projects, giving a complete snapshot of your financial data to your controller. The next time you want a better understanding of your profitability across different channels, TSheets will be your new best friend.
Payroll reports: TSheets can be configured for specific job or cost center charging. Gone are the days when after-the-fact “pencil-whipped” timesheets were based on faulty memory, inaccuracy, and bad penmanship. TSheets gives your payroll people just what they need to know – immediately – for employee overtime, individual job breakout expenses, and total daily hours worked.
Timesheet Auditing and Approval: Managers don’t have to wait until the end of the payroll cycle to audit, approve, or reject time sheets.
Job Coded Project Reports: It’s all in the TSheet database. When it comes time to bill out and invoice projects, the information is all there and can be grouped into customized reports and downloaded for additional analysis and reporting.
DCAA and DOL Reporting: Defense contracting auditors and Department of Labor bean counters require accurate time card keeping – sometimes tracking specific tasks or projects by the hour. TSheets to the rescue!
Oh, and don’t forget that TSheets plugs right into QuickBooks. (We mentioned that--we're just such big fans of accounting technology integrations and this one is a great one!)
Need help adding time tracking to your accounting and bookkeeping services? We can help!
As a business owner, it’s important to regulate your processes, especially if you are outsourcing accounting tasks. Having a number of independent contractors can pose a huge problem when protocols are not in place to make sure they are properly regulated.
From Inc. Magazine, here are a few tips that will help in establishing a great working relationship with your contractors and maintain the integrity of the business transaction:
- Classify contractors, and delineate a clear distinction between your contractors and employees. Doing this will ensure your company avoids any liability or claims about whether the contractor is really an employee. Independent contractors set their own hours and handle everything else that is needed to get the work done.
- Have clear objectives for the tasks to be performed. A defined scope of work and timeline should be conveyed to contractors before they start work. All expectations from both parties should be outlined.
- Make sure everything is agreed in written form or a contract. All important communications should be in writing in the event there are discrepancies. Any confidentiality clauses or ownership claims should be outlined.
- Get all the tax-filing information you need to establish payments and record-keeping for tax purposes. This will help when issuing 1099 forms at the end of the year.
- Make sure contractors have a point person to contact in the event they have questions or need assistance.
Independent contractors can be an asset to your company if used effectively. Quite a few business owners run into problems when they treat contractors as employees. Knowing the guidelines and maintaining the rules of independence are the keys to ensuring mutual understanding.
Some other factors that are important:
- As a business owner, you should make every effort to pay your contractors in a timely manner unless other arrangements have been made.
- If the contractor is reliable and does good work, make sure you convey your satisfaction. There’s nothing more valuable than a company that is pleased and shares this information. It puts you in a good place as an employer and can help the contractor continue to do a great job.
Until you can fill all your business roles with in-house employees, independent contractors are a great resource to cover the gap (and may even make more sense than hiring employees for some roles). Make sure you do adequate research and get referrals. As a stepping stone, independent contractors can help you grow your business to the levels you desire.
Need help classifying your independent contractors? Our accounting and bookkeeping experts can help!