Whether your agency is ready for next-stage growth or you just want to boost your bottom line, an outsourced bookkeeping services provider can deliver.
As the leader of a marketing agency, you want to help clients develop their businesses and realize their full potential. Your goal for your own business should be the same. But if you find yourself spending more time on administrative tasks like bookkeeping than on bringing in new clients, it might be time to reorganize your priorities. Here are three easy ways to go about it.
1. Update Your Tech
Still using a desktop app to track your expenses and revenue? Time to switch to a cloud-based bookkeeping app.
The “cloud-based” part is key. For starters, the cloud is secure. With a desktop app, you can lose all of your bookkeeping records if your system crashes. The cloud serves as a sort of safe deposit box — even if your computer system or entire office is damaged or destroyed, your data remains intact and accessible remotely.
That remote access also gives you greater mobility. A cloud-based app allows you to check your books in real time from any location using your smartphone. You can also improve cash flow by linking to billing apps, making it easier than ever for clients to pay you quickly. Plus, you can invoice clients and pay bills while on the road rather than setting aside time to catch up on the backlog upon returning to the office.
Another compelling reason to switch to the cloud? Perception. Keeping up with the times is critical at a marketing agency. You want your clients to know you’re on top of the latest technology. What will they think if you keep mailing them paper invoices?
2. Determine Profitability by Client and Project
In marketing, not all clients are created equal. Using the right financial intelligence, you can drill down into the profitability of each client — or even individual projects — and figure out where you’re making the most money. Then you can double down on those projects and phase out the less-profitable ones.
The right bookkeeping support can help determine:
- Gross profit: This is the amount of money you’re making on a given project, minus across-the-board overhead like rent and utilities. It provides your starting point for a deeper dive.
- ROI: You can start your breakdown on a client-by-client basis by determining how much you’re investing to execute each project (in both hard costs and time spent) compared to how much you’re getting paid. This tells you which clients are generating the highest return, which helps you fine-tune your target market.
- Key performance indicators (KPIs): Basically, your KPIs tell you at a glance how you’re doing and can provide early warning signs for when course corrections are due. If your profit margin for a particular client suddenly shrinks, for example, you’ll need to find out why. Maybe the cost of providing that client with a particular type of marketing collateral, like a branded leave-behind, suddenly spiked.
The combination of the right technology and the right metrics paves the way for smoother integration, such as synching your CRM software with your online bookkeeping app. This, in turn, generates even greater insights and efficiencies.
3. Establish Fundamental Bookkeeping Best Practices
As you transition to a cloud-based, integrated approach at your marketing agency, it’s also time to confirm you’re following bookkeeping best practices. And that probably means it’s time to enlist the support of an outsourced bookkeeping services provider.
A bookkeeping professional will adhere to generally accepted accounting principles and work with your CPA to stay in compliance with all tax requirements. And even if you were capable of doing that yourself, the one best practice you wouldn’t be able to follow might be the most critical: segregation of duties. If you are doing the books yourself and make a major mistake, who will catch it for you? Delegating the bookkeeping to a full-time staff member isn’t the answer either — they would also be susceptible to mistakes, not to mention the temptation to commit fraud.
Go All in on What You Do Best
You became a leader at your marketing agency because marketing is the thing you do best and care about most. So why not devote all of your time and energy to marketing and outsource everything else, including bookkeeping, to professionals who care just as much about their specialty as you do about yours?