Small businesses represent more than 90% of all companies globally. They make up the backbone of the global economy but also shape the communities we live in.
While small businesses are used to a “do it yourself” mentality of managing all aspects of their business, embracing a “do it together” approach by partnering with an accounting or bookkeeping professional can help them add a competitive edge.
A Xero commissioned study conducted by Forrester Consulting revealed only 26% of small business owners consulted trusted advisors like accountants or bookkeepers to help maintain cash flow, make predictions and take proactive steps to help their financial situation. The findings showed that those who thrived throughout the pandemic took advantage of such opportunities.
Here are three reasons why small businesses can drive success by working alongside an accountant or bookkeeper.
Cash flow is the lifeline of any small business. A report from JP Morgan reveals half of small businesses hold a cash buffer of less than one month and 25% of small businesses hold fewer than thirteen cash buffer days in reserve.
While many small business owners don’t have a strong understanding of their current cash position, partnering with a trusted advisor like an accountant or bookkeeper can make a big difference to your business's survival. Advisors can help you prepare a cash flow forecast or understand different scenarios for your business, which plays a big part in how you can weather a crisis.
The Forrester Consulting study also found that 49% of business owners are using cloud technology during COVID-19, up from 32% in 2019. Right now, there’s no better opportunity for small businesses to get online and into the cloud. This is especially critical now as many small businesses need to get accounting records up-to-date and accurate to understand how their business is doing or if they’ll need to apply for government stimulus programs.
Accountants and bookkeepers can help you make this transition and develop efficient workflows so you’ll always have a real-time, clear view of your business’ financial health. And, when using cloud-based accounting tools like Xero, labor-intensive tasks become automated or streamlined, saving you time so you can focus on running your business.
The guidance of an advisor can help you make the best possible decisions for your business. Aside from financial advice, many accountants specialize in verticals like technology or e-commerce and can help you identify the best business tools or technology stacks to operate effectively.
For instance, a retail business can leverage apps to support logistics, point of sale, inventory, customer service, and more, so it all integrates within their accounting platform and provides a holistic view of their business operations. By going beyond the basics of number crunching, accountants and bookkeepers can provide customized advice for your small business and play a critical role in helping you operate successfully.
Xero and Salesforce are teaming up to help you find the best advisor for your business. Finding an accountant or bookkeeper that’s the right fit for your business has been essential throughout the COVID-19 pandemic, but sorting through lots of different advisors can be time-consuming. We’ll do the work for you in three simple steps:
Learn more about this service here and get started today.