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Do’s and Don’ts of Outsourcing Restaurant Accounting Services
In the present business scenario, whichever industry it might be, the focus is on growth and development, maximizing revenue and profitability and by default reducing costs. This is the modern trade mantra and more and more companies are devising ingenious plans to attain these objectives. Since nineties, outsourcing of non-core activities by industries has been considered a very viable option but it was only in the last decade or so that this concept has really been utilized by the business barons of the world to further their interests.
Insurance had been one of the first to take the plunge followed by the healthcare industry. In recent times, it has been the hospitality sector that has taken the lead in the outsourcing arena, first by outsourcing data entry projects and then restaurant accounting services.
The restaurant business has a unique identity of its own. While most industries have multiple product and services portfolio to stay in the race, the core of restaurants revolves around food only without any other distractions. Business goals are based on optimizing this one factor and all other things are secondary.
It is one reason why restaurants are in the process of outsourcing most of their backup work. This includes strengthening the digital presence to cater to the increasing online food ordering segment, digitizing menu cards for the same purpose and spinning off the bookkeeping process to professional restaurant accounting services.
However, the question remains – to what extent would you go for outsourcing. Would you prefer to spin off the whole process and if so is it preferable? The answer lies in going into some detail on the dos and don’ts of accounting services outsourcing for restaurants.
First the do’s –
Outsource Comprehensively –
Since accounting is not one of your core competencies, it makes sense to outsource comprehensively. You will be cutting down on costs and free up your resources to concentrate on increasing business. Remember, the outsourcing agency will have the expertise and long years of experience in this field and this allows you to draw on their proficiencies. If the total restaurant accounting solution is spun off, it will be easier for them to consolidate data and submit reports periodically on the state of the business.
Choose Wisely the Outsourcing Company –
A wrong decision here can cost you dearly. Choose a company that has been servicing the hospitality sector and knows the intricacies of the business. Accounting systems and processes followed are largely industry specific so do some research in this area before opting for one. Most importantly, ensure that they have incorporated the latest and modern innovations like the cloud so that data and your state of the business are always safe, secure and confidential.
Now the don’ts –
Outsourcing Key Discretionary Functions –
Keep a few tasks in your control, not only to have a grip over certain financial parameters but to ensure the security of your business. Do not outsource key discretionary functions like investment decisions, authorizing payments of bills online and signing of checks. You’ll be outsourcing accounts payable and will get a report of the due dates. But make the payment in-house which will, in any case, be reflected in the bank reconciliation statement being processed externally.
Delegating Business Judgments –
While it is not the intention of demeaning the integrity and honesty of restaurant accounting services, you’ll do well not to abandon the basic right of decision making on key financial issues. It is advisable that you and you only decide on how a function will be performed based on reports of operational data. It’s your business and you have to give direction to it, never mind if it falls within the ambit of a non-core activity.
Treat outsourcing of your restaurant bookkeeping and accounting process as a key management strategy to facilitate business growth and development.
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