As with any new career, starting out as a bookkeeper can be daunting.
But many have gone before, and many are willing to offer advice on what to do and what not to do on the first steps of your career path.
Steve Pipe, a chartered accountant and author of The World’s Most Inspiring Accountants, has interviewed multiple award-winning bookkeepers for his next book, The World’s Best Accountancy Practices, and has compiled several helpful tips along the way.
First of all he advises researching and emulating successful case studies.
“Typically more of the dynamic, exciting practices are run by a younger, technologically savvy generation where technology isn’t just a bolt-on but is actually core and integral to their lives and their businesses,” he said.
“So I would look for dynamic young practices that are demonstrating best practices and I would study them and I would learn from them, number one.”
Grasping the true value and benefit of leading-edge modern technology in bookkeeping, will provide an early key to success, and create a dynamic practice, offered Pipe.
Technology and bookkeeping
“Technologically-enabled bookkeeping is real-time, valuable information that goes beyond just a statutory set of accounts for the books. It’s information in the hands of business owners so that they can make better decisions and get better results,” he said.
The US in particular has embraced this kind of service.
“Quite a few of the firms I’ve interviewed in North America have been run by CPAs or chartered accountants, but have focused exclusively on bookkeeping, because they see a massive opportunity to harness technology in a way that is not only valuable to the client, but profitable for the practice,” he said.
Thirdly, Pipe said that new bookkeepers should decide whether they want to focus purely on bookkeeping or to also offer more accounting and advisory roles.
“A narrower definition of a bookkeeper is absolutely fine and there are real opportunities there, but what I would do is to forge strong, strategic alliances with accountants who I can refer work to…and to set those up as reciprocal arrangements,” he said.
Collaborating with high quality accountants who could complement your services with their own advisory work while also referring their clients to you is one way to “supercharge the growth of your firm,” said Pipe.
Recognise your realistic limitations when it comes to workload
Expanding your client base
New bookkeepers should also take advantage of technological advances to expand their client base, Pipe advised. “You’re not restricted to clients in your geographical area, and so think much bigger.
“Think about how you could reach clients much more widely…for example, marketing tools like webinar where people can attend the webinar from anywhere in the country or indeed anywhere in the world, and if they like what they see then they can become clients,” Pipe suggested.
Diversify your staff
The same principle can also be applied to hiring staff from a wider and more diverse talent pool that is not restricted to one geographical location, Pipe added.
“Historically if you were going to build a business and you had to recruit someone who is close enough to come to your office and sit in the room with you and that’s the old model,” he said.
“But actually I’ve been talking to accountants and bookkeepers who have virtual teams spread out across the world and if one of them decides to emigrate to India then they can still work in the business because technology means that they can continue,
“So the talent that you can tap into is much wider than people who can drive to your office and that way you’re able to find better people.” Pipe continued.
Working virtually saved on office costs, argued Pipe, as did hiring professionals on a project basis rather than by the hour.
“So what’s happening is that the practitioner has much lower fixed costs on the office, overheads and fixed hours. What they’ve got is entirely variable costs and that’s so much easier,” he said.
You end up with, “modern ways of marketing, modern ways of recruiting, modern ways of paying people, modern ways of delivering services and technology,” he said in summing up.
What not to do
Equally important when you’re starting out is to know what not to do. Paul Cain, from Cain & Beer, offered several cautionary tales and traps to look out for from his own personal experience.
“Never compromise on the price. Once you’ve got your price and it’s a fair one – obviously by researching the market – never compromise,” Cain advises.
“I think when you start out, not necessarily even in bookkeeping, but when you start out in business, you’re prone to just accept everything that comes through the door in terms of work. I know I did. If someone haggled my price I would come down, and to be fair I think that undervalues you.”
Not being afraid to say no, and to recognise your realistic limitations when it comes to workload, is another nugget of advice he offers those at the outset of their careers.
And finally, be firm on payments, Cain argued. “When you’ve done one bit of work insist on payment before you start another piece of work.”
After one bad experience early in his career he quickly learned to negotiate ahead of time.
“We agree the terms up front, and as part of those terms are the payment terms. We agree what’s fair,” he said.
“In our case we want to be paid within seven days so the client understands that and knows that if he doesn’t pay us within seven days we don’t do any more work for him,” Cain said.
“That minimises our exposure to being knocked and it also allows to take on other people’s work who are going to pay us.”
Nicola Smith has spent a decade reporting for The Sunday Times on both the European Union and South Asia.