Aug 8

Aug 8 Bookkeepers Need To Establish Their Value

When I was 14, I got my first job as a bookkeeper.

It was a summer job. Someone at the office where my mom worked had quit suddenly, so they needed help. Yes, when everyone else was at the pool getting sunburns, I was in an office from 9 to 5. I was paid minimum wage, which at the time was $4/hour. On Saturdays, I came in and helped clean the office. Cleaning the office paid $5/hour.

This is when I realized too many business owners don't value bookkeeping.

It's not because I think bookkeepers are "above" the cleaning staff. It's because it was a deliberate decision by the owner. They didn't have an hourly rate set for a cleaning staff or a 14-year-old accounting clerk. No one else at the company was paid minimum wage. It was a statement that bookkeeping was the work he was willing to pay the least for.

Since this was just the first of many such experiences, I couldn't just blame the owner.

Since I know there are solopreneurs and small business owners reading this, I know this isn't all owners. My current clients all understand how important good financial data is for making informed business decisions.

The underlying problem is an issue of perception. Look at an income statement. The owners I'm talking about view anything above the words "Gross Profit" as valuable and anything listed under Operating Expenses as necessary evils.

Revenue is king. The product and those selling the product are at the top. Coffee is for closers.

The philosophy is simple. If it doesn't directly bring in money, it's hurting the business.

The reason I started to see a change was by accident. I was working with a client almost a decade ago. I was preparing the monthly financial reports. The process was the same each month.

Prepare the reports.
Email the reports to the client.
Offer to set up a meeting to discuss any questions the client had.
They would glance at the report (maybe) and let me know a meeting wasn't necessary.

I noticed that Xero had added a feature where I could add notes to the bottom of the report. On a whim, I decided to add my observations. I noted how revenue in a certain category had been dropping. I highlighted some expenses that seemed unusually high. Nothing too exciting.

It turns out I was a big part of the problem.

I got an email back with a large list of follow-up questions. They were very interested in digging into my observations. Then came requests for additional analysis, which meant more work. The analysis and my recommendations were discussed, and changes were implemented.

The owner was getting my reports each month but didn't really know what to do with them. They knew the reports were part of running a business but didn't know what to focus on or what questions to ask.

We both made assumptions.

I assumed, as the owner, that they knew everything about their company's finances. I assumed their lack of follow-up questions was a lack of interest in the data.

They assumed all bookkeepers did was the bare minimum for the sake of compliance and tax preparation. They assumed I wouldn't be able to provide strategic guidance that could actually help grow their business.

You need to show and prove your value.

If you provide a specialized skill, don't assume the client knows what you do. This is especially true for short-term or contracted work. You won't be part of the day-to-day office life, so it's even less obvious what you do or what value you bring.

They may have hired you to do X. X is all they know a bookkeeper does. If you also offer Y and Z, they won't know unless you tell them.

Offer them a sample of what else you can do. Show them the value you can provide and how that can make a direct impact on the success of their business.

Not everyone will want it. That's fine. The benefit of growing is you can start picking who you want to work with.

What do you think?

Have you encountered this in your business? If you have a good story to share, contact me and let me know. I love hearing from you. Running a business solo can make you feel like you're on an island. Hearing your similar (or contradictory) stories is always welcome.