The world of online bookkeeping services have brought a handful of different options to entrepreneurs. You would think that they're all they same, but in reality, there are three different types of online bookkeepers out there. If you're thinking of going this route to get help with your company's accounting needs, make sure to read this post to get the best solution.
Think of online bookkeeping services as a term that describes different models; much like the word "car" would encompass a sedan, a sports car, and a compact. With that in mind, let's look at some of the models.
#1 - USA based online bookkeeping companies
Companies like Ignite Spot fit in this category. Here, you're working with a company that's based entirely in America. They have actual employees, a track history, built processes and tools, and operate like a business. That means that they have operating hours and will send you an invoice for services rendered. They will have a strong structure in place for training staff, providing customer service, and they will also have the kinds of protections you would expect to have when working with a USA based company. For example, they will have insurance that you can rely on if something unfortunate happens with your account.
#2 - USA based stay-at-home bookkeepers
Because it's so easy to build a website these days, many online bookkeeping services are an accountant working from their home. There's nothing wrong with this model, and it can be a great way to save a little more cash. This kind of solution will usually charge a bit less because they don't have overhead. However, one thing to be aware of is that these accountants can get bogged down easily. Since they're in charge of all the work, marketing, and business administration tasks, they can get flooded and overtime your account may not get as much love as it did in the beginning.
#3 - Offshore bookkeepers
I'm seeing fewer of these solutions pop up lately. True, this option is cheaper than hiring a USA based firm, but as you can imagine, there are some drawbacks. Communication is usually more difficult and the response time is usually longer. Security is also an issue given that they're handing your finances. We've had many companies come to us after using this type of solution due to a poor handling of their books. However, I've seen this work on occasion.
I hope this helps as you begin shopping for the kind of online bookkeeping services that will support your business. Every company has a different set of goals which means that any of these options could be a good fit for you. Just consider the pros and cons before you move ahead. Feel free to ask questions below and I'll be happy to answer them for you.