How To Start A Virtual Bookkeeping Business

how to build a bookkeeping business

By presenting your pricing and service options in a second meeting, you’ll be able to engage in a discussion around picking and selecting the right option for your client. Next, set up a separate meeting to present the 3 service options you’ve created to your client to be rather than just blindly sending a proposal. With this interaction, you have uncovered a pain point, which then increases the value of what you’re offering making it easier to get clients. Now you need to find new clients with a simple, repeatable sales process. The bad thing about Google and Facebook ads is that they can be super expensive and the traffic you get may not be the traffic that you want. Which means you would end up with the wrong kind of bookkeeping clients.

At the end of every pay period, the bookkeeper will accumulate employee payroll details that include hours worked and rates. From there, the total pay is determined with the applicable taxes and withholdings. In the accounting software, the primary journal entry for total payroll is a debit to the compensation account and credits cash. Accounting software can streamline your bookkeeping process and make your financial management more efficient. It’s useful for business owners looking to save time and avoid common accounting errors.

What is virtual bookkeeping?

Bookkeeping, as it turns out, is one of the best online businesses you can start. I’m an entrepreneurial CPA that founded Xen Accounting, a

100% cloud-based accounting firm, in 2013. Following its acquisition in 2018,

I started Future Firm to help accountants fast-track the growth of a modern, scalable accounting firm of their own.

  • There are two pieces of the business plan that deserve a little extra consideration.
  • It’s also helpful to understand how to market your services and manage the financial side of running a business.
  • Unlike the requirements to become an accountant, the training required to become a bookkeeper is less strenuous.
  • When you feel you have enough education, you can begin applying for jobs or start your own bookkeeping business.
  • The golden rules also help ensure that your bookkeeping is accurate and up-to-date.

Don’t forget that investing in your business means investing in yourself. Certification is also available within certain software products, too — for instance, you can get certified in QuickBooks. For example, if you prepare and post an invoice in the amount of $150 to John Brown for consulting, you’ll need to record that information in a journal entry. You can also use financial ratios here to dive deeper into your profit and loss statement. Your income statement shows you how much your business is earning and spending and, ultimately, what your bottom line is.

Do your research and create a business plan

Double-entry accounting enters every transaction twice as both a debit and a credit. Your business’s books are balanced when all of the debits equal (or cancel out) all of the credits. Although it’s more complicated, it can prevent bookkeeping errors. And since it takes equity, assets and liabilities — on top of expenses and income — into account, it typically gives you a more accurate financial snapshot of your business. For professionals and aspiring bookkeepers alike, certifications are a powerful way to boost your skills and add additional authority to your brand.

how to build a bookkeeping business

Finally, subtract your total expenses from your total revenue to get your bottom line. Cash is always listed first, followed by the rest of your assets, based on how quickly each asset can be converted into cash. For example, a loan would go under liabilities since you’ll have to pay it back later. Amounts owing on credit cards, funds that need to be paid to vendors, or payment terms on a vehicle or item of equipment you purchased also count. Assets refer to anything physical and non-physical that your company owns.

The Pros and Cons of Starting Your Own Bookkeeping Business

When people talk about virtual bookkeeping, they are usually referring to online bookkeeping services. Or an outsourced contractor that helps with monitoring individual accounts, filing taxes, and preparing financial statements, and more. Fortunately, small business owners don’t need to be experts in mathematics to find success when doing their own bookkeeping. There are many ways to divide bookkeeping responsibilities and leverage powerful technology and small business accounting software for more accurate expense tracking. Bookkeeping is the regular practice of updating a company’s financial records to reflect all financial transactions, credits, and debits.

If you love numbers and organization, bookkeeping could be right for you. Pay.com offers all of the above, making it simple for your clients to pay for your services. In just a few clicks, you can set up your payment system via the Pay Dashboard – no technical experience required. The last and most important piece of your business infrastructure is your payment system. A good payment system will provide you with a full payment infrastructure, meaning you get a payment gateway, merchant account, and payment processing services. Every business needs a bookkeeper, so you have a wide variety of customers to choose from.

Perform Journal Entries to Debit and Credit Accounts

It also lets you get to know them better and work in a more personal, intuitive kind of way. This helps you keep clients files organized, protected, and backed up on a cloud you can access from anywhere. Of course, if you have the budget, you can always hire a service to make one for you. There’s a small learning curve how to build a bookkeeping business for WordPress, but once you get the hang of it, you can turn your business site into anything you want. Missing deadlines, inefficiencies, and lack of accuracy can plague on-site bookkeepers — but not you. Here’s the beauty of being a remote bookkeeper; you can also work with almost any type of small business you want.

Before starting a bookkeeping business, you’ll first need to know the basics of operating legally. It’s also helpful to understand how to market your services and manage the financial side of running a business. You will likely want to establish a business banking account and credit card.