Where Entrepreneurs Should Invest their Money First

Posted by Heather Villa, CMA, MBA, MSM on September 29, 2009 in: Bookkeeping & Accounting, Business - Plain & Simple

Knowing when to invest into your small business, and knowing what you should invest in, is not easy. Entrepreneurs have a myriad of opportunities vying for every single investment dollar. Should you buy this tool? Should you buy that software? Should you hire staff?

One investment that gets overlooked early in the business (and is usually invested in much later down road) is an accountant. Early in the life of the business, the entrepreneur might just use pen and paper and a shoebox to do their financials. Then later, they might invest in computer-based or web-based bookkeeping software. And later, perhaps they might bring an onsite or virtual bookkeeper on board.

There is some advantage to using the computer-based or web-based software… if the business owner has the time to input the numbers themselves (or if they have an assistant who can do it for them). And, there is some advantage to hiring a bookkeeper to take care of the books. Either of these two options is a good, lower cost option (and definitely superior to the “shoebox” method). The advantage, of course, is that the software or the bookkeeper can bring some order and structure to the business’ financials.

While the software and the bookkeeper are investments into the business owner’s sanity, the accountant is actually an investment into the business’ longevity and profitability. That’s because a bookkeeper, like the software, is just about maintaining order but an accountant is about developing insight and uncovering opportunity.

A bookkeeper will punch the numbers on the calculator and deliver nice, clean books to you. An accountant will deliver your books to you and point out where you can lower expenses, how you can raise revenue, what growth opportunities exist, and what challenges you’ll face in the near and distant future. As well, they’ll help you through the complex process of taxes.

(Now, I should note here that this article is NOT disparaging bookkeepers. They have an invaluable role in an organization and they can bring a certain level of helpful insight to the business owner. However, the accountant is certified to deliver more insight in more ways.)

So, what should you as a business owner invest in? Early on in your business you should consider a bookkeeper or some bookkeeping software, just to keep the books in order. But as early as possible you should consider bringing in an accountant who can deliver the insight you need to grow.

About the author: Heather Villa, MBA CMA MSM, is a Business Coach and Entrepreneur. She helps business owners achieve success in operations, productivity, project management, and social media. Read her other articles at http://hireheathervilla.com/resources/articles/ and visit http://heathervilla.com for more information.

Disclaimer: © 2009 Heather Villa. Permission is granted to repost this article. Article must be published in its entirety, including author bio, and all links must remain intact.

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I love working with coaches, freelancers, and entrepreneurs to help them become more successful. If you'd like to improve your business, find out how I can help.

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