The manufacturing industry is complex and constantly fluctuating. Between managing supply chains and predicting market shifts, a manufacturing CEO already has many different responsibilities on which to focus.
That’s why, according to Business Research Insights, more than 40% of manufacturing companies now choose to outsource their accounting departments.
There are several reasons why a manufacturer would want to switch to outsourced accounting. Along with obvious benefits like cost reductions, there are some lesser-known boons to outsourcing your company’s accounting functions. Here are just a few key benefits.
1. Financial Management is Crucial
If you’re a manufacturing CEO, there’s no doubt that you’re aware of the intricacies of the industry. Manufacturing is a fast-paced industry, and careful financial management is crucial for a company to succeed.
Because of that, highly skilled accountants can be the difference between success and failure in the manufacturing industry, while an in-house accounting team can hit this mark, the cost of internal salaries, benefits, and training can certainly add up—and that’s not even mentioning the hiring process for highly specialized financial roles.
2. Access to Specialized Expertise
Like manufacturing firms, accounting companies are highly specialized entities staffed with experts in their field. Outsourced accounting allows any type of company to tap into a pool of highly qualified finance professionals with a wealth of experience managing unique clients.
Because of this specialization, you can expect your accounting company to keep ahead of regulatory compliance, tax optimization, and expert insights into managing your business’s costs. This offers your manufacturing company a good deal of flexibility since your accounting firm can help adapt your company’s finances on the fly.
3. Frees Up Internal Resources
As mentioned earlier, highly skilled accounting professionals are expensive to hire and retain. For a manufacturing company, these costs could instead be used as funding for production, supply chain management, and quality control.
By outsourcing your company’s accounting functions, you’re freeing up valuable time, bandwidth, and internal resources, which you can then put into innovation and production. After all, your company was built on manufacturing — so it’s best to lean into your expertise.
4. Reduces Risk of Internal Errors
The intricacies and complexity of the manufacturing industry mean that errors are common — and they can certainly add up. This is especially true if you’re relying on a small and in-house financial team. Even the ideal accounting department can make mistakes, but a highly specialized firm is much less likely to put your company at risk.
Outsourced accounting companies follow extremely strict protocols and regulations. They also have access to highly advanced software that helps to ensure the total accuracy of your books. All of this is to say that your outsourced accounting firm will help reduce financial risk overall.
5. Ensures Timely and Accurate Reporting
Getting accurate and high-quality data in a timely manner is crucial to making strategic financial and business decisions, especially in manufacturing. However, small teams often have a much harder time meeting tight deadlines — especially if they’re burdened with other routine tasks in your company.
As mentioned, outsourced accounting firms are highly specialized operations, and they almost always have highly specialized reporting processes. Between advanced software and a full team to review and audit data, an outsourced accounting firm is much more likely to provide you with the financial reporting that you need to make better decisions.
Outsourced accounting may be the future of manufacturing finance.
If you want an accounting department that mitigates risk, delivers accurate reports in a timely manner, and can help update your financials on a dime based on changing outside factors, you probably want an outsourced accounting firm.
Between the benefits explored above and the potential cost-savings, switching to outsourced accounting — and especially accounting provided by a top firm like TGG-Accounting.com — is often a no-brainer for many companies.
Whether your company wants to invest in innovation, maintain current growth, or simply get off the ground, an outside accounting company can be a powerful partner in your firm’s success.