You’ve managed to make it through the early stages of start-up. You have a solid product, you’re generating revenue, and your future looks bright. But no matter how well things are going in other areas of your business, there’s one place where they will always be difficult—bookkeeping.
There are just too many moving parts in any hotel operation to do bookkeeping well at the same time that you are running the rest of the show. And if that wasn’t challenging enough, adding up all these minutiae on a daily basis is probably not what utilized your college degree anyway, so hiring someone internally can seem like an impossible task when faced with everything else on your plate.
Fortunately for hotels looking to take back control over this aspect of their business, there is a solution. By outsourcing your hotel bookkeeping needs to an external service provider, you can relieve yourself of one of the biggest headaches that comes with running a small business.
Before hiring such a company, however, it’s important to understand what they do and how they can help. Here are the five most common tasks handled by an outsourced service provider:
Daily Number Crunching
The first order of business for any new business is to forecast where you stand financially and determine how much money you need to keep the operation running smoothly. Of course, predicting revenue and expenses (and all of their associated variables) for a hotel will always be somewhat imprecise, but having this knowledge on paper enables you to make better decisions moving forward and will determine the overall success of your business. This is why hotels need their outsourced service provider to provide this information for them, or at least to help them create a forecast themselves.
An outside bookkeeping company will be able to pull pertinent data from your financial records and turn it into something digestible for you, all while keeping an eye on ways to cut back on expenditures if necessary.
Daily number crunching cannot only keep all of your numbers straight but also makes sure that your revenue stays where it should be. When it comes time for tax season, this knowledge can also serve as a cushion against any potential penalties the government may want to levy against you. Finally, daily number crunching gives you insight about new sources of income and helps you plan for the future.
The second task assigned to an outsourced service provider is reconciliation. This important step takes place after number crunching and involves looking at your bank transactions for any discrepancies between what you think should be there and what actually turned up during your monthly statement run.
If you are managing this portion of hotel bookkeeping yourself, it’s all too easy to mix up some numbers or forget to include one here or there. When this happens, reconciliations ensure that everything balances out—or if not, explains why not—and accounts for every penny in the books.
One of the biggest perks of outsourcing hotel bookkeeping is that your outsourced service provider will handle goal-setting on a daily basis. You have to run your hotel first and foremost so it’s nice to be able to rely on someone else for these decisions.
Your outsourced service provider will create reports with recommendations on what you can do today to increase revenue or reduce expenses—some of the simple suggestions may even seem ridiculous but they are all there for a reason, some more obvious than others. Their insight into your financials is based on years of experience working with other hotels just like yours so don’t brush them off as some novice bookkeeper giving haphazard advice.
Daily reporting also ensures that future forecasts are accurate by making sure you are sticking to the same schedule day in and day out. Although daily forecasting can be tough, it’s important not to stray too far from previous forecasts or your future projections will be all over the place. Daily reporting keeps things on track and reports back to you what you need to know, when you need to know it.
The final task an outsourced service provider is responsible for is monthly reconciliation and reporting. This larger-scale version of daily reconciliations resembles number crunching except that it’s better suited for reviewing financial results over a longer period of time rather than just one day. For this reason, monthly reconciliations are more about forecasting than they are about troubleshooting problems like daily reconciliations are—and instead of taking place each day, should take place at least once per month so that nothing gets overlooked due to oversight or carelessness.
A monthly report will also include both a review of the month that just ended, as well as recommendations for improving revenue and reducing expenses in the future. With all of this information at your fingertips, you’ll be able to make far better decisions about how to grow or maintain your business because you will have a complete snapshot of where things stand today and where they need to go tomorrow.
Ideally, this month’s report will include a review of the month that just ended, as well as recommendations for ways to improve revenue and reduce expenses going forward. With all this information at your fingertips, you’ll have a complete snapshot of where things stand today and how to move them towards tomorrow so that your business can constantly grow and adapt with changing market conditions.
In short, when it comes to outsourcing hotel bookkeeping services these three tasks are all key parts of owning a successful hotel—in fact, the more an outsourced service provider does for you, the better equipped your business is going to be over time.
Depending on which option is right for your needs, an outside source can offer many different types of assistance but the primary three are reconciliations, daily reports, and monthly reports—all of which should be done on an ongoing basis so that your business is always running smooth.
With all this information at your disposal, you can see why outsourcing is guaranteed to ease the weight of daily bookkeeping. An outsourced service provider is there to handle goal-setting on a daily basis so that you have more time to run your hotel. Finally, an outsourced service provider will also handle monthly reconciliations and reporting so that you can get a better sense of where things stand today and figure out what needs to change tomorrow in order for your business to grow.
The clear benefits are obvious but knowing what each task comprises can make it easier for you to choose which type of outsourced solution best suits your needs as well as whether or not their services are worth the money. With all this extra insight into what each task entails, you’ll find yourself better suited to handle everything that’s asked of you—whether it’s in-house or outsourced.
A quality outsourced service provider will give you the best of both worlds: they will take over your daily bookkeeping, monthly reconciliations and reporting so you can focus more of your energy on growing the business.