Bookkeeping is one of the most necessary parts of any business, and yet several companies would rather outsource the work than hire someone to do it in-house. Thus, the market for independent bookkeepers and bookkeeping services is always making room for new opportunities. This is also a fairly simple business to get started, although you’ll need to eventually think about things like professional certifications and other training as you grow and build your business. But we’ll get to that later.
First, we will discuss the basics of how to start a bookkeeping business and what certifications and licenses you need. Then, we’ll go over actually setting up the business so that you can get to work and start making a profit by helping others with their bookkeeping needs.
Technically, there are no real requirements to be designated as a “bookkeeper”. You can choose to get an accounting degree, become a CPA, or seek other financial licensing or certification to bolster your business reputation, but it’s certainly not required. Bear in mind, you may be limited on the clients that you can serve as a bookkeeper without a professional designation, but this is generally not an issue.
If you already have experience or education, you will be ready to get started on your business. However, if you want to build your credibility or seek out some certifications, you could consider things like:
- Certified Public Bookkeeper: Becoming a CPB is an option through the National Association of Certified Public Bookkeeping (NACPB). This license will prove that you are properly skilled in QuickBooks, payroll processing, accounting, and bookkeeping principles. You’ll need to take a four-part exam, provide verifiable experience, and agree to a code of professional conduct.
- Certified Bookkeeper: This is a certification available from the American Institute of Professional Bookkeepers, and it is also nationally recognized and includes a four-part exam.
- QuickBooks Certification: You can choose to certify in QuickBooks as a way to provide your clients with a little additional confidence in your abilities if you don’t want to go for full certification. There are in-person training sessions and online classes, and an exam will be required.
The Tools You Need
In order to start a bookkeeping business, you’ll need some essential elements. A business license is the first thing to get, and the one that you need depends on the type of business you intend to do. Be sure to check with your local business regulations to determine what’s required.
You will also want to invest in professional liability insurance to protect yourself just in case a client has an issue and tries to bring a legal case against you. Even if you’re the best in the business and you are diligent, mistakes happen. That’s why insurance is a good choice.
When you’re setting up as a bookkeeper, you’ll also want to make sure that you have a good, reliable computer that’s designed for business use. Invest in premium security and storage solutions that will keep client data organized and safe from intruders or data loss. You’ll also want to choose the best software for accounting, document collection, and antivirus protection.
Funding Your Business
If you’re just starting out in business, financing is one of the biggest considerations. Of course, starting a bookkeeping business can be a minimal investment if you choose to work out of your home and only need to invest in office equipment. If, however, you want to open up a physical office, you’ll need to be able to afford to rent, furnish, and pay the utilities for a space. Fortunately, the Small Business Association and other resources exist to help you along the way.
There are several ways to finance your business, and plenty of options for starting a more affordable business so that your expenses are minimal at the beginning. Then, in a couple of years when things improve, you may be able to invest in scaling up and doing something bigger if things are going well.
Setting Up the Business
Aside from incorporating your business, you’ll need to select a name that you can use as a professional image. You should choose something other than “John Smith Bookkeeping” so that your clients can remember your name and so that you do create that professional image. Choose something simple, clear, and effective that will get your message out there and help you build a brand.
You’ll also want to choose a structure when you incorporate, whether that is any of the four common options:
- Sole proprietorship
- Limited Liability Company (LLC)
Working with a business lawyer, or at least consulting one that understands starting a business, will help you make the right choice as to which business structure is right for your needs.
Don’t forget to set up a business bank account, business mailing address, and create business listings on online directories that will allow people to have a way to contact you. You’ll need to market your business via social media and other means, but even just listing yourself online appropriately can attract a lot more business than you might think.
Get Started on Your New Bookkeeping Business
If you’ve been looking for a different way to put your bookkeeping skills to work, this might be just what you need. Check into the resources available in your state and remember to consult a legal professional that knows about starting a business to ensure that everything is in order. You can even check out local resources for advertising and referral programs to help you build your brand once you get things off the ground. If they say that marketing is half the battle, “they” have never dealt with starting a business. Although it doesn’t have to be difficult, it does take work. With the steps in this guide, though, you’ll be building success in no time. Whether you are looking to go independent or start a full bookkeeping firm, you’re already well on your way.