If you are unsure about outsourcing billing services, then this post is for you. We love outsourcing billing services, but before you choose to do the same, you need to weigh the pros and cons. Sometimes, it’s wise to outsource certain billing tasks, but not others. We’ll go through the main ones, and the costs of outsourcing them, to help you decide if this is a good solution for you.
What Are the Top Billing Services or Tasks to Outsource?
You might want to outsource some billing services, but not all. Below are the most common billing tasks that we think are best outsourced.
Invoice generation
Creating invoices can actually be automated for the most part. This is especially true for subscription billing. What you want to outsource here is setting up clients on your invoicing system, and checking invoices for errors. An assistant can enter the details of each client into your system for you.
This is basically data entry work, and you don’t need to spend your time on it. Just look for someone who has experience with your software and an eye for detail. Before invoices go out, have them check that each draft is free of errors. They can make any needed adjustments, too.
Payment processing
Like invoicing, payment processing can be mostly automated. Once an invoice gets paid, you can have an assistant verify the amount and the transaction. Most invoicing and outsourced accounting software tools have the option to note payment details. Just make sure that you are hiring someone who cares about accuracy.
For outgoing payments, you can still outsource manual payments, but be careful. You must know that you can trust the person you are giving access to. Make sure that you have all the possible bank account safeguards in place.
Accounts receivable / payable management
Outsourcing billing services like this to a bookkeeping virtual assistant is a great idea. A bookkeeper knows exactly how to balance these items. They will be able to help you manage it and avoid falling behind.
You don’t want to end up ruining vendor and supplier relationships because you forgot to pay. Even worse, you might not have enough money because you didn’t follow up on payments due to you.
Data entry
A lot of billing tasks are actually data entry work, like entering client information, financial details, and keeping records. You can hire a bookkeeper to keep all of this sorted out.
A bookkeeper knows how to handle all of this data. That does not only mean what needs to go where. They know all about keeping sensitive information safe and making sure that the details are entered accurately. Accounting does not allow for mistakes!
Payment reconciliation
Payment reconciliation is another accounting task that makes outsourcing billing services sound like the best idea ever. This accounting process involves verifying account balances to make sure that all the details in different sets of records are accurate and match up. That’s not a task that most people would enjoy, or be able to manage.
Maintaining records so they stay updated, true, and consistent takes an eye for detail and a love for accuracy that not all people have. Whether you choose to do it daily, weekly, or monthly, you can use some help. The tediousness of this task can lead to mistakes, and you don’t want that. Payment reconciliation helps you avoid missing or failed payments and deposits, reporting and tax errors, and identify fraud.
Credit control
Sometimes, allowing customers to purchase on credit can make you more popular. As you promote more sales this way, however, you must stay on top of all the payments due to you.
The credit control process helps you track the credit period, the payment terms you offer each customer, the credit standards, and your debt collection policy. It can also keep track of any cash discounts you offer to customers who opt to pay up front.
Attractive payment terms can boost profits, but only if you make sure you are getting paid. Start with hiring someone who knows how to check customers’ credit history so you know who you can reliably extend an offer to.
Billing statement preparation
If you need to provide a customer with an overview of their account activity with your business, an assistant can help. You are most likely not that keenly familiar with every client’s transaction history with your business. And you don’t need to be.
First, you will want someone who can make sure that all these transactions records are properly compiled and stored in case any customer asks for a billing statement.
Then you will have them ready at a moment’s notice. This builds customer trust and loyalty. If you like, you can even have an assistant send these statements out regularly. The same assistant can also help you manage your billing cycle.
Customer billing inquiries
One thing that can really eat up a lot of your time is answering questions. When you hire a bookkeeper or other financial account assistant, they can take over customer inquiries. Every time someone calls or emails with a question, you have an assistant at the helm. This person is properly equipped to give the right answers about their invoice, subscription, change in payment method, etc.
Expense tracking and billing
Another potentially tedious yet vital task, expense tracking is best outsourced. You need to have a record of every single expense your business has. This not only helps you with your taxes, but also gives you a clear and detailed picture of your budget. This way, you can understand what changes you should make to become more profitable.
An experienced assistant can help you decide whether to make adjustments to fixed expenses like rent and utilities, or to fluctuating costs like labor and advertising. Without this, your budget will not accurately reflect what you’re spending, ans possibly wasting.
Refund processing
No business likes to think of issuing refunds. Not only do you have to return someone’s money, but you incur added expenses. You already spent a bunch making that sale, and now you have to spend more reversing it. This hassle can make you ignore the refund process, which is a bad idea.
Customer satisfaction is so important, and refund processing is one of its more vital aspects. With an experienced assistant, you can optimize your refund process so it’s not abused, runs smoothly, and keeps customers happy.
What Are the Pros of Outsourcing Billing Services
1. Cost Savings
You save a lot in general when you hire from overseas. Because most billing tasks are online anyway, you don’t need anyone in-office to do most of the work. The possible language barrier isn’t even an issue for the most part because bookkeepers generally don’t talk to your customers.
2. Expertise and Efficiency
When you outsource, you are hiring from a global talent pool, not just the people who live in your vicinity. This gives you the best chance of finding the perfect fit for your needs. You can more quickly and easily get the right balance of skills, availability, and even personality when you hire globally.
3. Focus on Core Competencies
Most businesses don’t need full-time help with billing tasks. This tempts most business owners to do them, or ask another team member to take care of them. That is not a good idea, though, because it takes you away from what you do best. You will not do the tasks as well as a specialist would, for one thing. In addition, you might make mistakes because you don’t enjoy the work.
4. Scalability and Flexibility
When you outsource billing tasks, you can hire someone for as many hours as you need. This can easily change month over month, or even week over week. With freelance help, you pay only for the time that they actually spend working. You can get more hours or cut back whenever.
What Are the Cons of Outsourcing Billing Services?
1. Loss of Control
You are trusting another person with your finances when you outsource billing. However, you can put safeguards in place so you don’t get burned. Data security is one major concern. Contact us for help in this area!
2. Quality and Customer Relations
You might think that you can do everything better than anyone else. Most business owners do! While you might be right, the truth is that it’s still not worth your time to do everything. Focus instead on looking for expert help and building strong teams that learn and grow with you.
What Is Outsource School?
Outsource School helps you to unlock the potential of virtual assistants and accelerate your business growth.
This is the exact system Outsource School’s founders, Nathan Hirsch and Connor Gillivan, used to go from zero to 8 figures and 40+ virtual assistants with an exit in 2019.
Since being founded in 2020, Outsource School has helped 1,000+ business owners hire 2,000+ virtual assistants for their companies.
Schedule a free sales call to learn more
Free resources you might like:
- Outsource School Case Study: How We Scaled to 45+ VAs and 8 Figures in Revenue
- Free VA Calculator | See How Many VAs You Can Afford
- Free Training on 5 Keys to Working With VAs
- Learn Outsourcing 101 | Guides, Downloads, and Checklists
Conclusion
We hope that this post helped you to decide whether outsourcing billing services is a good option for you. The Outsource School founders have certainly found it to be beneficial in their businesses! We want to make sure that it’s the best choice for your business, too.
