Starting a bookkeeping business can be a lucrative and fulfilling venture, but it takes careful planning and execution to get started on the right foot.
Here are the 10 steps you can take to get started on building your very own bookkeeping business.
10 Steps to Launching a New Bookkeeping Business
1. Choose Your Type of Bookkeeping Business
The first step in launching a bookkeeping business is to identify the type of bookkeeping business you want to launch. You might choose from the following types among others:
- Payroll services
- Accounts payable/receivable
- Bank reconciliation
- Tax preparation
2. Name Your Bookkeeping Business
Give your bookkeeping business an identity so people will think of it as a well-known and respected brand. You can take the name of your bookkeeping business from your industry, focus on a geographical location, or use your own name among other options.
The main goal for naming your bookkeeping business is to make it sound appealing and trustworthy so that clients will want to do business with you.
3. Determine Your Bookkeeping Business Model
There are several possible types of business models for a bookkeeping business including:
- Business to business (B2B): You’ll be working with other businesses to provide bookkeeping services.
- Business to consumer (B2C): You’ll be working directly with individual consumers to provide bookkeeping services.
- Online: You’ll be providing bookkeeping services online through a website or other digital platform.
- In-person: You’ll be providing bookkeeping services in person to clients in your local community.
- Mobile: You’ll be providing bookkeeping services to clients who are not located in a traditional office space. The type of business model you choose for your bookkeeping business will depend on your target market, the services you offer, and your own preferences and skills.
No matter which model you choose, make sure that it aligns with your business goals and the services you offer.
4. Choose a Legal Form for Your Business
By incorporating your bookkeeping business, you will limit your liability. You can incorporate as a Limited Liability Company (LLC), a C Corporation (C-Corp), or an S Corporation (S-Corp). Or you can operate as a sole proprietorship.
The business structure you choose for your bookkeeping business will determine the amount of taxes you pay and which state or federal tax forms you need to file.
Read our article comparing the most common bookkeeping business structures.
5. Write a Bookkeeping Business Plan
All bookkeeping business owners should develop a business plan.
A business plan is a document that outlines the goals, strategies, and operations of a business. It can be used to secure funding from investors or lenders, as well as to guide the day-to-day operations of the business. The business plan should include information on the company’s products or services, market analysis, financial projections, and management team among other things.
Read our article about how to write a bookkeeping business plan.
6. Apply for the Necessary Permits and Licenses
There may be required licenses and permits you need to obtain before launching your bookkeeping business.
For example, if you plan to provide bookkeeping services to businesses in your state, you may need to obtain a business license from your state government. You can usually apply for this license online.
If you plan to operate your bookkeeping business out of a physical location, you may also need to obtain a zoning permit from your local government. This permit will allow you to operate your business from a specific location.
You must also register your bookkeeping business as a legal entity with the state where you plan to do business. You can simply file an online form through your Secretary of State website.
Registering with the federal government is also essential so you can properly pay taxes for your business. You will also need an Employer Identification Number (EIN), which you can apply for at the IRS website, if you plan to hire employees.
Read our article about obtaining the proper bookkeeping business licenses.
7. Determine Your Budget & Apply for Funding as Needed
In developing your bookkeeping business plan, you will figure out how much funding you need to start and grow your business.
If you have your own funds to invest in your bookkeeping business, you may consider taking advantage of that. In addition to your personal funds, other forms of potential funding for your bookkeeping business include traditional bank loans, SBA loans, credit cards, angel investors and family and friends.
Read our article about the costs associated with starting a bookkeeping business to help you determine if funding is needed.
8. Get the Technology & Software Needed to Run Your Business Efficiently
When you start your bookkeeping business, it’s essential to have the right technology in place to maximize efficiency. You definitely need a computer with Internet access, and accounting software for tracking expenses and revenues.
You may also want to invest in additional software to help you manage your bookkeeping business. For example, project management software can help you keep track of deadlines and progress for each client. And, time tracking software can help you bill clients accurately for the work you do.
Read our article about the technology and software you need to run a bookkeeping business.
9. Market Your Bookkeeping Business to Potential Clients
Before you start selling your services, you have to let the world know you exist. The first step is to create a website so people can learn more about your services and how they benefit them.
After you launch your website, start promoting it through social media channels like Facebook, LinkedIn and Twitter. Also consider networking with other people in the bookkeeping industry through social media and blogs so they can help share your business.
You also need to start gathering the materials needed to execute on your promotions strategy, which is your strategy for attracting new customers. Bookkeeping businesses should consider the following promotional strategies for which you should start getting prepared:
- Direct mail campaigns
- Email marketing campaigns
- Networking events
- Sponsoring bookkeeping industry events and conferences
- Door hangers
Read our article about how to market your bookkeeping business for more tips.
10. Get New Clients & Grow Your Business
When you promote your services, you’ll start to get interest from potential clients.
Make sure you’re ready to serve these clients. Also, be sure to establish systems to ensure consistency and reduce costs. And be sure to find and train the right people to help you grow your bookkeeping business.
Read our article about how to effectively grow your bookkeeping business to learn more.
Starting a Bookkeeping Business FAQs
There are many reasons to start a bookkeeping business. It’s a great way to be your own boss, set your own hours and work from home. And, if you have experience in accounting or finance, it can be a great way to use your skills to help others.
Growth is another big reason to start a bookkeeping business. The demand for bookkeeping services is expected to grow as businesses become more complex and the need for accurate financial records increases.
To start a successful bookkeeping business, you need several things:
- Bookkeeping experience
- The right technology and software
- A well-designed website
- Promotional materials
- The right people to help you grow your business
Starting a bookkeeping business from home is a great way to achieve work/life balance. And, with the right technology in place, it’s easier than ever to do.
To start a bookkeeping business from home, you need:
- A computer with Internet access
- Accounting software
- Other software to help manage your business
- A well-designed website
- Promotional materials
- The right people to help you grow your business
If you will see clients from a home office, obtain the proper permits, such as zoning or home-use permits.
Starting a bookkeeping business online is a great way to reach a wide audience of potential clients. And, with the right technology in place, it’s easier than ever to do.
Establish a website and allow clients to book your services online. Use social media to market your business and connect with potential clients. And, consider using other online marketing strategies like email marketing and pay-per-click advertising.
Here are some tips for starting a bookkeeping business:
- Start by identifying your target market.
- Find the right technology and software to help you run your business.
- Build a well-designed website to promote your services.
- Use social media, networking and other marketing strategies to reach potential clients.
- Gather the right people to help you grow your business.
- Find ways to reduce costs and increase efficiency.
These tips will help you get started on the right foot and set your bookkeeping business up for success.
A simple checklist to use when starting a bookkeeping business is as follows:
- Choose Your Type of Bookkeeping Firm: This should be based on what you are best at and how much experience you have. Remember to keep your interests, skills, and experience in mind at all times.
- Name Your Bookkeeping Business: This should be done with care, as your brand is important for attracting the right customers. A simple, memorable name will go a long way.
- Choose a Legal Form for Your Business: Whether you choose to become a sole proprietorship, partnership, LLC, corporation or another option will depend on your business. Ensure that you are aware of all the implications of each type.
- Determine Your Bookkeeping Business Model: Determine how your business will make money. Will you sell products, services, or a combination of both?
- Write a Bookkeeping Business Plan: Your business plan will also help you determine what your start-up costs will be and will provide a roadmap with which you can launch and grow.
- Apply for the Necessary Permits and Licenses: In most locations you will be required to apply for a business license and/or permits before you can begin operations.
- Determine Your Budget & Apply for Funding as Needed: You will need to know how much money you have to spend on all of your business-related expenses before opening any doors. If needed, apply for a small business loan or other funding options.
- Get the Technology & Software Needed to Run Your Business Efficiently: You need to have the right tools in place to succeed. Implement software that will help you manage your time, contacts, and business operations in general.
- Market Your Bookkeeping Business to Potential Clients: A solid marketing plan will be crucial to your success. It should focus on attracting the right customers so that you can provide them with the services they truly need.
- Get Clients & Grow Your Business: Once you have a solid marketing plan, it's time to actively pursue and secure those who could benefit the most from your services.
Starting a bookkeeping business can be a great way to make money and help clients manage their day-to-day financial dealings and the records that go with them. There are many things to consider when starting a bookkeeping business, such as choosing the right legal form, marketing your business, and getting the necessary permits. With the right planning and execution, you can start a successful bookkeeping business.