The manufacturing industry is expected to increase from $86.7 billion in 2020 to $117.7 billion by 2025. It is a straight 6.3% of CAGR, which is very impressive.
Lately, with pandemic and economic slowdown, manufacturing businesses are shutting down rapidly. Many manufacturing units are struggling to meet their day-to-day operations and targets. Today, manufacturing companies need a magic potion that can revive them back. And, that magic vaccine/potion is Accounting Outsourcing Services!
Yes, if you outsource accounting services for your manufacturing business, you can save money, time and gain a better outlook on your business’s financial health. Now, we aren’t saying that because we offer the best manufacturing accounting services — no, we have facts to prove our case.
Let’s read ahead to find how outsourcing accounting operations can revive your manufacturing business.
6 Ways Accounting Outsourcing Services can do Wonders on your Manufacturing Business
Are you toying with the idea of outsourcing accounting services for your manufacturing business? Then, don’t think too much as many business sectors have already opted for accounting and financial outsourcing to get rid of internal staff management and hiring problems.
If you are looking for a accounting outsourcing company, then take a look at CapActix Business Solutions.
If you outsource manufacturing accounting services today, you can easily get the following benefits:
1.Analytical Decision Making
Manufacturing companies have to make numerous decisions daily. For example, they have to check inventory stock, make a list of raw materials, work in progress materials, profitability per unit, and so on. Based on inventory analysis, they have to place orders for the new stock and negotiate deals with the vendors.
Your floor manager has to make various decisions like this daily to smoothly run your business. When your managers spend all day analyzing situations and making decisions accordingly, they won’t be left with sufficient time to focus on their primary responsibilities.
In this situation, the accounting outsourcing team steps into the role of an analyzer and provides correct financial data to take action. Your outsourcing partner will keep inventory, sales, and other accounts ready so you can quickly make decisions and focus on core business operations.
2.Easily Scale your Business
If you plan to scale up your manufacturing business, it will also increase your accounting work. You have to hire new workers and buy more raw materials to accommodate your new orders. Moreover, some companies even hire individual contractors or daily wage workers to reduce their costs.
There’s nothing wrong with scaling up your business operations, but problems occur when you don’t scale up the accounting department accordingly. And, scaling up the accounting department means hiring new staff and investing in better infrastructure, which is highly expensive.
Here, outsourcing manufacturing accounting operations helps manufacturing businesses to smoothly elevate their production level without increasing operational costs. At CapActix, we helped many manufacturing businesses to expand their operations with our fast and correct accounting inputs.
Setting up a manufacturing unit requires a huge investment, including machinery, employees, building, and more. Therefore, it is essential for you to know what’s happening with your business all the time. So, you can eliminate any sort of internal and external risks.
To mitigate manufacturing risks, we offer special operational analysis solutions, including scenario, sensitivity, trend, and risk analysis. When the proper analysis is drawn based on correct financial data, you can easily avoid risks and uncertainties.
Meeting multiple local, state, and federal tax compliance is always challenging for manufacturing units. Also, the tax impositions on manufacturing businesses are way too much for a person to handle. Additionally, one error in tax reporting can lead to hefty penalties and punishments for businesses.
Accounting Outsourcing Services can help manufacturing companies in multiple ways to meet tax compliance, such as:
- Year-end Services: Year-end book closing can be messy and massive. Outsourcing partners can make sure that your year-end closing is seamless and correct to file tax.
- Financial Statement: According to the latest rules, they can prepare your business’s financial statements for easy auditing and taxable amount calculation.
- AR and AP Management: Outsourcing companies can help in maintaining cash flow so you can never have a shortage of cash in hand, especially during tax season.
- Tax Services: There are plenty of other tax reporting and management services that an outsourcing accounting team offers better than your in-house team.
5. Business Continuity
For manufacturing businesses, or in fact, every business today needs to have a strong business continuity plan. You never know when the next pandemic strikes or political dynamics change around the world. You have to be ready with a reinforcement plan to run your business despite unfavorable conditions.
During hard times, cash in hand or easy to liquid assets are the most helpful. From managing day-to-day operations to developing major infrastructure, cash is required to keep business continuing. Account Payable and Account Receivable are the two crucial services that can help in maintaining sufficient cash flow.
Account Payable Helps With
- Processing expense invoices
- Managing overhead
- Creating AP aging summary
Account Receivable Helps With
- Revenue recording
- Customer receipts recording
- Faster collection
- Creating AR aging summary
6.Errorless & Competent Accounting
You are in the manufacturing business, so you don’t know much about the latest accounting tools and technologies — it’s a fact. Plus, even if you want to use the latest accounting software in your organization, it is simply way too expensive for you. On the top, accounting technologies frequently evolve, so you can’t keep up with them.
Here, accounting outsourcing services provider companies are full-time into the accounting business. So, they constantly follow market trends and the latest technologies. Thus, you will get the high-tech, and flawless accounting work is done without any extra cost.
Whether you are running a multimillion-dollar worth manufacturing business or a small handmade unit, you need your finances looked up by professionals. With the accounting outsourcing support, you can focus on running your business and leave money problems at bay length.
At CapActix, we also offer manufacturing accounting services to our global clientele. If you want to know more about our services, visit our website or call us anytime.