In one way or another, small business owners like you have done ecommerce.
Think about the last time you sold a product. Perhaps you even created a business page and took pictures of all the items sitting in your shop or home. Maybe your customer got a hold of you through social media, and you concluded the business there. In a way, that is ecommerce.
There's no denying that today's world has opened its arms to online businesses. It took a pandemic to realize our existing technology is ripe for this switch, and it looks like it's going to stay.
Apart from a consumer-driven shift to online shopping, changes also happened behind the scenes. Accounting is one of the major influences, especially for entrepreneurs.
So let Unloop unravel how changes in accounting influenced this change. In addition, we will shed light on how accounting will continue to play a role in ensuring ecommerce is the future of business and how you can start making the switch, too.
The Role of Online Accounting in Influencing the Shift to Ecommerce
For some established small or medium enterprises, there's hesitation regarding a shift to ecommerce. But accounting technology has become more advanced and accessible in the last few years making the switch to online accounting more palatable.
As a result, a typical business owner feels less resistance to the idea of virtual small business accounting and is now more open to making the shift. Here are some of the accounting trends that are changing the minds of today's business owners.
Accounting Software Purchases
With the switch to ecommerce, small businesses think it's more practical to transition their accounting systems for easier management. This option became more attractive because of the accessibility of user-friendly accounting software such as Quickbooks.
Demand for accounting software (and other ecommerce related technology) increased. As a result, many small businesses jumped in and made the investment as part of their ecommerce business tools.
A Shift to Cloud Accounting
What's good about accounting softwares like Quickbooks is that they can be cloud-based; businesses can securely store their financial data on several servers. This makes their accounting reliable.
Quickbooks Online is an example of cloud accounting software. Aside from reliability, what makes cloud accounting very attractive to ecommerce shifters is the scalability. It allows businesses to tap into a vast storage space as their main accounting data center.
Cloud accounting also reduces costs. So it makes sense for owners to transition even just the accounting facet of their business online because there are infrastructures in place that can accommodate their data needs.
Outsourcing Accounting Online Services
The existence of bookkeeping software and cloud storage gave rise to another type of online business: outsourced online bookkeeping. This eliminates the time-consuming task undertaken by in-house staff and passes it to more capable hands.
Outsourced accounting services are possible because could-based software allows access to accounting data remotely. As a result, ecommerce businesses can enjoy the benefits of having their accounting on autopilot even if their accounting staff is not in the business premises.
Should You Ditch Your Accountant?
An online accounting service will not replace your accountant. Despite the growth in automation and artificial intelligence, a professional accountant is still valuable for any small business. If anything, they can enhance accounting services online.
Here are some functions an accountant can do in conjunction with your virtual bookkeeping or accounting service.
Whether you're a small business owner transitioning to ecommerce or have your feet firmly planted, accountants can help. In addition, they can assist you if you want to adapt your business's accounting system to include the ecommerce side.
Additionally, established ecommerce businesses will want to consult accountants for systems-related decisions. For example, things like investing in new accounting software or streamlining bookkeeping and accounting will need a professional's insight for it to be done in compliance with existing laws.
Incorporating accounting software, whether on your own or through an online bookkeeping service, involves a degree of automation. In most cases, automation happens during a transaction.
Accounting automation is excellent, but it's not perfect. For example, business bank accounts synced to the software may be removed, and amounts taken from different payment methods may cause issues. Depending on the volume and complexity of your business, this can cause a serious headache.
Currently, automation and artificial intelligence technology can't solve this issue. So this is where your accountant will shine. They can audit your business transactions and make sure they sync with the business accounting books and bank accounts in case the online system fails.
Current accounting software and online bookkeeping services have limited tax functionalities. Virtual bookkeepers can best assist by giving the information needed to file tax returns. Then, you do the filing itself.
But accountants are qualified to file taxes as well. They'll know which forms to fill out. Most importantly, they'll know the right amount to pay.
These are functions that are yet to be developed by any automated bookkeeping service.
Switching to Online Bookkeeping and Accounting Services
As a small business looking for a partial or full ecommerce transition, it's always wise to start with the foundation—accounting. Laying this down before anything else ensures you have the right financial information system to manage and keep your ecommerce business running well.
The best bookkeeping service out there will have the following.
Bank Account Syncing
One of the highlights of online bookkeeping services is bank account syncing. Professional bookkeepers know how to link your business account to the accounting software. Plus, these professionals serve as your business's guardians because they monitor transaction issues.
This takes bank reconciliation almost out of the picture. Since every transaction made to and from your business account will reflect the system, there's no need to do manual cross-referencing to ensure the balance of the books matches what's on the account.
Virtual Bookkeeping Service
Bookkeeping is the bulk of any virtual accounting service. Hence why, it's interchanged with virtual bookkeeping service. By switching your accounting needs online, you'll be delegating the most time-consuming and tedious work on your business's accounting and finance side.
Both physical businesses and ecommerce businesses can benefit from virtual bookkeepers. That's because part of their bookkeeping task is to use technology such as Quickbooks Online and do a full cycle accounting for you. As a result, you'll get accurate and fast recordkeeping for your business.
A typical small business today relies on direct deposits to pay salary. That's one more complication to consider. A slight transmutation or omission error can result in giving too much or too little. Another thing that can happen is not paying your employees.
A payroll service can drastically reduce this issue. Bookkeepers ensure that the correct amount is paid to your employees' direct deposit accounts. Then, all you may need to do is click a button.
Payroll service is also an advantage if you're employing people from around the globe. Most ecommerce businesses do this, and they have to deal with foreign exchange rate fluctuations to maximize resources. Virtual bookkeepers can use their payroll tool expertise to help make this happen.
Tax preparation and filing season are perhaps one of the most stressful periods for any business. It's a time when books have to be audited internally and balanced to ensure everything is recorded and in the right place.
Even if you have accounting software, this can be challenging. That's because you or your staff may not attend to bookkeeping religiously.
This is where virtual bookkeeping shines. They stay on top of your business transactions because that's how they learn what you and your business need. Then, come tax time, you only need to request financial information, and they'll give it to you, which brings us to the next service.
Generation of Financial Reports
If you're used to getting financial statements only during tax season, that can change. Accounting management services employ bookkeepers that can give you monthly financial statements so you also stay on top of your business even if it isn't time to file for taxes.
Generating financial reports is a breeze for an online bookkeeper. They ensure that monthly expenses and revenue are accounted for so they can send you reports. You can request stuff like balance sheets, income statements, and cash flow at a moment's notice.
Customer Service for Owners
When it comes to business-to-business transactions, owners and their staff highly value customer service. These people deal with end users and stakeholders, so they must ensure everything is running smoothly.
Accounting is no exception. Owners and their staff have to answer to investors, creditors, and tax collectors, to mention a few. So they'll need someone they can coordinate with to handle bookkeeping and accounting issues to ensure the cogs run as they should.
The best bookkeeping service has reliable customer service for owners and staff. They'll be ready to respond to you within a day for any accounting and bookkeeping problems.
Future Proof Your Business With Accounting Services Online
In today's uncertain world, ecommerce stands as a beacon for everyone. As long as technology keeps evolving, online businesses will continue to improve. So it's best to keep up with it.
Future-proof your business and switch to ecommerce. If not fully, at least have an ecommerce facet. But before you do, have your online accounting services laid down first. This will ensure a seamless transition.
Talk to us if you're interested in checking out how our accounting and bookkeeping services can fit your ecommerce goals. Dial 877-421-7270 for a quick call, or check out our ecommerce services now.