No matter what stage you are in your ecommerce business, investing in an excellent accounting platform is always a good decision. That's because a huge part of ecommerce operates online, and accounting and bookkeeping are essential parts of it.
But the problem is not about making a good decision. Instead, it's about making the best decision that lets you reap the full benefits of your accounting system investment.
Let Unloop lead the way for you with just two steps.
Step 1: Choose the Best Ecommerce Accounting Software for Your Online Business
QuickBooks Online (QBO) is our choice. This is the best cloud-based software you can use for ecommerce businesses. Some of the noteworthy features of this accounting software include inventory management, invoicing, time tracking, and mobile application adaptability. But we choose it because of the following.
Third-Party App Integration
QBO has more useful third-party app integration. These apps are suitable for marketplaces such as Amazon and Shopify and will make life easier for any ecommerce business owner who wants to automate or make certain aspects of their accounting and recordkeeping more efficient.
User-friendly
This software has an interface that's relatively easy to work with. We say relatively because it can still be confusing for a non-accountant to use. However, you can try to explore the software on your own and still find your way back.
On the other hand, if you prefer getting some knowledge before touching the software, plenty of online tutorials can get you started.
Scalable
Manual transaction inputs are okay when your ecommerce business is still starting out. But the volume of sales transactions can be difficult and time-consuming when it grows.
Good thing QBO can sync to ecommerce platforms in a way that makes it easy to track sales. So no matter how much sales volume you get, once you sync it to your QBO, you won't have to worry about recording the transactions yourself. This is what makes QBO a scalable accounting software.
Step 2: Have Your Ecommerce Accounting Software Managed by Experts
QBO is a powerful ecommerce tool. But, to reach its full potential, you'll have to know your way around the software. Plus, you also have to have specialized knowledge to get into the nooks and crannies of QBO and push it to its limits.
The reality is, even if an ecommerce business owner chooses QBO, they'll just use it to record transactions. That's because it takes time to learn and become an expert with the software, let alone know the accounting principles that make it work.
To make your QBO investment worth it, have it managed by a team of accounting and bookkeeping experts. You'll get more than just simple transaction entry. You'll get the following.
Ecommerce Bookkeeping
QBO is perfect for an ecommerce business with an online store on Amazon or Shopify. In addition, this cloud accounting software can work well when combined with different ecommerce applications.
Accounting and bookkeeping agencies specializing in ecommerce businesses use this accounting software to its full potential. They can do bank reconciliation, analytics, and monthly financial statement reporting. They do these things on top of regular accounting and bookkeeping duties.
Accounts Payable Assistance
Quickbooks has robust accounts payable and receivable features. Small business owners new to this accounting software may not use it as well as the pros do.
By letting accounting professionals take over, your accounting software, combined with other payment management tools, can be used to do the following.
Payment Assistance
Bookkeepers know how to use this accounting software to organize the invoices your business needs to pay. Combine that with a synced bank account that's neatly managed, and you'll get an effective record of short-term debts that these bookkeepers can pay at your signal.
Bills Payment System Setup
Apart from organizing your bank account and payables, professionals can also add other bills payment tools that automate your payment process. This way, you don't have to manually go over them and get confused with the payment deadlines.
One-Click Invoice Approval
Giving approvals for invoice payments can be more efficient. Accounting and bookkeeping agencies can make this happen if you have QBO as your cloud accounting software.
Accounting specialists can set up a one-click invoice approval system. Once it's in place, all you need to do is click to approve, and the specialists will process the payment via check, electronic fund transfer (EFT), or an automated clearing house (ACH).
Once the payment is settled, the transaction is recorded or updated in your ecommerce business accounting software.
Forex Rate Maximization
When you let bookkeeping and accounting experts handle your accounting system, they apply finance expertise. Foreign exchange rate knowledge is one of them.
This is useful if you're selling on an ecommerce platform such as Amazon or Shopify. These marketplaces have a global reach, and if you're paying money to vendors in other countries, it's best to take advantage of forex rate discounts.
Accounting and finance experts know how to work with forex rates. They can use it to your advantage and ensure that what they record as an expense will help your bottom line profit.
Inventory Management
QBO has an inventory management feature that lets Shopify and Amazon sellers sync their product data to the accounting software. This allows ecommerce business owners to track and manage their inventory using their value.
Hiring accounting for ecommerce pros will allow you to maximize this feature. Apart from checking the accuracy of your beginning and ending inventory, they can also do the following.
Proper Cost of Goods Sold Calculation
Income statements can suffer a lower net profit because of a miscalculated cost of goods sold (COGS). This happens when a relatively new ecommerce small business owner with little to no accounting background attempts to get the product's cost with no expert help.
Accounting and bookkeeping professionals adept with marketplaces can make this easy. They know where to source the costs of the products sold and how to calculate them. As a result, the COGS in your income statement is accurate and syncs with your inventory valuation.
The Correct Inventory Accounting Method
If the current value of your inventory doesn't make sense, it's because you are using an incorrect method. So the number reflected in your balance sheet may be too high or too low for the current units you have in stock.
Anything that feels like it doesn't add up can be a problem, especially when tax season comes. So it's important to fix it soon. Even if you have the best accounting software, the skills needed to determine the proper inventory value may be lacking.
This is where an ecommerce accountant can help. They know different inventory accounting methods that are accurate and compliant with your state's tax laws. They understand that the numbers in your QBO are constantly moving and know how to take an accurate snapshot of it for your balance sheet.
Tax Services
Taxes are perhaps the most difficult to manage for any ecommerce business. It can be challenging to stay compliant if you don't know your way around the ecommerce platform. Not to mention the woes of registering and filing for taxes.
While it helps that marketplaces can sync to accounting software, you'll be at ease when you let pros manage it for you.
Bookkeepers and accountants can help you with the following taxes.
Sales Tax
Every sales transaction has a tax levied on it, and the obligation to collect and remit falls on the seller. However, with ecommerce businesses, this can be confusing to track because the sales are coming from different regions.
Hiring an accounting professional with ecommerce experience eliminates this problem. These people can help you set up your sales tax collection system and assist you in recording payments as well as ensure sales tax compliance.
Income Tax
A significant part of paying income tax is getting your financial statements right. So one of the benefits of choosing the right accounting software and combining it with a competent accounting team is that you take this off your plate.
Bookkeepers will maintain accurate records in your software. Then, come tax time, they'll generate your statements and hand them over to a team of accountants within your area to file the income tax for you.
Ecommerce Accounting Software Made Better
Choosing QBO as your accounting software and having it managed by experts will leave you wanting nothing. First, having QBO is like setting up an excellent accounting system for your ecommerce business. It has all the essential features and is competitive in quality and ease.
Second, having bookkeeping and accounting experts handle QBO will help you push it to its full capabilities. They can offer you the services mentioned above and more. They'll work with your accounting software and apply their knowledge of ecommerce and accounting so that all you need to do is grow your business.
QBO is easy to get. But an excellent team with accounting and ecommerce expertise is hard to find. The good news is, you need not look anywhere else. With Unloop you can both, and we can use QBO to turn your accounting on autopilot.
Talk to us about what we can do. Dial 877-421-7270 for a consultation, or check out our ecommerce services now.