If you’re running an eCommerce business, you probably like to keep costs as low as possible. Unfortunately, this means that you’re often juggling different facets of your business by yourself or relying on a limited crew. As such, you may have limited resources. In some cases, you may even lack the capacity to hire in-house employees like accountants, bookkeepers, and digital marketers.
However, you want to ensure your eCommerce business stays tax compliant and that you have a solid grip on your finances. Otherwise, it’s harder to make appropriate small business decisions and financial forecasts. With the right tools, you can cover your eCommerce business accounting needs without breaking the bank. Here’s how to set up an eCommerce accounting system.
Find the right provider.
Whether you’re looking for a platform that can help you with inventory management and spend reports or an accounting system that can parse data from your sales channel, there are vendors, software platforms, and firms that can help with your small business needs. For some eCommerce businesses, this means that you’re going to invest in accounting software. However, not every small-business owner has the time or resources to master a new accounting software platform or eCommerce accounting service. In these cases, it’s prudent to consider managed eCommerce accounting.
The right accounting firm or bookkeeper should provide diverse services that cover several facets of your eCommerce business. Sometimes, this means reconciling balance sheets or financial statements. Other times, it means recommending accounting software that can help you review your cash flow, generate financial reports, and automate general accounting tasks. For the eCommerce business owner, this can help you control your financials, review income statements on an ongoing basis, and make long-run plans for your eCommerce brand.
Migrate existing data.
To make the most of any eCommerce accounting software, you’ll need to find ways to port historical data into your new system. Depending on your chosen eCommerce accounting software or accounting firm, this could be a fairly streamlined process. Some of the best accounting software on the market has easy ways to scan and parse physical data for key information. With cloud connectivity, it’s even easier to create a data repository that leverages existing data and incoming information to help you make financial forecasts and data predictions.
Once you’ve migrated your data, you’re able to generate financial reports. This can help you spot trends within your cash flow statement, inventory management patterns, and shipment payment outliers that inform your decision-making. In addition, the right accounting solution can work with major eCommerce platforms to set up integrations, mitigate human error during manual processes like data entry, and help maintain sales tax compliance. With this setup, you’re able to track better how much money moves in and out of your eCommerce store and whether your existing business model meets your brand’s financial needs.
Investing in eCommerce accounting software or a managed eCommerce bookkeeping service is a smart move for business users who want to make the most of their data and gain insights into financial performance.
Conduct regular performance checks.
When you’re working with accounting software or a bookkeeper, you must verify whether or not your accounting services add value to your business. For example, if your chosen service or platform streamlines common data entry tasks and helps automate data collection, it might add robust value. On the other hand, if you find that you’re overpaying for your accounting service or that you do not see visible improvements where your financial needs are concerned, you may want to shop around some more to find a better fit.
When you’re thinking about your financial needs, it’s important to set up an eCommerce accounting solution that empowers you to make better fiscal decisions.