ECommerce sales have grown dramatically over the last few years, with worldwide retail eCommerce sales expected to reach $4.9 trillion by 2021, according to Shopify Plus, 2019. As the retail industry shifts to digital, one avenue that budding eCommerce businesses should watch closely is the way they approach eCommerce accounting. What is eCommerce Accounting? ECommerce accounting takes the fundamental aspects of business accounting, but it also differs from regular accounting in numerous ways. Imagine that you’ve started an eCommerce business on Shopify, Amazon, eBay, or a similar sales channel. To successfully run the business, you’ll have to truly uncover the secrets of profitability and cash flow. This is especially true because every industry comes with its own accounting nuances—and it’s your job (or your accountant’s) to figure out what those are. Some unique areas of eCommerce accounting to pay close attention to include: an in-depth understanding of both inventory and cost of goods sold (COGS), where to locate transactional data, sales tax, and how to reduce foreign transaction costs. Whether you already run a successful eCommerce business or are just starting at square one, accounting is a fundamental part of any online business. Knowing this, and with the help of eCommerce accounting software, can help businesses spot anomalies in cash flow, drive sales, lower audit risk, and prepare for tax season. Here are some key features and benefits to keep an eye out for when shopping for eCommerce accounting software: Comprehensive, Accurate Reports The majority of accounting software provides basic reporting, but only a few may have the few features that your eCommerce business needs. The ability to reconcile business transactions and report on those insights within an eCommerce accounting system is crucial—especially if your business is expected to grow rapidly. ECommerce business owners should look for software that has the ability to connect to their bank account(s) in order to automatically populate transactions. This allows you to view real-time data, which translates into a real-time, accurate glance into how your business is doing financially. Accounting software that not only presents transactions in real-time, but also credit card and bank balances are better able to provide a true look into your business’s health. From there, reporting on business-critical reports such as cash flow, income statement, balance sheet, accounts receivable & payable, and trial balance & general ledger are right at your fingertips! Customer Support that Actually Responds When your entire business’s backend accounting runs on a single software or application, customer support is key. The experience a user has with a product matters. But so does their engagements with customer support. When looking for various eCommerce accounting software to help run your business’s books, be sure to check out support ratings and reviews to see how the software company’s customer support service actually holds up. PCMag, Capterra, and Merchant Maverick are just a few small business/product review sites to take advantage of when conducting research. Kashoo was recently recognized by The Blueprint as the “Best Support” accounting software out of nearly 400 accounting solutions. Reviewed and ranked by accounting experts, The Blueprint praised Kashoo for its intuitive and trouble-free design for bookkeeping beginners and live telephone support—a feature that’s been heavily underestimated by other software solutions. Accounting Education for Bookkeeping Beginners Most entrepreneurs who choose the eCommerce route might have studied accounting in college, but it likely wasn’t their favorite class. And even so, accounting isn’t exactly something that you can fully learn within a day. When scouting for eCommerce accounting software, pay attention to software companies that have a customer support team that can answer questions you may have. Whether it’s onboarding or basic accounting principles you don’t understand, the customer support team should be there to help you every step of the way. Ease of set up is another factor to consider when choosing an eCommerce accounting software. Software companies that offer an elaborate help center to provide Q&As and provide free workshops and webinars for small business owners are that much more useful for eCommerce businesses just starting out. Sales Tax Configuration Sales tax can be confusing for eCommerce businesses. It’s important to find accounting software that automates much of the accounting work if possible. This includes making it as easy as possible to charge and account for sales tax. If the software automates the sales tax calculation process, then that’s one less thing for you to worry about! If you’re looking for the perfect eCommerce accounting software for your business, then look no further! Sign up for Kashoo’s 14-day free trial or get in touch with our friendly customer support team to ask us any questions you may have. We’re here to help!
