Ecommerce Accounting Services for Your Growing Business
First, we just have to say, we love ecommerce accounting! And not because it’s easy. We know there are a number of challenges that ecommerce businesses face when it comes to their accounting.
We do love a challenge! But we also love providing ecommerce accounting services that are tailored to each business.
There are so many efficiencies made possible with cloud accounting and our ecommerce accounting services work for so many businesses, whether they are just starting out or have been in business for several years.
So, what services do we provide and how do we help our ecommerce clients solve some of their biggest accounting challenges?
First, Everyone’s Fav…Bookkeeping!
We know, we know! Everyone loves bookkeeping, right? Nope. Most people don’t enjoy bookkeeping at all, unless they have a strong background in it. And let’s be honest, many people with successful ecommerce businesses don’t necessarily have a background in bookkeeping.
Some business owners will learn, either by reading detailed blog posts (like our post about our top ten bookkeeping tips for business owners), or even by taking bookkeeping courses. And others will hire a bookkeeper or an accounting firm to handle their bookkeeping.
But what’s the right software?
Through the years, we have seen some ecommerce businesses with an insane volume of transactions. And in many cases, the owners simply did not have the time to do the bookkeeping themselves. They also weren’t always using the right software for their bookkeeping.
With any new client, and specifically with an ecommerce business, we always first look at their bookkeeping software.
Since we are a cloud accounting firm, we recommend cloud accounting software. Xero is one of our favourites.
The great thing about Xero is that it can actually integrate with ecommerce platforms, such as Shopify. If you are interested in learning more about the Xero integrations with Shopify, check out this list of the integrations, with customer ratings.
A good integration allows for a seamless flow of information between both platforms, and makes bookkeeping and evaluating the business’s success in real-time much more possible.
Next Up, Inventory!
Initially, some ecommerce businesses track their inventory in an Excel spreadsheet. Obviously, as businesses grow, that may no longer be feasible.
But for those who can still manage their inventory in Excel, we provide guidance on things like how to properly record purchases and sales. For clients who have outgrown their Excel Spreadsheet or current inventory management software, we will suggest new apps or software they can implement that can help them with their inventory struggles.
It’s not always a one-size-fits-all solution – different apps and software might work better for different businesses.
Whether you are using an Excel spreadsheet or using a popular alternative, like Airtable, we provide the guidance and expertise to ensure your inventory is managed effectively and accurately.
Curious about Airtable? It’s pretty neat! Find out more here.
Let’s Not Forget About Sales Tax!
Sales tax can be an interesting issue, particularly for ecommerce businesses who are selling products in multiple provinces. There are different tax thresholds in different provinces, and as a result there are different tax filing requirements for each province.
It can be a lot to keep up with while also running a growing business.
Is your bookkeeping up-to-date?
It’s essential for any ecommerce business to make sure their bookkeeping is up to date. For businesses who are not on top of their bookkeeping and who do not use an app like Shopify (which calculates the sales tax based on customer location), they may be filing their sales tax returns incorrectly.
Which means they may be overpaying or underpaying the CRA, and could be charged penalties and interest.
Pro Tip: The penalties and interest you have to pay the CRA are not deductible. Whereas the accounting fees you pay are. Just saying!
And don’t forget about ITCs (Input Tax Credits). Making sure you are allocating and calculating these correctly is also important. And it just happens to be something we help our clients with!
Are you confused about your filing requirements?
Depending on the provinces you are selling in, you may be collecting varying tax amounts and (as mentioned above) also may have different filing requirements.
If you are wondering about the different GST/HST rates by province, check out the Government of Canada website. It also details the differences depending on what your business is selling.
Now imagine trying to keep track of all filing requirements for every province you do business in? Or maybe you are already doing that. We can manage all of your sales tax filings (and the varying thresholds), so that you can focus on your business.
What About Compliance?
Oh right! We could never forget about compliance! Similar to what we just mentioned about sales tax, it’s important for all businesses (not just ecommerce businesses) to ensure tax compliance and proper record keeping is maintained at all times.
For ecommerce businesses, it can be challenging to know what tools to use, particularly when looking for paperless record keeping options.
Are there cloud solutions for that?
There sure are! We often recommend a combination of Receipt Bank and Hubdoc to our clients. Receipt Bank, for uploading receipts, and Hubdoc, for keeping bank, credit card, utility, or other statements that they wouldn’t normally have easy, online access to.
Curious about the apps we typically recommend to our ecommerce clients? Keep reading!
Pick An App…Any App
Well, not quite. We are careful about what apps and software we recommend to clients, and we always give a full update on the current tools being used and present other alternatives that exist that might work better.
Here is a rundown of the main apps we recommend to our corporate clients:
Tailored Ecommerce Accounting Services
When it comes to how we do things, we work around every client’s needs. We start our relationship with all clients by gathering details about their businesses and their needs, in order to offer them a plan or package that is customized to them.
It’s not a one-size fits all approach, where (for example) all bookkeeping is done at year-end. That’s a thing of the past. We work with our clients to find a framework that works for them, not just a framework that works for us. Our clients come first, always.
Looking to up your ecommerce accounting game? Click here to schedule a call with us!