As an eCommerce business owner, you know just how vital your bookkeeping activities are to the overall success of your company. Bookkeeping gives you the knowledge and power that you need to make a proper analysis and wise decisions, and it allows you to forecast for your future.
There is no doubt that bookkeeping is a vital activity for all businesses, even though it may be a tedious and time-consuming endeavour. Luckily, we have taken a deep dive into the world of eCommerce bookkeeping and have come up with six fundamental ways that you can optimize your processes.
#1 - Choose a cloud-based accounting software program
Using a cloud-based accounting software program is one of the best choices that you can make for your business. Not only does it offer more flexibility and reliability than traditional desktop software, but it offers a whole range of other benefits as well:
- It is easily accessible - Working on the cloud means that you can access your financial data anytime, from anywhere. You can also provide access to other team members or your accountants, making sharing important data much more effortless and allowing you to work in real-time all the time.
- It is secure - Using the cloud means that your data has been backed up and encrypted with the highest level of security. Your data is always kept safe and secure in the cloud.
- It reduces paperwork - If your dream is to become a paperless business, using the cloud can help. Not only will it eliminate waste, but the cloud also makes searching for specific data much more accessible than shuffling through piles of paperwork and reports.
- Information is easy to integrate - When using the cloud, it is effortless to integrate data from other bookkeeping tools like your eCommerce platform or payment platform. In most cases, this sharing of data can be set up to be completely automated. Not only does this eliminate the amount of work that you have to do, but it also simplifies the process leaving less room for error and keeping your records up-to-date all the time.
#2 - Outsource your bookkeeping
Many business owners spend exorbitant amounts of time doing their own books. Since the majority of these owners don’t specialize in accounting and bookkeeping, they usually aren’t very good at it and in some cases may even make critical mistakes. Business owners are also exceptionally busy running their business and more often than not, bookkeeping tasks end up getting neglected. This is where the benefits of outsourcing enter in.
Outsourcing is an excellent option for eCommerce business owners and it usually costs significantly less than hiring a full-time, in-house bookkeeper, helping you save money in the long-run.
Outsourcing allows you to utilize help from an expert, leaving your essential financials in capable hands and freeing up your time to focus on more important things like increasing your sales and growing your business.
For a more detailed look at how to outsource your bookkeeping, visit our blog.
#3 - Capture your receipts and documents
Nothing is more tedious than keeping track of your receipts and other documents, but luckily Dext Prepare can help with this burden. Dext Prepare allows you to take photos of your receipts with your smartphone, creating an appropriate transaction record, and immediately uploading it directly to your online accounting program. With such a simple process, your day-to-day expenses become extremely simple to take care of.
#4 - Automate your payments
Most of us already take advantage of automatic bill payments for utility bills in our everyday lives. Why not reap the same benefits of this service when it comes to our business? Paying our suppliers can be made into a stress-free and straightforward process when we get assistance from Plooto. This platform has been specifically designed to handle all of your accounts payable and receivable with an automated process that saves you a considerable amount of time and hassle.
#5 - Evaluate your inventory practices
Keeping things simple, especially when it comes to your inventory practices, can make a substantial difference in how smoothly your bookkeeping process goes. When evaluating your inventory, try to keep the following in mind:
- Keep the minimum amount of unsold inventory on hand at all times. Having an excess inventory takes up space and locks up your capital.
- Get a handle on your inventory. Using a reliable inventory management system will give you current information on your stock levels and the status of your orders.
- Choose an appropriate target product turnover rate, an ideal inventory system (FIFO vs. LIFO), and a preferred depreciation schedule that adequately meets the needs of your business. These can all have a significant impact on your bottom line. In order to operate as efficiently as possible, take a look at how other firms in your industry deal with these issues and attempt to create a business practice that replicates theirs.
#6 - Manage your sales tax
Worrying about sales tax and tax deadlines can be an issue for any eCommerce business owner. However, tax time can be a much simpler process with a bit of preplanning and some good organizational skills.
- Keep a detailed log of all products for which taxes must be collected and remitted and those that are exempt.
- Ensure that you know which government agency you need to remit the tax to. This will vary depending on the location of your business and your chosen industry.
- Keep a separate account for all collected sales tax.
Bookkeeping is a vital part of any eCommerce business. Keeping all processes streamlined and organized can help you stay focused on the most important thing - your company's success. Finding ways to optimize all aspects of your business will make the accounting process smoother and easier, giving you accurate and timely data about the financial state of your business at all times.
If you want to find out more about optimizing your eCommerce bookkeeping practices or are looking for the right company to outsource your bookkeeping to, look no further. At Enkel, we have an answer for all of your questions and, as a part of your team, can help you reach new levels of success.