In any e-commerce business or small-medium business, having a firm grip on one’s finances is essential for ensuring in the long run.
Regardless of whether you’re selling food, supplies, or shoes, putting any e-commerce front together entails keeping your finances intact. One of the most crucial details that any SMB needs to consider and watch out for is the common e-commerce accounting mistakes that can be made when it comes to setting one's accounts straight.
Common e-commerce accounting mistakes you should avoid
Fortunately, getting ahead of the competition while avoiding any problems in both the short and long run can be done by considering all the necessary details. In the sections below, we will delve deeper into the three common e-commerce accounting mistakes that you should avoid:
Mistake #1: Not being able to double-check data
Out of all the mistakes that many e-commerce SMBs are guilty of, none cause more trouble than overlooking the importance of double-checking accounting data.
While it may be quite tiresome and boring to go through rows and columns of data, it pays to pull out the necessary effort as spotting a flaw or problem before it grows bigger can save you a fortune. Taking the time, patience, and dedication to double-check the accuracy of your accounting data will prevent any crucial details from slipping through the cracks.
If you aren’t familiar with the task of going through your data and making sure that everything’s in place, here are a few questions you can ask yourself:
“Are the amounts listed in the reports correct?”
“Do all my different reports, statements, and records coincide or line up with each other?”
“Has every entry in my system or ledger been paid for or cleared from being accounts receivables?”
Mistake #2: Failing to invest in a dependable accounting software
Thanks to the Internet, the days of painstakingly logging in financial entries and inputting details are far behind. Yet, there are still SMBs who put themselves through unnecessary stress of manual work!
At the same time, many Australian e-commerce business owners still find themselves being entirely unaware of how accounting software can improve their lives. Instead of troubling yourself with writing down your updates, a simple, yet dependable software can get everything done much faster and keep everything as accurate as possible!
Mistake #3: Miscalculating cash inflows
When it comes to the importance of maintaining an SMB’s finances, it’s important to note that no one is exempt from the task of correctly calculating cash inflows.
Miscalculated cash inflows are about counting your incoming payments and sales made before they’re even paid off or settled. It may not seem like much, but recording a payment before it’s made or settled can lead to several inaccuracies in your data that will get in the way of proper decision-making and forecasting!
Conclusion
Similar to any other part of running a business, your finances bear a few potential mistakes that need to be avoided at all costs to ensure that everything runs smoothly. By taking note of the common e-commerce accounting mistakes mentioned above and rolling out the necessary measures to prevent them from happening, you can save yourself time, money, and effort in the long run!
We are a financial service firm that helps Australian online businesses and influencers with Shopify bookkeeping, e-commerce accounting, and e-commerce taxing. Get in touch with us today to see how we can help you grow your business!