Managing your e-commerce business can always be a bit rocky when starting out, but it does get easier once you learn the ropes. However, one thing that can be hard to pick up is the importance and practice of bookkeeping. Some might even think that it isn’t necessary when there’s not much income being made yet.
In all actuality, though, it’s good to have accurate bookkeeping in motion. Those financial records are a good basis of how your business is doing, what affairs are ongoing and where you can improve. Even with running a brand and selling products online, the principles of monitoring your sales and expenses still remain the same.
A lack of attention to your ecommerce business’s bookkeeping can lead to a few issues along the way. Here are some errors that you should look out for and rectify immediately to ensure that your brand is right on track.
Tax Law Confusion
There have been some changes regarding the tax rules in Australia. This may be due to the fact that the Federal Government is making multiple adjustments to help everyone cope with the pandemic somewhat better. This can mean ecommerce businesses will have to face and adjust to different tax law updates when they’re part of the affected population.
This can be a cause for concern when you’re behind on your taxes, as a lack of compliance either way can affect your operations and threaten the closure of your e-commerce business. It’s best to get an accountant who is well-informed and updated, can help with your brand’s tax preparation and ensure that your business is in line with the proper regulations in place.
Data Organizing Issue
One big part of trying to get your bookkeeping in order is tracking every transaction your business has undergone. Whether it’s in terms of revenue or a payment to a similar company, having all that data on hand is important. This has to be accessible at all times in case there’s a need for a report or when they run into a problem.
Luckily, the introduction of many helpful accounting resources and tools has helped ease the stress of keeping everything orderly and manageable. Familiarity with the software may take some time, though. Some features may seem foreign at first, but once fully adjusted, that tech can be used as an advantage in information-sharing and data organisation.
Communication and inventory management issues can also be stressful because, as a retailer, you need to have the right amount of stocks to meet demand. Being unable to keep up with how much inventory you have and its worth can be confusing, to say the least. Imbalance and the risk of overstocking with no customers to get them can also be a challenge.
Most accounting technology also features data synchronisation alongside data organisation. This helps streamline certain processes like inventory management so that everyone involved and affected can have access to those details.
How sound an ecommerce business’s bookkeeping is can be a reflection and catalyst of the company’s current operations. It’s ideal to have someone with expertise provide advice for the business moving forward to ensure that there’d be no mistakes again.
Looking for a trusted e-commerce accounting firm to handle your bookkeeping? The ECommerce Accountant provides business advisors for online stores and influencers in Australia. Get in touch with us today!