The eCommerce industry is fast-paced and competitive. From freight and logistics to website updates and marketing campaigns – there’s always something to occupy your thoughts and keep you busy. But for your eCommerce business to thrive, you need to prioritise the finances. One way you can do this is by finding an expert eCommerce accountant who can make your life easier by supporting with the financial needs of your online business.
The difference between eCommerce accountants and traditional accountants
ECommerce accounting is a complex area, and it requires specialist accountants familiar with the requirements. Expert eCommerce accountants will help business owners integrate their online stores with their accounting software, advise on complex VAT rules for UK and non-UK sales and ensure all the required tax filings are complete.
They will also provide all the traditional accounting you require, such as bookkeeping, accounts, corporation tax and payroll.
Traditional accountants are unlikely to be familiar with Shopify and other sales platforms and will therefore struggle to support with the integration. They may not be up to date with the latest VAT rules either leaving you trying to figure it out on your own.
So, what should you be looking for when choosing an eCommerce accountant?
We’ve got you covered. Below are the top things you should look out for:
Professional expertise
As a very minimum you need your accountant to keep your business compliant so make sure they know their stuff and have the necessary qualifications. You’ll want to look for a Chartered accountant, which means they’ve received professional accreditation, have undergone industry training and are a member of a professional body. This information should be easily visible on their website.
Take a look at their website and social platforms to get a feel for whether they’re a knowledgeable source of accounting info. Are they sharing valuable insights and advice that you will benefit from?
First-hand eCommerce experience
Every business owner wants an accountant who understands their business but when it comes to eCommerce having an accountant who ‘gets it’ couldn’t be more important. An accountant used to working with online businesses will be familiar with the unique requirements of eCommerce accounting, your sector and the challenges you as a business owner face.
Those with first hand eCommerce experience will likely be working with lots of other eCommerce clients and online sellers and in a position to help with sector specific requirements, such as:
- Payment service providers and payment gateways
- Supporting with inventory tracking to ensure accurate reporting of profit and loss
- Saving you money by keeping you tax efficient
- Managing cash flow, taking in to account hidden costs
Different ways you can check an accountant has eCommerce experience:
- Check their Google reviews online – have any of them been left by eCommerce sellers or mention their eCommerce experience?
- Check their website – does their online shop window cater to you? Do they have a specific eCommerce landing page for example with testimonials from other eCommerce clients?
- Ask them directly – when looking for an accountant you’ll usually have a discovery call – use this time to ask them about different eCommerce businesses they’ve worked with to get a feel for their level of expertise.
Integration know-how
Integration is the name of the game.
With sales taking place day or night it’s super important that your foundational processes are integrated and automated. A good eCommerce accountant will use cloud accounting software such as Xero or QuickBooks and integrate it directly with your Shopify or Amazon store.
Why is integration so important?
- Sales appear in real time
- Saves hours of manual data entry
- Reduces errors associated with manual processing for example with non-UK sales which may not be subject to VAT
- Tracks associated selling costs like Shopify fees in real time
- Gives the business owner an up to date view of where the business is at and makes decisions based on this data
- Means you see the same data in your online store and your accounting software
*Note – the right integration for you will depend on your business, the platform you’re selling from and the accounting software you’re already using. A good eCommerce accountant will be able to advise on the best integration options to meet your needs.
Some typical integrations include:
- Sales – tools like A2X & Linkmybooks automatically integrate eCommerce platforms and marketplaces to your accounting system.
- Inventory – there are a number of apps that can provide full inventory management. You will have your own unique needs but your accountant will be able to offer advice. Some of the sales tools mentioned above can also handle inventory management.
- Payments – integrate payment gateways like Klarna, PayPal and Stripe and automatically reconcile these against sales.
Love of learning
The world of eCommerce is fast-paced and ever-changing so you’ll want your accountant to keep up. It’s important they have a learning and growth mindset – just like you! Basically, you want them to have a thirst for knowledge and an appreciation that learning is never over. They should adopt the words of tech wizard, Steve Jobs “Learn continuously, there’s always one more thing to learn.”
This mindset will mean they’re across all the latest industry developments and are bringing you relevant, timely and industry-specific information. For example, a good eCommerce accountant will be proactive with advice around break even, marketing spend and measuring customer acquisition cost and close cash flow management.
Friendly persona
As an eCommerce business owner you’ll want to feel you can pick up the phone to your accountant and reach out to them for support and advice. Running an online business can be a hard gig – you don’t want to fear speaking to your accountant. A good eCommerce accountant will feel like an extension of your own team – someone you can email, call or even Business WhatsApp a message to with queries you may be having.
In the words of Simon Sinek, “We don’t do business with companies. We do business with people.” Getting on with your accountant shouldn’t be overlooked, in fact it’s fundamental. You’ll want to develop a long and lasting relationship with a trusted and friendly eCommerce accountant who can support you on your business journey.
To find out if someone’s the right accountant for you book a discovery call. Speaking with someone is the fastest way to suss out whether they tick the necessary boxes.
We have experienced eCommerce accountants working with clients using both Shopify and Amazon sales platforms. We’re passionate about helping small online businesses reach their full potential and would love for you to give us a call today.
FAQ’s
What does an eCommerce accountant do?
An eCommerce accountant should offer industry specific expertise like integrating your online store with your accounting platform, inventory and cash flow management and expert VAT advice. They should also offer all the things you’d expect from a traditional accountant like bookkeeping, year end accounts and tax returns.
What are the accounting issues for eCommerce?
Common accounting issues for eCommerce businesses include:
- Online stores like Shopify not being integrated with the accounting platform leading to manual data entry and risk of errors. Integrations mentioned above can help save time.
- VAT – handling UK and non-UK sales accurately. Expert advice is needed here to ensure VAT is calculated correctly.
- Poor cost management – to run a successful business you need to be all over your costs and advertising spend. Monitoring these closely and having accurate information you can use to make decisions from is key.
How do you know if an accountant is good?
To start with, ask them! You should be able to get a good feel for their eCommerce accounting experience by speaking with them directly. You could also check out their Google reviews for any mention of eCommerce or look at their website for testimonials or case studies from other eCommerce businesses. You can also check their website to see if they’ve mentioned Chartered accountant status.
Want to learn more about Raw’s eCommerce accounting services?
Find out more here.
