Are you starting an eCommerce business? You are focused on ordering and managing inventory, driving traffic to business, branding, marketing, selling, shipping, etc. But did you forget about accounting for the eCommerce business?
E-commerce has shown a high growth rate, with an expected 50% rise by 2025. Accounting for this industry is essential and unique from other businesses. You need to understand e-commerce business models, multiple sales platforms, payment service providers, and inventory applications related to e-commerce accounting.
With the growth of digitisation, new technologies and payment options, e-commerce has endless possibilities to rock the market. However, there are numerous things to know about this sector, and you may need to look for a specialist. We will discuss how to find an e-commerce specialist in the post.
Table of contents:
● Do I need an eCommerce accountant?
● What are the eCommerce accounting options?
● How to find a specialist eCommerce accountant?
● Conclusion
Hire an Ecommerce Accountant
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Do I need an e-commerce accountant?
Regardless of your business, an accountant can bring greater changes in the growth rate and successful operations. However, numerous questions are running behind owners’ minds, like Does an e-commerce accountant perform different activities than a regular accountant? Do I need to hire an accountant?
Though it is not mandatory to hire specialists, and you can perform your accounting with basic knowledge, eventually, you need them. Why?
● You don’t have sufficient knowledge to understand the financial nuisance of selling online and conducting business.
● You are unaware of the data to be recorded in the books.
● Your business is getting affected due to excessive tax burdens.
● You don’t know which financial tools to implement in an e-commerce business.
There are numerous reasons for hiring a specialist with experience in your industry. For example, if you sell on Shopify, an accountant can help you learn more about the platform and learn Shopify accounting measures than one experienced with Amazon and eBay.
What are the eCommerce accounting options?
If you are wondering whether to look for eCommerce accounting services, you probably need one. We don’t care about things unless the idea of their importance strikes our minds. Owners with a tight financial budget lean on accountants, and their importance increases as the details regarding sales get complicated and taxes are a burden.
So, if you are wondering whether to hire an eCommerce accountant near me or online, there is a high chance you already saw red flags in business. Start understanding your business needs and financial health before looking for accounting options.
Your eCommerce accounting options include:
● An eCommerce accounting software like Xero or QuickBooks
● Outsourcing accounting to a third-party company or individual specialising in e-commerce
● Hiring an in-house accountant
If you have sufficient financial experience, you can use an accounting platform to fulfil your bookkeeping needs. Otherwise, hiring a specialist becomes essential, especially when finances are complicated.
Outsourcing accounting is cheaper than an in-house accountant as you don’t pay employee benefits, employer NIC etc. Furthermore, you pay for their services only when you need them in business.
How to find a specialist eCommerce accountant?
Ecommerce business owners can start managing their accounts in the beginning. It is the most cost-effective option for your business. However, as the business grows and expands overseas or enters a new market, you face compliance obligations, and working with a specialist becomes essential.
Once you identify you need an accountant, the next challenge is finding a suitable specialist to work with you. Like any new employee, you need to find a reliable accountant specialising in e-commerce. Here’s a checklist of things any e-commerce accountant must be familiar with:
1. Check credentials
It is essential to look into the qualifications of your accountant before hiring them. It assures you are getting the right person on the team with an authentic license to provide accounting support to eCommerce businesses.
2. Check experience
A qualified candidate may not be the right fit for your company, experience matters. If your accountant has previously worked in the same e-commerce industry, they can help you with reliable and best solutions under any scenario.
It is essential to check if they have specialisation in the e-commerce industry. It reduces your pressure to understand the complications of this industry and stay on top of accounting. An accounting firm works with an experienced team ready to help you with anything at any time.
3. Understand the services
The services your accountant will provide must match the business requirements. If you are looking for an accountant to complete your bookkeeping and taxes, you won’t separately look for eCommerce bookkeeping services and eCommerce tax accountant, but all-in-one.
If you are outsourcing accounting, the firm will provide you with a list of services they provide to clients. Some of those will be customisable. However, for in-house accountants, you need to set up an interview to discuss what services they can provide for your business.
An e-commerce accountant must provide the following services:
● Categorising expenses and transactions
● Tracking expenses and inventory cash flow
● Track inventory, customer returns and chargebacks
● Calculate break-even sales
● Reduce tax bills, prepare for taxes, and pay them on time
● Prepare financial reports and analyse them to look for risks and opportunities
● Help in a growth plan and business expansion
● Develop a business plan and advise on making the right decision
● Assist in following government regulations and tax laws
4. Compare costs
New and established businesses are looking for an accountant that fits their budget. However, you can reclaim the accountant costs on your tax return. An accountant’s charge depends on their qualification, experience and range of services, along with your business size and turnover and financial complexities.
For third-party accounting firms, you pay only for their services, not employee benefits. Ask them how and when to pay, what to pay, and hidden charges, if any. Asking about charges in the first place can avoid future unnecessary expenses.
Hire an Ecommerce Accountant
Work with UK-based Experts for tax, audit, accounting, payroll, & EIS/ SEIS needs.
Conclusion
Hiring a specialist eCommerce accountant in business is not an easy task. You need to pay attention to the candidate’s skills, knowledge, and expertise, before including them on the team. It needs time and effort to select them and more money to retain them in business. However, to avoid these worries, you can always outsource accounting to well-reviewed firms and get assistance whenever you need them.