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E-commerce is more than just sales—it’s having the right financials to work with. If you’ve been procrastinating at setting up a decent bookkeeping system, there’s no better time than the present. No matter if you’re on Shopify or on Amazon or you run your own store, from a long-term perspective it does matter that you have a clear bookkeeping process.
In this guide we’ll cover the ins and outs of e-commerce bookkeeping for beginners, including challenges, tools, tips, the most common mistakes, and whether you should outsource.
What is Ecommerce Bookkeeping?
E-commerce bookkeeping also involves keeping track of all things financial within your online store. This includes:
- Sales from multiple channels (Shopify, Amazon, eBay, etc.)
- Payment processor fees (PayPal, Stripe)
- Inventory purchases and adjustments
- Shipping costs and returns
- Sales tax and VAT
- Marketing expenses
- Payroll and contractor payments
It’s the foundation of your e-commerce financial management, helping you to understand your store’s profitability, manage your cash flow, and remain tax compliant.
Common Bookkeeping Challenges for Ecommerce
Bookkeeping for e-commerce businesses can be a confusing thing. When starting an online store, business owners often have to deal with the following problems:
Multiple Sales Channels
Do you have your own website or sell on Shopify, Amazon, or Etsy? That is a number of different sources of revenue that need to be reconciled.
Complex Inventory Tracking
Because of the constant stocking, bundling, and returning, it would be an inventory bookkeeping hell if not done by a machine.
Sales Tax Compliance
Every state (and sometimes even city!) has varying sales tax for e-commerce—tracking and filing correctly is an absolute pain.
Foreign Transactions
And should you sell abroad, currency conversion and accounting for value-added tax introduce an additional layer of, you guessed it, complexity.
Ecommerce Accounting Tools & Software
The following are the top bookkeeping software for e-commerce businesses that will make daily monitoring easier:
QuickBooks Online
One of the most reliable software programs, perfectly suited for Shopify and Amazon merchants. Through the integration of e-commerce and QuickBooks, you will be able to immediately synchronize your data.
Xero
Easy to use and great for small to medium online stores, especially those requiring bills in multiple currencies.
A2X
Made for Amazon and Shopify, this multiple marketplace integration system will automatically sync your marketplace data with QuickBooks or Xero.
Shopify’s Built-In Reports
Great for matching up with your Shopify sales each day and understanding how much you’re really making every day.
How to Create a Successful Ecommerce Bookkeeping System?
Separate Business & Personal Accounts
Your personal expenditures should never be confused with your business account.
Automate Data Entry
Use services such as A2X or Webgility to link your store to your e-commerce accounting software.
Set a Monthly Bookkeeping Routine
Review and reconcile your records for a few hours each week or month.
Track your COGS (Cost of Goods Sold)
Journal accurately so that your account is proper and generates true profits.
Stay Sales Tax Compliant
Leverage resources like TaxJar or Avalara for managing e-commerce sales tax.
Back Up Your Data
Utilize the cloud in your bookkeeping services so that you won’t ever lose important financial data.
Common Mistakes to Avoid
Here are common pitfalls to avoid when dealing with your e-commerce books:
- Small expenses are not important (it all adds up!).
- Not comparing payment processor costs
- Misclassifying returns or chargebacks
- Neglecting to record unpaid sales or open bills
- Combining income across sales channels
Ecommerce bookkeeping mistakes of this nature can result in the loss of time, money, and worry, particularly during the time of year when taxes are due.
Ecommerce Bookkeeping: Should You Outsource?
If you are drowning in the accounting or just want to scale up your store while someone else handles the books, outsourced e-commerce bookkeeping services could be the answer.
Benefits of outsourcing:
- Consistent, accurate bookkeeping
- More affordable than a full-time hire
- Services by e-commerce accounting professionals
- To keep your time free so that you may concentrate on your business.
How Velan Can Assist You with Ecommerce Bookkeeping?
We at Velan Virtual Assistants do bookkeeping for online stores like Shopify, Amazon sellers, and other e-commerce platforms. Whether you’re in need of catch-up bookkeeping, monthly reconciliations, inventory management, or sales tax filing, our knowledgeable virtual bookkeeping staff is the perfect solution.
With Velan, you get:
- Industry-compliant financial reports
- Cloud-based accounting setup
- Works great with your e-commerce software
- Budget-friendly bookkeeping services specifically for e-commerce 1% per month of sales + up to 100 transactions per month
FAQs: Ecommerce Bookkeeping Simplified
What is e-commerce bookkeeping?
It’s the process of monitoring and regulating all financial transactions of your online store—sales, receipts, and payments.
What is the best software for e-commerce bookkeeping?
Some popular ones are QuickBooks Online, Xero, A2X, and Shopify’s own built-in reports. Which one is best will depend on your volume of sales and channels.
Can I get by without hiring a bookkeeper for my online business?
If handling this yourself feels overwhelming or you don’t have financial expertise, consider hiring a bookkeeper (or outsourcing to a virtual service) to make sure it’s all done accurately and without sucking up all of your time.
In comparison to more conventional methods, how does online bookkeeping differ?
E-commerce has complexities like multi-channel sales, real-time inventory, and hundreds or thousands of sales tax jurisdictions to worry about, certainly elements beyond traditional service-based bookkeeping.
Is it possible to outsource bookkeeping for Shopify or Amazon FBA?
Absolutely. And many of the e-commerce owners can also take the help of experts who specialize in these platforms to get authentic and scalable solutions.
Final Thoughts
It is not necessary for the establishment of bookkeeping for your online store to be a challenging task. In return for the right tools, regular tracking, and expert advice, you’ll get a better handle on your finances—and peace of mind.
📞 Ready to clean up your books? Contact Velan’s e-commerce bookkeeping experts now!
