Everything to Know about Accounting for Amazon and E-commerce Sellers
If you think that accounting for typical businesses is grueling and very labor-intensive, then you may find E-commerce accounting to be an entirely different beast of a job! For those who are looking to start running a business online like in Amazon, accounting activities are a crucial part of establishing a proper groundwork for it to flourish and succeed.
In this article, we will be your guide so you can have a good grasp of how to do proper E-commerce Accounting as an Amazon Seller. Grow your business from the ground up and learn about the basics of Amazon Accounting.
Basics of Amazon Accounting
Registering your Business and Setting up Accounting Systems
One benefit of having your company registered is it allows your business to be secured of possible liabilities in the future. Registering your business also detaches your business income from your personal income.
Owning a business also means you are liable to meet your legal obligations for your business. To relieve yourself of many liabilities of business ownership, registering your business early would be a smart thing to consider first.
After registering your business, you must also start considering looking for good and reliable accounting software for your business. Amazon seller accounting can be done in spreadsheets or manually, but accounting using those methods can be hard and is more prone to mistakes as opposed to dedicated accounting systems.
With recent developments in modern accounting systems in the present, producing duplicate accounts or having constant software updates are no longer a requirement. Accounting systems utilizing the cloud now allow users to access their business’s books and accounts anywhere so long as they are connected to the internet and have the requirements needed to access them anytime.
Providing a Strong Business Plan for your Amazon Business
Amazon seller accounting is one of the many benefits and essentials to have for your Amazon business plan to succeed. In essence, a business plan is your guide for you to develop strategies and organize how your business could grow both in the present and in the future.
Accounting software also provides several benefits for your Amazon business plan to work. Using this software, they can automate documentation of every financial statement needed by your company like bills, invoices, receipts, etc.
Note: Specifying what specific data you need to extract in your Amazon accounting is needed in your business plan’s financial section. This way, it would be easier on your part to extract such information from the data given by Amazon and fill in identifiable gaps in your business in the future.
Systematic checkups for Elimination of Errors
Using accounting software to automate your business transactions doesn’t mean that your accounting activities are free of errors. As such, regular checkups of as much as once or twice a day is important for you to mitigate these mistakes in your accounting procedures.
For as much as 10-20 minutes, routine checkups will enable your business to enhance your business’s performance, find out errors (like a possible recognition of your inventories as an expense) relatively fast, and habitually understand patterns within your business.
Three Fundamental Keys for Amazon Seller Accounting
Aside from understanding the basics of E-commerce accounting, all Amazon sellers must also be aware of the issues their business may face throughout their operation. Here are the three notable areas of concern for online sellers when accounting for their online businesses that need to be addressed for them to succeed:
- Accurate Representation of Sales Accounts,
- Accurate Representation of Inventory and Cost of Goods Sold Accounts; and,
- Regular Tax Compliance
The use of accounting software is not 100% guarantee to be enough to address these key areas in accounting for your business. To address issues of accurate data for your business, Online Seller’s CPA provides great accounting services for e-commerce sellers out there.
From accounting services to tax advisory and accounting systems assistance, we at Online Seller’s CPA offer our services to online retailers to ease your accounting activities and digitizing your work for your convenience.
You can contact us at 305-767-7408 or visit us at The online seller CPA for inquiries on our services today.
