Amazon accounting is a specialised area of expertise. It often differs from traditional accounting in its complexity and processes. An accountant serving an Amazon business will need to not only have a thorough understanding of the accounting process, but also of the Amazon platform and how it works. Thus, accountants for Amazon sellers are harder to come by than traditional accountants.
Amazon seller accounting also requires using specialist accounting software that gathers and categorises Amazon sales data. Therefore, Amazon accountants need to be tech savvy too.
Key Takeaways from this Post
Join us as we go through your different options for finding and choosing a specialist eCommerce accountant to manage your Amazon business accounts. Plus, we'll answer a couple of FAQs towards the end.
75% of Amazon Sellers Make Bookkeeping Mistakes
Yes, you read that right. 75% of Amazon sellers make some form of error in their bookkeeping and accounts. Link My Books has worked with more than 8,000 businesses since 2018. And, this is the reality of bookkeeping as an Amazon seller.
Even small errors in your books can lead to detrimental tax mistakes for e commerce businesses, particularly if these small errors are reoccurring. Tax authorities can issue penalties and fines, for both accidental mistakes in tax returns and purposeful ones. This, of course, leads to wasted money, time, and even a blow to your Amazon FBA business's reputation.
The answer to this predicament is to either subscribe to powerful accounting software or work with accountants specifically for Amazon sellers. These accountants will have had appropriate training or experience dealing with Amazon business accounts. They may also use cloud accounting software that is tailored to eCommerce accounting or Amazon accounting services.
Why Bother With Specialist Amazon Accountancy Services?
- Save time and money: Hiring accountants for Amazon sellers might be an additional cost. However, it can save you a lot of time. And, as I'm sure you know, time very often equals money in the world of business. You'll have more time to focus on growing your Amazon business without needing to deal with the intricacies of accounting.
- International tax compliance: If you sell products in different countries, tax rules and regulations will differ from country to country. It's an accountant's job to ensure you comply with the applicable regulations. Working with knowledgeable Amazon accountants will help you remain compliant, regardless of where you sell your products.
- Business growth: Knowing that you're complying with the right tax obligations can give you the confidence to branch out into different markets. Working with Amazon accountants can also help you grow and scale your business by taking some of the load of your shoulders. They can analyse key data to generate reports that'll help you maximise your revenue. In short, you can concentrate on selling and marketing, while they deal with your books and taxes, and analyse your cash flow.
Amazon Accounting Specialist vs Generalist
eCommerce space, specifically Amazon. Here are a few ways in which Amazon FBA accounting differs from general or traditional accounting:
- Payment timeframes: In general accounting, an accountant will analyse the money going into your bank account as you make a sale. However, with Amazon FBA, payments can take up to two weeks to hit your bank account. This means that payments will always be behind sales, sometimes significantly. Understanding this is key to proper financial forecasting and generating accurate, helpful cash flow reports.
- Expenses: Amazon sellers have different expenses to, for example, a brick-and-mortar store. They have Amazon fees and shipping to pay. Additionally, they might run Amazon ads, and use inventory tracking management software and other online tools to help their business thrive. A traditional accountant will not normally work with these expenses.
- The bigger picture: Amazon sellers often sell on multiple platforms. It takes a streamlined system to ensure all your accounts and data line up. Without the right software and know-how, things can get complicated very quickly. An Amazon seller accountant will understand how to consolidate the data from your various eCommerce businesses to create a unified set of accounts.
- Managing inventory: Managing inventory is a crucial aspect of Amazon seller accounting. It's important to know the value of your inventory at any given time. Inventory management tools can also help with sales forecasts, cash flow forecasts, and other reports. These reports should give you a clear and detailed overview of your e commerce business and help you make business-boosting decisions.
How to Find an Amazon Accountant
- Navigate to linkmybooks/experts
- Scroll down to the filter options
- Check 'Amazon' in the Sales Channel' drop down menu
- Select your other preferences like Advisor Type and Country
- Look through the list of expert accountants for Amazon
Step #1: Navigate to linkmybooks.com/experts
Link My Books is a specialised software that connects your Amazon seller account to your accounting software. It exports the data in clean summaries that include details like sales, profit & loss, fees, refunds, COGS, and tax.
We have partnerships with a number of reputable and approved accountants. As we're eCommerce-focused, all our partners are expert eCommerce accountants. They're all thoroughly vetted before they make onto our list.
So, navigate over to linkmybooks.com/experts to discover the best accountants for Amazon sellers.
Step #2: Scroll Down to the Filter Options
You can filter our selection of eCommerce business accountants to find exactly what you're looking for. This process is really easy and will show you your respective options as you narrow them down.
Step #3: Check 'Amazon' in the 'Sales Channel' Drop Down Menu
Locate the Sales Channel drop down menu and check the 'Amazon' box. All the accountants under the search bar will now be those that offer professional Amazon accountancy services or bookkeeping services. If you sell on multiple platforms, for example eBay and Shopify as well, you can check those boxes too.
Step #4: Select Your Other Preferences
Link My Books' search function allows you to narrow your options down even further so that it shows you exactly what you're looking for. Here are the filters you can apply/choose:
- Advisor Type: Accountant or bookkeeper. If you don't know the difference, a bookkeeper gathers, categorises, and manages your financial data while an accountant analyses and interprets it. An accountant can perform bookkeeping tasks as well, and sometimes vice versa. Think of bookkeeping as the first step in the accounting process.
- Accounting Platform: Choose either Xero or QuickBooks. Link My Books integrates with both of these. You might be using a particular platform already. Or, you might speak to your accountant about the right one for your Amazon store when you contact them.
- Country: Choose Australia, Canada, United Kingdom, or the United States. You can select multiple countries if applicable to your Amazon FBA business.
- Services: Our partnerships can provide a one-off Link My Books setup, a monthly bookkeeping service, or a full accounting service. Choose which one you want.
Step #5: Look Through the List and Choose Your Expert
Once you've narrowed down your choices, you can look through your available Amazon accounting expert options. Click on each of our trusted partners to learn more about them and their services. This will tell you their location, who they are, and who their clients are. You may also see some client testimonials displayed underneath.
You can contact each accountant directly though our website. Or, click on 'View Website' to browse their site and learn even more about their approach to accounting for Amazon sellers.
Let Link My Books Help
Alternatively, Link My Books can take over this task by matching you with the perfect accountant. Simply click on the 'Get Matched' button in the orange box, fill out a form with details of your business, and we'll get back to you with your ideal match.
What to Look for in an Amazon Accountant
Knowledge and Experience
The main thing you want to look for is their level of knowledge and experience. They should have plenty of experience with working closely with Amazon sellers and understand all the different intricacies of the Amazon marketplace and platform. A good Amazon accountant will communicate their expertise with you effectively.
Read blogs, reviews, and different web pages to gain a full picture of a firm's background. It should be clear they know what they're talking about. And, know the Amazon seller accounting game inside out.
You might also look for credentials and certifications. If there are any, they'll likely be proudly displayed on the website. Additionally, an 'About Us' page will give you more details on the company's background. You might also look at an 'Our Team' page or similar to get to know the individuals working there and their expertise.
Knows Their Software
Software plays a significant role in e commerce accounting. An Amazon accountant won't shy away from using cloud based software to create a unified system. In fact, they'll embrace it! Look at what tools each accountant or firm is familiar with to gauge their software confidence.
You want your Amazon FBA accountant to be easily reachable and communicative. Begin with looking at reviews of the firm or individual. Then, once you've honed in on your top choice, simply send them an email to see how long they take to reply. Once you get your first reply, keep the conversation going while you ask your questions (more on those later) and get a thorough understanding of who they are, how they work, and what they can do for FBA sellers.
You might also note what methods of communication they use. It's unlikely you'll find a local Amazon accounting firm. Therefore, it's important that they provide ways to communicate with them effectively. Through Skype, for example, or perhaps through regular scheduled Zoom calls.
Questions to Ask a Potential Amazon Accountant
Your cheat sheet:
- What Amazon accounting software are you confident in using?
- How many Amazon sellers have you worked with?
- What size Amazon businesses do you work with?
- Do you use a specific accounting software, such as Xero or QuickBooks?
- How can I reach you and what is your usual time-frame for replying to emails?
- Do you have experience working with international Amazon sellers?
- What specific services do you provide? E. g. reports for managing cash flow, VAT registration, tax returns etc.
- How do you ensure you manage Amazon accounts in the most tax efficient way?
- If I were to expand my business into other areas of eCommerce, do you have the expertise to manage those too?
- What is your pricing structure?
- What do you need from me, both before we begin and on an ongoing basis?
When is the Right Time to Hire an Amazon Accounting FBA Specialist?
If you've just launched your Amazon business, you probably wont need an Amazon accounting FBA specialist just yet. While their business is small and their sales volume is relatively low, most Amazon businesses can manage well by themselves, providing they have a cloud based accounting software to help them. Also consider purchasing a software subscription like Link My Books that automatically transfers your sales data to accounting software.
You'll certainly benefit from an expert accountant when your business grows though. As you make more money and sales, and also expand to different platforms and marketplaces, an accountant will help you enormously in managing your business's finances and tax efficiency.
Challenges of Using an Amazon Accountant
- In high demand: Back in 2021, there were an estimated 9.5 million Amazon sellers across the world. The question is then, how many accountants have expanded their skills to keep up with this trend? This number is likely to be relatively small compared to the number of Amazon stores. Therefore, you should prepare for Amazon accountants to be in high demand.
- Communication: As touched upon earlier, you'll be lucky to find a specialised Amazon accountant in close proximity to you. Unless, of course, you live in a big city like London. This can make communication difficult for some people who prefer face-to-face interactions.
- Genuine experience: You need to look for client testimonials and certifications to verify an accountant's expertise. While it would be great if everyone was entirely upfront about their skills and experience, unfortunately, we know it's not always the case.
Is it Better for Amazon FBA sellers to Manage Their Books themselves?
The answer to this depends on your business size and your level of accounting experience. If you're confident with doing accounting for your Amazon seller business, there's nothing at all stopping you.
Just make sure you equip yourself with powerful cloud based accounting software for Amazon sellers. And, any other automation software that will make your job easier. For example, inventory apps. We would, however, advise that you only keep going while you feel confident to do so. Don't put yourself under any unnecessary strain, whether that's through a lack of time, skills, or knowledge.
A lot of time goes into running an Amazon FBA online business. You need to make sure you're spending a decent amount of time expanding your business, communicating with customers, researching products, and running ads. If you're trying to do it all yourself, ask yourself why and weigh up the pros and cons of outsourcing some tasks.
In short, reach out to professional accounting services before it all gets on top of you. Even the best accounting software in the world won't completely take over the accounting process. It will always need a degree of human input to check for accuracy and interpret data.
How Much do eCommerce Accountants Charge?
This is a question on many a business's mind. However, the answer is far from straightforward. The charge depends on the size of your business, the services you need, and the firm's individual pricing structure. For example, they might charge on an hourly basis or have a subscription-based pricing model.
Crunch, for example, has a subscription plan that charges sole traders 1% of their earnings. Or, from £43.50 + VAT per month for a limited company.
You need to speak to different firms to find a price that suits you and your specific requirements. Also check for hidden costs to avoid any nasty surprises.
Key Takeaways on Finding an Amazon Accountant
- Find reputable Amazon accounting experts at linkmybooks.com/experts.
- Check a firm's reputation and skills by reading customer reviews and asking applicable questions.
- Find out what software combinations an accountant uses to simplify their processes.
Streamline Your Amazon Accounting Today (Save Hours Every Month)
Whether you're flying solo or working with an accountant, Link My Books can save your business (or accountant) hours every month. By automatically consolidating and exporting data to your accounting software, it streamlines your Amazon Accounting for a smooth and efficient system. You can connect up to ten different e commerce businesses to Link My Books. This provides financial clarity for your business to help you make profitable decisions.
Bag a free Link My Books trial today and take control of your Amazon FBA finances.