How to Find an eCommerce Accountant? (And What to Look For)

Struggling to handle the financial complexities of your eCommerce business? We've been there - navigating sales tax, income tax, and inventory can be a nightmare. This is where an eCommerce accountant comes into play, their expertise tailored to meet the unique needs of online businesses like yours.

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‍Most People are Focused on Numbers, Look for a Partnership  

When it comes to effectively managing your eCommerce business, the role of an accountant extends far beyond simply gathering sales data from various channels, inputting it into accounting software for bookkeepers like Xero or QuickBooks, and handling tax returns and annual accounts. While these tasks are important, they can now be partially automated by software solutions specifically designed for e-commerce businesses.

So, what value does an accountant bring to your business in this digital age? Instead of being solely focused on administrative and transactional duties, you need an accountant who can provide business insights and act as your trusted finance advisor.

A skilled eCommerce accountant can help you gain a deeper understanding of your business performance by analyzing key financial indicators, generating reports, and highlighting trends and patterns. They have the expertise to interpret the numbers and metrics, providing you with meaningful insights into your revenue streams, profit margins, expenses, and cash flow.

Moreover, an accountant with experience in the e-commerce industry can help you navigate through the complexities of online selling and various marketplaces. They can assist in identifying cost-saving opportunities, optimizing pricing strategies, managing inventory effectively, and ensuring compliance with tax regulations specific to e-commerce.

Beyond their financial expertise, an eCommerce accountant can act as your virtual finance director. They can collaborate with you in setting strategic goals, devising growth plans, and making informed financial decisions. By leveraging their industry knowledge and analytical skills, they become a valuable partner who can guide you in streamlining operations, mitigating risks, and maximizing profitability.

What is an E-commerce Accountant?

An e-commerce accountant is a professional who offers accounting and bookkeeping services to businesses that sell services and products online.

Most e-commerce accountants are Certified Public Accountants (CPAs) with the experience and knowledge to create, organize, analyze, and manage e-commerce financial documents.

Note that individuals or firms may offer e-commerce accountant services. An individual account may offer services as a freelancer or an employee of an e-commerce company.

On the other hand, e-commerce accounting firms hire their own accountants on a freelance or salaried basis. These professionals offer accounting services to clients under the firm's supervision.

Do You Need an eCommerce Accountant?

Are you an eCommerce business owner struggling to manage your financials? An eCommerce accountant can provide the expertise and guidance you need in navigating the complexities of online selling. In 2022, we saw an influx of eCommerce sellers who were left in no mans land when GoDaddy Bookkeeping announced it's closure. A lot of those sellers made the switch to using an eCommerce Accountant and haven't looked back since!

Here are three reasons to highlight how an eCommerce accountant can help to streamline eCommerce accounting processes:

Safeguarding your Tax Practices

You might be good at selling products online. But tax rules can make your head spin. An eCommerce accountant knows these rules well. They will keep you out of trouble with the law.

Having a skilled person in charge of numbers is smart for your business!

Investment

We all know that handling money can be tricky. As an eCommerce business owner, you deal with cash flow daily. You have sales coming in and bills to pay out. A good accountant helps you keep track of it all.

They make sure your money is working for you and not against you.

Using an e-commerce accountant makes tax time easier too. They know the laws for online shops like yours. They can find deductions that save you money on taxes! It's another way they help your store succeed.

Scalability

Your online store may get bigger. This is good news! But it also brings complex tax rules and laws. An eCommerce accountant can help you here. They know all about tax rules for different states or countries.

This means you will not break any laws by mistake. Also, they make sure you pay less tax while staying fair and correct.

Role of an Ecommerce Accountant

Now that we have seen that you do need an e-commerce accountant, let's check out what roles they play in your business.

Accountants for e-commerce businesses play the following four major roles:

1. Bookkeeping

Bookkeeping forms the basis of great accounting. While bookkeeping and accounting are often interchanged, the two roles differ. However, hiring an accountant who can also help you with bookkeeping is best.

Here are some bookkeeping tasks an accountant helps you with:

• Tracking returns
• Collecting debts
• Processing payroll
• Managing inventory
• Sorting out invoices and bills
• Keeping transaction records and summarizing data
• Tracking and categorizing e-commerce transactions into expenses, incomes, debts, receipts, payroll, payment of bills, and sales

2. Accounting

E-commerce accounting starts where e-commerce bookkeeping ends because it builds up on the results of bookkeeping.

Your accountant should be able to perform accounting skills such as:

• Creating, analyzing, and interpreting key e-commerce financial documents, such as cash flow statements, profit and loss statements, balance sheets, and income statements
• Conducting or overseeing e-commerce audits to ensure financial documents are accurate and legitimate
• Helping you with bank payment reconciliation and processing debit or credit cards
• Maintaining accurate e-commerce accounting records for past durations

3. Tax Management

E-commerce accountants double up as e-commerce tax accountants and offer the following services:

• Preparing tax documents
• Filing annual tax returns
• Filing tax returns every quarter
• Distributing 1099 forms to your contract workers
• Helping you save money by reducing your tax burden
• Examining, analyzing, and interpreting accounting records
• Tracking and paying all local and state taxes, such as sales tax
• Advising you on tax matters like tax obligations, regulations, and compliance

4. Growth Planning

Besides basic bookkeeping and accounting, an e-commerce accountant doubles up as a strategic partner who helps scale your business through tasks such as:

• Financial benchmarking through measuring your business's success and evaluating if you should invest in other areas or ways, such as buying out your competitors
• Analyzing your business's strengths in terms of its most profitable services or products, its profit development, and its biggest liabilities and expenses
• Financial planning through budgeting, cost reduction, revenue forecasting, and enhancing operational efficiency
• Analyzing the opportunities your business has for increasing its profit margins
• Providing financial and business advice using data-informed insights
• Providing risk analysis

From these many roles, you can draw several benefits of having an e-commerce accountant.

Key Benefits of Hiring an Ecommerce Accountant

Here are the key benefits you can enjoy when you hire and work with an e-commerce accountant:

• E-commerce accountants help you understand the financial health of your business through accurate bookkeeping and accounting.
• The accountant helps you comply with industry regulations, saving you money you would otherwise spend on fines or penalties.
• You can tap into their insights to identify opportunities to increase sales, cut costs, and maximize profits.
• E-commerce accountants provide convenience in relieving you of the stress of accounting, filing taxes, and bookkeeping so you can focus on growing your business.
• You can better plan your business because the information the accountant gives you helps you plan better for payroll, taxes, debt payments, and even selling your business if need be.

When to Start Using an eCommerce Accountant

If you're an eCommerce business owner, there are a few signs that indicate it's time to start using an eCommerce accountant. One sign is when your business starts generating substantial revenue and the financial aspects become more complex.

Another sign is if you find yourself struggling to keep up with bookkeeping tasks like tracking expenses, managing inventory, and reconciling accounts. Lastly, if you're unsure about tax laws and regulations specific to eCommerce businesses, it's a good idea to seek professional help from an accountant who specializes in this area.

Remember, by hiring an eCommerce accountant early on in your business journey, you can avoid costly mistakes and ensure your financial records are accurate and compliant with tax obligations.

Top 3 Tools for E-commerce Accountants

You'll want to use only the best tools as an e-commerce business owner or accountant to get the best accounting results. Here are the top three tools you can use:

1. Link My Books

A game-changer for e-commerce businesses, Link My Books is a bookkeeping automation tool that handles sales, fees, taxes, and refunds across multiple e-commerce platforms like eBay, Amazon, and Shopify.

Link My Books Features

You can enjoy the following features with our tool:

• Automatic E-commerce Accounting: Since our software streamlines bookkeeping, you are assured of accurate accounting across all transactions.
• Automated Payment Reconciliation: The software streamlines the payment reconciliation process by ensuring your bank deposits match customer payments and refunds.
• Multi-tax Support: Depending on the country, you can use our tool to comply with Sales Tax, GST, and VAT.
• Autopilot COGS Tracking: You can track the cost of goods sold (COGS) on autopilot as you clear your inventory.
• Multi-platform Integration: Besides accounting software like Xero and QuickBooks, you can connect to various selling platforms like Etsy, Amazon, Walmart, Square, and even TikTok Shop.

Book a free trial today to learn more about how Link My Books can help you run e-commerce bookkeeping and accounting on autopilot.

Link My Books Benefits

You can enjoy the benefits below when you use our bookkeeping tool:

• Cost and Time Efficiency: The software’s automation features save you time and money, which you can use in other business areas to ensure better success.
• Compliance: The tool lowers the risk of human errors, which helps you maintain tax compliance.
• Ease of Use: The software is user-friendly, and the customer care is responsive.
• Informed Business Decision-making: The benchmarking feature makes it easy to make informed decisions. It shows you how your business stacks up against competitors. The Financial Analytics feature is also a great source of powerful internal insights.

2. Zoho Books

With Zoho Books, you can manage your bookkeeping requirements from a single location, performing tasks such as reconciling bank statements, controlling spending, and clearing invoices and bills.

Some key features of the tool include task automation, customization of purchase and sales templates, data importation, and document management.

3. ConnectBooks

ConnectBooks is an accounting and bookkeeping software that supports features such as inventory management, bank payments reconciliation, expense and fee tracking, and data syncing.

E-commerce Accounting Best Practices

Whether you are just starting or managing several online stores already, you'll want to follow proper accounting best practices to smoothen your operations.

Here are some practices to consider:

1. Ensure Excellent Bookkeeping: As mentioned, bookkeeping is the basis of accounting. Strive to keep accurate and correct records of your sales, expenses, income, and purchases.

2. Automate Your Processes: It's easy to do bookkeeping and accounting on autopilot using modern technology. Automation saves you time and reduces the risk of errors that may cost you extra money.

3. Reconcile Your Accounts Regularly: You must regularly compare your bank records with your financial statements to ensure they match. You'll also be able to notice mistakes early and correct them in good time.

4. Understand E-commerce Taxes: Taxes for e-commerce business activities are complicated and require understanding your obligations to ensure you collect and remit the right types and amounts.

5. Always Track Your Inventory: Overselling is a common problem for e-commerce businesses. You'll want to track your inventory properly to always know what you have remaining, what isn't selling, and what is.

6. Always Track and Monitor Your Cash Flow: Check to ascertain that your e-commerce cash flow is positive, which shows financial health. If it's negative, take the necessary measures to amend the situation.

How to Find an eCommerce Accountant

In this section, we will provide a step-by-step guide on how to find the perfect eCommerce accountant for your business. Read on to learn more!

Step 1: Determine Your Needs and Budget

To find an eCommerce accountant, the first step is to determine your needs and budget. Consider what specific accounting services you require for your online business. Do you need help with bookkeeping, tax preparation, or financial analysis? Knowing your needs will help you find an accountant who specializes in eCommerce and can provide the services you require.

Next, consider your budget. How much are you willing to spend on accounting services? Keep in mind that different accountants may have varying fees based on their experience and expertise.

It's important to set a realistic budget so that you can find an accountant who fits within your financial means.

Step 2: Research and Compare Accountants

When looking for an eCommerce accountant, it's important to do thorough research and compare your options. Here are the steps you can follow:

1. Look for accountants who specialize in eCommerce: Find accountants who have experience and expertise in working with eCommerce businesses.
2. Consider their qualifications: Check if the accountants are certified or hold relevant qualifications such as being a Certified Public Accountant (CPA).
3. Read client reviews and testimonials: Look for feedback from other eCommerce business owners who have worked with the accountant to get an idea of their reputation and quality of service.
4. Schedule consultations or interviews: Speak directly with potential accountants to discuss your needs and assess their knowledge and understanding of eCommerce accounting.
5. Evaluate communication and compatibility: Ensure that you can communicate effectively with the accountant and that they understand your business goals and objectives.
6. Consider pricing and fees: Compare the costs of different accountants' services, keeping in mind factors like the complexity of your business structure, transaction volume, and the level of support you require.
7. Make your final selection: Based on all these factors, choose an accountant who meets your needs, has experience in eCommerce accounting, fits within your budget, and is compatible with your business.

Step 3: Check for Specialized Experience and Qualifications

When looking for an eCommerce accountant, it's important to check if they have specialized experience and qualifications. You want someone who understands the unique challenges and requirements of eCommerce businesses.

Look for accountants who have worked with other eCommerce companies or have specific certifications in eCommerce accounting. This expertise will ensure that they can effectively manage your financials and help you navigate any tax or compliance issues that may arise.

Remember, don't settle for just any accountant - find someone with the right skills and knowledge to support your eCommerce business.

Step 4: Review Client Reviews and Testimonials

To find the right eCommerce accountant, it's important to check client reviews and testimonials. Look for feedback from other businesses who have worked with the accountant you're considering.

Their experiences can give you a better idea of what it's like to work with that accountant and whether they provide good service. Take note of any positive or negative comments about their expertise, reliability, and communication skills.

By reviewing client reviews and testimonials, you can make a more informed decision about which accountant is the best fit for your eCommerce business.

Step 5: Schedule Consultations or Interviews with Potential Accountants

To find the right accountant for your eCommerce business, it's important to schedule consultations or interviews with potential candidates. This will allow you to have a conversation and get a better sense of their expertise and how well they understand your specific needs.

During these consultations or interviews, you can ask them questions about their experience working with eCommerce businesses, what services they offer, and how they can help you with your financial needs.

This interaction will also give you a chance to evaluate their communication skills and determine if there is compatibility between both parties. Set up appointments with several accountants so that you can compare and make an informed decision based on who meets your requirements the best.

Step 6: Evaluate Communication and Compatibility

When choosing an eCommerce accountant, it's important to consider how well you communicate and work together. Find someone who understands your needs and is able to explain complex financial concepts in a way that you understand.

It's also crucial to assess their compatibility with your business goals and values. Look for an accountant who aligns with your vision and can provide the support and guidance you need as your eCommerce business grows.

Step 7: Consider Pricing and Fees

When choosing an eCommerce accountant, it's important to consider pricing and fees. Look for an accountant who offers transparent and reasonable pricing that fits within your budget.

Compare the rates of different accountants to make sure you're getting a fair deal. Keep in mind that while price is important, it shouldn't be the sole factor in your decision-making process.

Consider the value and expertise that the accountant brings to the table as well. By carefully considering pricing and fees, you can find an eCommerce accountant who meets your financial needs without compromising on quality.

Step 8: Make Your Final Selection

To make your final selection, evaluate all the information you have gathered. Consider factors like their experience, qualifications, and client reviews. Schedule consultations or interviews with potential accountants to get a sense of their communication style and compatibility with your business.

Don't forget to take pricing and fees into account as well. After careful consideration, choose the eCommerce accountant who best meets your needs and budget. Trust yourself to make the right decision for your business.

What to Look for When Finding an Accountant for eCommerce

When seeking an accountant for your eCommerce venture, it's imperative to identify specific qualities and competencies that ensure a harmonious fit for your business. Read on to explore these attributes and how they can substantially benefit your operations. It can be hard to know exactly what an eCommerce accountant does, but we’re here to guide you! 

Expertise in eCommerce Accounting

In your quest for an eCommerce accountant, a pivotal characteristic to prioritize is their expertise in eCommerce accounting. This proficiency entails a profound understanding of the distinctive financial intricacies and requisites linked with managing an online store.

Look for an accountant well-versed in platforms like Shopify or WooCommerce, and possessing experience in navigating challenges such as inventory management, sales tax adherence, and payment processing. With specialized knowledge in eCommerce, this accountant will furnish you with customized advice and strategies to optimize your business's financial robustness.

Meticulous Attention to Detail

When selecting an eCommerce accountant, another paramount trait to consider is their unwavering attention to detail. An accountant marked by meticulous attention to detail meticulously scrutinizes and analyzes your financial records, ensuring utmost precision and compliance with pertinent tax regulations.

Their diligence extends to identifying potential discrepancies or errors, acting as a safeguard against possible penalties or audits. Armed with their keen eye for details, they are poised to provide you with accurate financial reports and insights, thereby empowering well-informed business resolutions.

Effective Communication and Compatibility

When enlisting the services of an accountant for your eCommerce enterprise, evaluating their communication skills and compatibility holds profound significance. It's imperative to engage an accountant capable of seamless correspondence and attuned to your particular needs and objectives.

Search for an accountant who is prompt in responses, easily reachable, and receptive to comprehending your concerns. Furthermore, ensure that you experience a sense of ease and confidence in collaborating with them on a consistent basis.

Establishing a robust working rapport with your chosen accountant is pivotal for securing the necessary support that guarantees the enduring triumph of your eCommerce enterprise.

Strategic Financial Insight

An accountant who specializes in eCommerce brings far more than traditional accounting prowess. They possess the capacity to serve as your virtual Chief Financial Officer (CFO) or Finance Director (FD), providing astute guidance and advice for the financial facet of your business.

In addition to ensuring compliance and accuracy, these professionals offer a strategic perspective on your financial data. They help you decipher profitability trends, seize growth prospects, and offer comprehensive financial counsel that empowers you to make informed, strategic choices.

The insights provided by an eCommerce-focused accountant contribute to the robust growth and resilience of your online business.

Parting Advice for Finding the Right eCommerce Accountant

In your search for the right eCommerce accountant, remember to thoroughly research and compare accountants, check for specialized experience and qualifications, review client reviews and testimonials, schedule consultations or interviews with potential accountants, evaluate communication and compatibility, consider pricing and fees, and make your final selection based on these criteria.

The Challenge for eCommerce Business Owners

Running an eCommerce business can be challenging, especially when it comes to managing your finances. This is where finding the right eCommerce accountant becomes crucial. But how do you know if you need one? Well, as discussed there are a few reasons why hiring an eCommerce accountant makes sense.

eCommerce Accountants: Your Path to Profitability

In the realm of eCommerce, the right accountant isn't just a financial manager; they are a strategic partner that can lead your business towards increased profitability. We've walked you through a comprehensive roadmap to finding the ideal eCommerce accountant, each step aimed at ensuring your financial success.

From understanding the pivotal role of an eCommerce accountant and recognizing the optimal time to bring one aboard, to dissecting the process of selection - we've covered it all. But what truly sets an exceptional eCommerce accountant apart?

Elevating Savings and Business Potential

A standout eCommerce accountant possesses the expertise to not only navigate financial intricacies but also uncover opportunities for saving that can lead to exponential growth. They master the nuances of tax efficiency and compliance, making sure you're on the right side of every financial regulation.

But their impact doesn't halt at tax season; they are the ones who transform your financial data into a roadmap for growth. By understanding your business's profitability and growth opportunities, they enable you to make informed decisions, effectively becoming your virtual CFO or FD.

The Clear Sign of Value

Here's the clincher: a good eCommerce accountant isn't an expense; they are an investment. Their insights, advice, and meticulous attention to detail save you money, making them a driving force behind your bottom line. They provide a perspective that transcends routine bookkeeping, steering your business towards strategic and financial success.

If you're ever met with the nagging feeling that your current or prospective eCommerce accountant isn't truly delivering value, consider it a clear sign to explore other candidates. Your accountant should not be a mere line item; they should be the partner in profit growth.

In conclusion, the journey to finding the right eCommerce accountant is a critical one. By seeking those with expertise in eCommerce accounting, an unyielding focus on detail, effective communication, and strategic financial insight, you're poised to unlock a wealth of benefits that translate into tangible financial gains. Remember, your accountant should contribute to your business's success, not just file its accounts.

Automate Your E-commerce Accounting With Link My Books

Tired of manual bookkeeping? Want to focus on growing your e-commerce business instead? Link My Books is your solution. With seamless integrations to Amazon, eBay, Shopify, and more, we've got you covered. Start Your Free 14 Day Trial Now!

Frequently Asked Questions (FAQs)

Let's check out some common questions you may have about e-commerce accountants.

How Does an Ecommerce Accountant Help in Financial Planning?

An e-commerce accountant analyzes your business's financial status and provides detailed insights into its performance through metrics such as profit margins, sales, and the cost of acquiring new customers. These insights are important as they inform your business decisions.

Additionally, your accountant can help you attract investors or enhance the confidence of your current stakeholders through timely and accurate financial reporting.

What Skills Are Essential for an Ecommerce Accountant?

A great e-commerce accountant should have the following skills:

• E-commerce budgeting
• E-commerce inventory control
• E-commerce payroll management
• Communication, organization, and collaboration skills
• Technology proficiency, especially with e-commerce accounting and bookkeeping tools
• Adequate knowledge of e-commerce marketplaces, accounting systems, and payment systems
• Legal compliance knowledge, including understanding of tax returns, tax preparations, and sales tax
• Financial management, including financial problem-solving, sales analytics, document management, information security, and fraud prevention.

How Does an Ecommerce Accountant Handle Inventory Management?

An e-commerce accountant tracks purchase orders, returns, and sales to ensure you don't oversell your inventory. These data help you make informed decisions, such as when to reduce stock or order additional goods.

The accountant also creates and optimizes measures for controlling your inventory to ensure a balance between having enough stock to fulfill demand and avoiding unwanted holding costs from keeping too much inventory.

To make inventory management easy, accountants often create a ledger to track the quantities and costs of goods sold.

What Other Software is Commonly Used by Ecommerce Accountants?

Bookkeeping and accounting software are a must-have for e-commerce accountants, whether they work individually or as part of an accounting firm.

Most accountants use Link My Books to automate their bookkeeping and accounting processes for their clients, especially because of the tool's handy profit analytics feature and exceptional customer service.

Conclusion

To improve your chances of success, you'll want to hire only the best e-commerce accountant to help you with accounting and gather business insights into how you can grow your business.

If you have been keeping your books manually, it is advisable to equip your accountant with Link My Books to automate your bookkeeping and accounting processes.

With our automation tool, you can have it all, from multi-channel integrations to Xero and QuickBooks connectivity. Set up a free demo today to see how to file your accounts faster and more accurately!