The rise of accessible technology has spawned a wave of opportunities across multiple business sectors, yet there may be none more impactful than the rise of eCommerce software providers.
Over the past ten years, this landscape has transformed from a small bubble of lesser-known companies to a behemoth of multinational corporations.
Still, names like Amazon, eBay, Kogan and Woolworths aren't the only ones benefiting from this rapid expansion, nor are they the sole organisations that require help with their bookkeeping needs.
Across Australia, hundreds of eCommerce operations - large and small, seek outsourced financial experts to help them manage their breakneck growth.
This article will look at how bookkeeping experts, like Sydney's Numeric Eight, can help eCommerce businesses enjoy new successes without encountering roadblocks.
1. Bookkeeping Integration is a Massive Improvement
New companies will soon discover a seemingly infinite selling potential when introduced to the world of online retail. Digital marketplaces haven't only made this route incredibly accessible to sellers, but they've also made it arguably more attractive to buyers than traditional "brick and mortar" purchasing methods.
Operations will need a way to integrate their accounting methods and systems quickly and efficiently to meet the growth in demand. Everything from cash flow to budget forecasting will need to be correctly managed — something that can be outside of the scope of most businesses' capabilities.
This is where a bookkeeping service provider comes into play. Rather than fumble with disparate, disconnected, outdated systems, an organisation can simply transfer their finances to a larger, experienced team of experts with the solutions necessary to oversee every aspect of its accounting function.
For instance, some of Numeric Eight's integrated services include:
Accounts receivable and invoicing
Setting up & processing payroll/payroll taxes
Comprehensive profit and loss reporting
Software platform migration and integration
Having a department dedicated to these needs can drastically increase workplace capacity and prevent organisations from experiencing growing pains that ruin their momentum.
2. Enhanced Inventory Management Spurs Growth
eCommerce businesses are interesting ventures, as inventory can be held in warehouses located thousands of kilometres away from headquarters in different States or Countries.
This can either be a blessing or a curse depending on how efficiently inventory is managed. Since the operation primarily revolves around proper stock handling, partnering with a separate department is one of the best ways to keep inventory tracking as accurate as possible, even as it undergoes expansion.
A finance expert will know the best methods to track and report your inventory for bookkeeping and tax purposes — even if it's being held overseas.
3. Comprehensive Bookkeeping Coverage Enables International Growth
Speaking of multinational operations, an experienced bookkeeping services provider can also help an eCommerce business prepare, execute, and maintain a strategy for overseas growth.
Since the main draw of this approach is to enable purchases from anywhere in the world, businesses must be aware of intricacies such as shipping costs, sales tax, transactional data, international money transfers and more. All of which may be processed uniquely in different marketplaces and countries.
Understanding how to condense this complex data is a massive task most teams don't have the capacity to face alone. However, with an accounting team at their side, they can craft a comprehensive bookkeeping system that creates individual line items for different marketplaces, reduces costs associated with transactional fees or returned/lost products, and more.
These constraints can be experienced locally, but there are some specific to eCommerce businesses operating internationally, particularly regarding taxes. Therefore, besides the services above, a bookkeeping partner will also be the go-to expert for understanding international and indirect taxes, currency exchanges, import duties, and other associated expenses.
Integrated eCommerce Systems - A Practical Example
Using the correct bookkeeping and accounting systems together in your eCommerce business will streamline your processes, enable scalable growth, and transform how you operate.
In this example, we'll demonstrate how Numeric Eight helped Haverford Brands improve operations by transitioning from inefficient, disjointed manual processes to an efficient, integrated network of software solutions that talk to one other and support growth, transparency and efficiency within its business.
Haverford relied heavily on manual work to manage their bookkeeping and finance functions before Numeric Eights' involvement. For example, inventory was recorded on Excel spreadsheets and manually entered into MYOB, which was time-consuming and error-prone and meant that there was no real-time visibility of stock. The eCommerce payment gateways were also disconnected, resulting in confusion about which payments had been received and the inability to reconcile lump sum payments against each invoice. Haverford Brands quickly realised that these processes were not sustainable or conducive to a fast-growing business.
Numeric Eight set up various new systems and integrations to transform operations. After discussions with the Haverford Brands executive leadership, a decision was made to migrate to Xero from MYOB, as Xero was better suited to a transactional eCommerce business.
Cin7 was introduced as the new inventory management system because it provides Haverford Brands with a live view that syncs with Xero, making reconciliations and tracking easier. It also offers a dashboard of sales in real-time, resulting in better stock control, visibility and analysis.
The introduction of these software applications allowed Haverford's business processes to be integrated, with Cin7, Xero, 3PL warehousing (local and offshore), CRM, eBay, and Shopify systems syncing and talking to each other seamlessly.
Learn more about how Numeric Eight went beyond bookkeeping to help Haverford Brands in this case study.
Though eCommerce is an exciting and profitable landscape, it is not without its fair share of complex requirements. Fortunately, an outcomes-based bookkeeping expert like Numeric Eight can help any business in the sector enjoy long-term growth thanks to scalable services.