Do You Need an Ecommerce Accountant?

Are ecommerce accountants different than regular accountants?
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Should you have an accountant that has previous ecommerce experience for your online business?

These kinds of questions are becoming increasingly common with the dramatic rise in ecommerce business. In 2020 alone US ecommerce grew by more than 32% as traditional brick-and-mortar companies made the transition online and new ecommerce businesses started up in record numbers. 

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Amid this digital push business owners selling online began to analyze their own online operations, asking clarifying questions like:

• Do I have the knowledge base to understand the financial nuances of selling online or do I need a dedicated accountant?
• What kinds of special ecommerce accounting considerations should I be aware of when keeping the books?
• Are we making any accounting mistakes with our ecommerce business? And, if so, what are the implications of those errors?
• How is our tax burden being affected by selling online?
• What kind of ecommerce financial tools are essential to implement?

Understanding how ecommerce financial operations differ aids in determining whether you need an ecommerce accountant. However, even with that knowledge, an ecommerce accountant’s value will vary based on an individual business’s needs and existing skillsets.

So, do you need an accountant with ecommerce experience? Find out now in our guide to hiring an ecommerce accountant:

Relevant Experience
Like any other industry, vertical, or growth stage, having an accountant with ecommerce experience is always going to be a benefit to a company that is selling online.

In the same way that professional services firm, manufacturer, SaaS company, or clothing retailer would want an accountant who is used to the specifics of their industry, an ecommerce company can benefit greatly from hiring an accountant with ecommerce experience. At the core of it, bringing on personnel that understands what you sell, where you sell it, and to whom you sell it is always beneficial.

Online selling has considerable differences to account for that can affect financial reporting, namely activities such as:

• Applying sales tax
• Categorizing chargebacks
• Calculating cost of goods sold (COGS)
• Managing inventory
• Recording shipping costs
• Handling international sales and foreign currency

These ecommerce-specific issues can affect everything from cash flow to financial statements to stakeholder reporting, making them key pieces of running an ecommerce operation. An accountant with ecommerce experience is going to have a strong grasp of best practices related to these types of activities.

Ecommerce Accounting Options
As the adage goes, “If you’re asking if you need it, you probably need it!”
Owners with less financial acumen are more likely to need an experienced accountant to lean on, regardless of the accountant’s background. And when the details related to selling get more complicated, this becomes even more crucial.

So, if you are worried that you may need an ecommerce accountant, chances are you have already experienced instances where you would have benefitted from having an accountant on staff with this kind of expertise, or you are anticipating that need arising soon. Whether you are already behind the ball, or trying to stay ahead of it, it is never too early to start looking for an accountant that meets your criteria.

Once you have identified the need for a specialized accountant, now is the time to start evaluating your options. Obviously, hiring a dedicated, top-tier accounting leader is going to be the best route to take, but what if you cannot find what you are looking for or what if your budget will not allow it?

Your options include:

1. Utilizing ecommerce accounting software such as QuickBooks or Xero
2. Outsourcing to a third-party accounting company that specializes in ecommerce
3. Hiring an in-house ecommerce accountant

If there is significant financial experience currently in the company and bandwidth among business leadership, an accounting platform may provide enough assistance to keep the books correctly. Otherwise, an in-house or outsourced hire will be necessary to oversee the company’s accounting activities.

Obviously, outsourcing your accounting needs is going to be more cost-effective than hiring someone in-house. But will you have to sacrifice on responsiveness and ease of communication? Not if the provider you choose is a good fit. The right third-party partner will pair you with the accountant or accounting team to fit your specific needs with your desired level and style of communication.

When you need an ecommerce accountant, look no further! Our experienced team of accounting professionals has the depth and breadth of experience required to keep your organization moving forward and growing. Contact us now to find out how we can help!