According to Accenture, U.S. shoppers plan to increase their holiday spending by 11 percent for the upcoming holiday season. Meanwhile, shoppers will remain focused on the bottom line and on scoring deals. If you maintain an online store, you may be wondering whether you need to organize your sales data using some type of accounting software or if you can keep track of data yourself. With online shopping forecast to grow, make the investment now in a good software solution, so you can learn to use it and automate reporting when you are pressed for time later.
Pros and Cons of Using Accounting Tools
For many e-tailers, the best way to track sales is through sales receipts, which both record the amount paid by the user and the amount of the sale. If you sell a lot of products, manually keeping track of sales receipts can be time consuming and challenging. If you experience hardware failure or you lose printed copies of the receipts, you may not be able to recreate your sales records. This can cost you when tax-time arrives.
Accounting software allows you to track employees, customers and inventory in one system. This can be very valuable for busy times of year, as you can better target repeat customers and ensure that you don’t run out of a popular item, as PC Mag explains. The software also allows you to run reports, generate sales figures, view at a glance which items are unpopular or unprofitable, and generate insights that can improve your business model, according to Inc.
Some e-tailers may shy away from accounting tools because they think the tools are difficult to use or require specialized skills. While some software certainly does, there are plenty of programs available for small business owners without an accounting background.
If you have a niche business — for example, if you make and sell hand-carved clocks — you may sell only a few items for a high price. In this case, you may not need accounting software because overall sales are low. However, it is a good investment for the average e-tailer.
What to Look for in E-commerce Accounting
A cloud-based solution may be ideal for e-commerce owners who use the cloud to manage and store business assets, and many companies, including Intuit, offer cloud-based versions of their software that can be perfect for e-commerce shop owners. Other owners may prefer dedicated small business software, which can offer greater explanation and guidance to those who may not have accounting skills. In addition, there are lots of desktop-based solutions for PC and Mac owners alike.
Most e-commerce store owners can use generalized accounting software, which is often cheaper than specialized industry software. Before investing in any program, think about what sort of information you need to keep (say, for tax time) and what sort of information you need to make business decisions. Then look for a piece of software that allows you to handle those tasks. If you think you’ll be hiring one to two employees, you may need a solution that offers payroll services. If you’re a one-person shop, you will not need to pay extra for a program that allows you to make a payroll. Then comparison shop to get the best deal for your budget.
Author: Chris London is the art director for www.PixelProductionsInc.com, a premium web design partner for BigCommerce, the World’s largest and fastest growing eCommerce platform.
