5 TIPS to have Smooth Shopify Accounting
Benefits of Shopify Store over other sales channels
The complexity of Shopify vs other sales channel’s accounting
Things to watch out for to avoid problems in Shopify accounting
Shopify offers a lot of benefits for sellers who want to engage online.
Low start up costs – you can get a free online store or a cheap monthly subscription
Multi-channel support – Shopify allows you to sell your products on other marketplaces such as social media, retail, and other online sales channels.
A good number of integrations – Shopify can integrate with Pinterest, Facebook, Messenger, etc. to provide better experience with customers.
A lot of customization options – using themes and messaging, or your own designs.
A good number of payment options, Shop Pay, Shopify Installments, Stripe, Klarna, PayPal, etc.
Being a great sales channel has attracted a lot of sellers to use Shopify to sell their products.
But, even a great platform has a lot of challenges, such as order management, inventory management,
bringing traffic to your store, different shipping speeds, multiple sales channels demand, and multi-currency accounting challenges, etc.
So in terms of acounting and bookkeeping for a Shopify store, what do you think are the best practices and tips to help you have a smooth experience?
There is no one solution that will solve them all, but we want to help you avoid mistakes, headaches, and a messed up books for your Shopify Store.
5 TIPS to Have Smooth Shopify Store Accounting:
1. Choose the best accounting software
Look no further – we always recommend you use QuickBooks Online and A2X for your Shopify store accounting
2. Do not use PayPal multi-currency or do not use anything PayPal
Trust me, PayPal can give you a lot of options to pay for your customers, but in terms of accounting – it can be a hot mess! If you enabled multiple currencies it will get really troublesome. It takes a lot of time to properly trace, record, and reconcile multiple currency PayPal accounts.
3. Get yourself fully familiar with your payment methods
Each payment method usually have their own fees deducted before sending your payouts to your bank account – don’t forget to account for that as well
4. Reconcile your QuickBooks Online records to Shopify Reports
Sales review and reconciliation – one of the core controls you need to do to verify that QuickBooks Online records matches your Shopify Sales, Fees, Deductions, etc.
5. Use A2X to calculate COGS and always reconcile your Inventory balances
If you want to use Shopify to calculate your COGS, and monitor your inventory levels – you need to keep it super updated. Which is usually not the case. So it’s better to get your COGS in another more reliable way such as using A2X and SKU Masterlist.
It’s a good practice to keep your purchase invoices intact so you can make sure you never miss to account for your inventory purchases, this is essential to keep track of your inventory properly.
Do a monthly inventory count and check if it reconciles with QuickBooks – if not, verify and adjust.
And that’s it! Should you have questions or suggestions, please let us know in the comments.
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