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Why Is Accounting For Ecommerce So Difficult?

Accounting for e-commerce can be difficult, time consuming, and quite frankly overwhelming without the proper tools, knowledge, and support needed for success.

Brody Hall
By Brody Hall
Joel Taylor
Edited by Joel Taylor

Updated February 10, 2023.

Ecommerce accounting is the process of tracking and recording transactions from online storefronts for multiple reasons, such as managing inventory and preparing your taxes. However, this process can be challenging without the necessary knowledge and skills. Read on to learn more.

Common Reasons Ecommerce Accounting Is Difficult

  • Data reporting Not only is data reporting difficult if you don't understand the necessary mechanisms, but it is also time-consuming.
  • Inventory accounting and management Inventory accounting can be complex or simple depending on your cost valuation approach. This is essential to your bottom line and depends on the nature of the products you sell.
  • Sales tax Tracking sales and sales tax is critical to avoid penalties, but this can be extremely complicated without a dedicated financial team—something wholly unexpected for the average ecommerce small business owner.

Conclusion: Make Ecommerce Accounting Easier With Automation

There are various types of accounting software capable of fully automating your accounting processes to reduce data entry errors and provide actionable insights. Choosing accounting software that will grow with your ecommerce business while offering full integration will allow for real-time data reporting, providing you with the information required to make informed decisions regarding inventory and expenses.