Online shopping has emerged as a mega-industry for businesses. It is owing to the reason that people want to optimize their time while making a purchase online. It has given rise to the eCommerce business in the world, including the United Arab Emirates.
There is no denying that every business has a close connection with accounting because of financial management. Similarly, the people running online businesses in the UAE and other parts of the world look for optimal accounting services for comprehensive bookkeeping.
Are you running an eStore and confused whether outsource accounting operations or manage it individually? The article will help you get the answer to all your question and solutions for your confusion. Keep reading!
Why is eCommerce accounting different?
Before moving towards the real problem of hiring accountants for online stores, you must understand the difference between managing accounts for conventional businesses and eCommerce. The significant difference in the patterns of revenue generation.
It is because eCommerce generates sales over the internet and uses different methods for revenue collection. The people dealing with online buying and selling rely heavily on diverse payment channels.
Therefore, the business people need to optimize their accounting system for keeping the financial record of each and everything, including the scattered inventory. For this purpose, it is essential to decide on outsourcing accounting activities.
Top reasons for outsourcing eCommerce accounting
Nevertheless, the evolution of the eCommerce industry has increased the need for comprehensive management of finances in the business. It is because you have to keep a check on the online transactions besides cash on delivery payments. All this can be tricky if you don’t consider professional accountants and bookkeepers.
Let’s consider the primary reasons that can help you decide between hiring professional accountancy services for your online business:
Quick inventory checks
First, accounting doesn’t revolve around revenues only, but it is equally important to check on the inventory systems. It is because you need to manage inventory for executing the business operations smoothly.
Only a professional accountant can help eCommerce businesses in dealing with inventory complexities. So, suppose you want to mitigate the risks associated with inventory management. In that case, it is suggested to hire the best accounting firms in Dubai as professionals stabilize the cash flow for selling and purchasing.
Hustle-free transactions recordkeeping
The eCommerce owners have to keep a check on the transactions for maintaining financial transparency. It is the biggest challenge for business owners because there is no defined period for payment receivables and payables.
In such a situation, you may mess up all the financial transactions ending up with no proper record of profit and expenses. However, you can eliminate the risks of mismanagement by acquiring professional accountancy services.
Effective management of cash flow channels
As already said, financials are scattered in the eCommerce business. It is not similar to the brick and mortar stores because there is no physical point of sale or cash counters. Instead, online businesses rely heavily on shopping carts, online valets, and other such payment methods.
Therefore, business owners must keep a check on all the channels for improved cash flow management. If you were running an online business and worried about cash flow channels management, get help from accounting professionals, and forget the stress.
Compliance with tax liabilities
Every business needs to comply with taxation rules and regulations. There is no exception for eCommerce businesses. It is a nightmare for many people because VAT is applied to eCommerce companies.
Are you running a business in UAE with a digital presence for selling and buying? Don’t forget to maintain business accounts comprehensively to stay away from penalties and inconvenience.
Also check out: Institutional Finance
Amazon regulation compliance
Besides the state taxation system, Amazon maintains a proper system of tax compliance for eCommerce sellers. Therefore, the business owners who are buying and selling their products using Amazon need to successfully ensure “Fulfill by Amazon (FBA)” to get through legal nexus successfully. According to FBA, eCommerce businesses have to pay the fee on three segments or parts including:
- 6-20% sales commission depending on the business nature and category
- FBA FEES based on business type, category, and other parameters
- Cost for advertising such as sponsored items, add banners, etc.
It requires effective record keeping under the supervision of industry-driven professionals. So, you can hire the best accounting firms in Dubai to avoid confusion in regulatory compliance.
Beat all challenges in eCommerce with professional accountants!
Summing up, eCommerce has emerged as a significant player in the business market. It is increased the competition among the businesses to generate higher revenue. Similarly, it has augmented the complexities of managing financials. Many business people are facing severe challenges of effective accounts management for bookkeeping and VAT compliance.
However, you can face the challenges of recordkeeping by getting professional accounting services in time. Your business success needs to keep a check on the finances.