Thousands of entrepreneurs have built thriving businesses on eBay. Whether you’re just getting started as an eBay seller or you’ve been working in the eCommerce space for years, you need to make sure that your accounting practices are providing value to your business. Accounting often feels like an afterthought, especially if you believe that your business is doing well. But the reality is that you cannot know all of the most important KPIs and sales metrics unless you’re accurately tracking your costs. This is why you need to invest in eBay accounting software ASAP.
But if you’ve never tried out accounting or bookkeeping software for eBay sellers before, you probably have a ton of questions. For example, how accurate is data that has been integrated from eBay into third-party accounting software? What is the most efficient way to manage eBay integration? Finally, what is the best accounting software for eBay online sellers?
In today’s guide, we will answer all of these questions and more, but first, let’s look at what eBay accounting software is and how it works:
Accounting software for a brick-and-mortar business is a lot different than accounting software for an eCommerce business. Even accounting software used for different eCommerce channels will need to be able to handle different data flows, fee structures, and configurations. For this reason, you need to find a tool that is specifically designed to handle data integrated from eBay. Here are some of the key characteristics that make accounting software beneficial to eBay sellers:
As an eBay seller, you know that the platform is unique from most other selling channels, insofar as sellers have the option to auction different products. Though most eBay businesses prefer a fixed price model, it is still important to have accounting software that can manage data from either auctions or traditional sales.
Moreover, eBay has unique fee structures when compared to channels like Amazon or Walmart. If accounting software is configured to integrate data from one of these other channels, it may display expenses, fees, shipping costs, and profits from eBay inaccurately. Therefore, it is vitally important to make sure that your accounting software can properly categorize data integrated from eBay without the need for manual revisions.
Maintaining a balanced inventory is vital to any eBay business. Not only do you need to know how many products you have in stock, but you also need to use sales data to make informed purchase orders. Otherwise, you could end up understocked on popular products or overstocked on products that don’t sell as often.
A lot of accounting software does the bare minimum when it comes to inventory tracking, and this can be a barrier to proper inventory management. The best accounting software for eBay sellers will integrate inventory data from eBay, alert you when inventory is running low, and offer projections for future purchase orders.
Sales analytics reports are the lifeblood of an eCommerce business. But it’s not enough just knowing how many sales you made over a given period. You also need to consider metrics like COGS, landed cost, shipping expenses, and perhaps most importantly, profit margins. All of these metrics are intertwined, so even if you lack one of them for a given product, you’ll have a difficult time calculating everything else accurately. Good accounting software will automate these reports and display the information in a way that is easy to digest and analyze.
For example, let’s say that you sell shoes in your eBay store. Each shoe has different expenses related to manufacturing and eBay fees. Similarly, your shipping costs will vary based on the location of the buyer. Without a simple and effective way to organize these unique metrics, you’ll be unable to know whether you’re actually turning a profit with each sale. Thankfully, high-quality accounting software can organize these metrics and help you understand exactly how well your business is doing.
eBay supports transactions in more than 200 countries, so even if you’re target demographic resides in the United States, there’s a good chance that you will still make foreign sales from time to time. This is why multi-currency support is so important for eBay accounting. If your software calculates everything in U.S. dollars or does not have the capacity to provide accurate, up-to-date currency conversions, your sales data could be completely inaccurate.
Every eBay seller may have unique preferences when it comes to accounting software, but certain providers like QuickBooks and Xero stand out as some of the best for eBay accounting software. Let’s take a closer look at each to see what they offer to eBay sellers:
QuickBooks is one of the most popular bookkeeping and accounting software providers in the world. With QuickBooks, you can sync transaction data from eBay with very little manual data entry required. Additionally, you get a lot of useful reports with QuickBooks, providing data related to revenue, taxes, and fees paid to eBay. Finally, QuickBooks is pretty easy to use, even if you’re pretty new to bookkeeping. In fact, you can generate reports to analyze the health of your business with just one click.
Xero may not have as much name recognition as QuickBooks, but it still offers some of the best accounting software for eBay sellers. Like QuickBooks, Xero allows you to automatically sync important data directly from your eBay store. You can also customize exactly what you want to integrate, including sales, fees, shipping costs, and taxes. Xero also makes it easy to view relevant data for different products and even individual customers. Lastly, Xero goes the extra mile by allowing you to quickly generate invoices, review your cash flow, and manage your expenses.
As you can see, both QuickBooks and Xero are great options when it comes to eBay accounting. They both offer a lot of the essential tools you need to manage your eCommerce finances, without having to do a lot of manual data entry. But do you want to take your eBay accounting to the next level? If so, ConnectBooks is the answer.
ConnectBooks is a third-party application that works seamlessly with both QuickBooks and Xero. It also ensures that you can integrate data between eBay and either piece of software with 100% accuracy. No more manual data entry means having complete confidence in your analytics.
And the benefits don’t stop there. ConnectBooks goes above and beyond standard accounting software with dozens of useful reports. Want to know the landed cost of each product you sell? ConnectBooks can give you that information in seconds. Or perhaps you want to analyze eBay’s data against other sales channels? Once again, ConnectBooks makes it happen with ease. Oh, and multi-currency support? ConnectBooks has you covered for that, too.
Don’t waste your time trying to manage your expenses, profits, KPIs, inventory, and other vital metrics in an Excel spreadsheet. Instead, invest in QuickBooks or Xero and use ConnectBooks to bring all of your most important data together in place. It’s fast, easy, affordable, and 100% accurate.
Do you want to learn more about the best accounting software for eBay sellers? If so, reach out to the experts at ConnectBooks today!