Bookkeeping can be a headache for any eCommerce business, but it is particularly challenging for eBay sellers. Like many other selling channels, eBay doesn’t always organize the information you need in helpful ways. This can make it difficult to know what taxes you owe, which types of products need to be restocked, or even how much you’re earning from one month to the next. Naturally, without quality accounting software for eBay sellers, you may feel completely lost.
So, what are some examples of popular eBay bookkeeping software? Is there a fast and easy way to connect eBay to QuickBooks? Finally, how you can handle all of your eBay bookkeeping needs in one place?
In today’s guide, we will answer all of these questions and more, but first, let’s look at how bookkeeping on eBay is unique from other channels:
If you are an eBay reseller, you already know how different it is from running a regular brick and mortar store. The online marketplace is fast-paced, unpredictable, and constantly evolving — and eBay is no exception. While it may seem like a daunting task at first, keeping track of your financial records is crucial to ensuring the success of your online business. From managing multiple sources of income to navigating complicated tax laws, eBay resellers need to stay on top of their bookkeeping game to ensure success in their business.
For anyone selling on eBay, understanding the rules is a must. With over 185 million active buyers, eBay has made it easier for small businesses to reach a wider audience. However, to take advantage of this huge pool of potential customers, you’ll need to meet certain requirements.
First and foremost, sellers must abide by eBay's policies, including rules on prohibited items and pricing. Additionally, eBay sellers need to stay up-to-date with changes in eBay's guidelines. This includes understanding the various fees associated with selling on eBay, such as listing fees and final value fees. Navigating eBay’s fees can be challenging, but with the right approach, you can pay these fees and accurately record the payments. This means that eBay’s unique internal policies will have a direct impact on how you manage your books.
Organizing sales records as an eBay reseller is no easy feat. With hundreds, if not thousands, of transactions happening each month, keeping track of them all can be a daunting task. However, it is essential to stay on top of your sales records to ensure accurate bookkeeping and tax reporting. One of the first things you should do is set up a coherent system.
This can be as simple as creating an Excel spreadsheet or using a more sophisticated bookkeeping software like QuickBooks or Xero (more on that later). Whatever system you choose, make sure it is easy to use and allows you to categorize your transactions in a way that makes sense for your business. Ideally, your system for recording sales should be automated. Though eBay offers a tool to export your sales data into a spreadsheet, this not the most efficient option.
As an eBay reseller, tax season can be one of the most stressful times of the year. With so many sales, purchases, and transactions to keep track of, it can be difficult to know where to start. Fortunately, with a little bit of planning and preparation, you can navigate tax season like a pro.
Above all else, you’ll need to accurately track every sale, purchase, and expense using a dedicated bookkeeping system. Regardless of which system you use, you’ll need to make sure you are consistent and organized. This will not only make tax season a breeze, but it will also give you a clear understanding of your business's financial health.
Remember to take advantage of deductions and credits available to eBay resellers. Did you know you may be able to deduct the cost of selling fees, shipping supplies, and even the use of your home as a workspace? Keep detailed records of these expenses to maximize your deductions and lower your taxable income.
With traditional inventory, it’s pretty simple — you look at what you have, and you determine how much more you need. You can also have greater confidence when buying new inventory by comparing your sales reports to the stock in front of you. Which products are selling the fastest? How long can I wait before we’ve run out of our most popular products? Will I risk a shortage if I delay the order?
With comprehensive sales data and physical inventory, you can answer these questions pretty easily. As an eBay seller, things aren’t quite as easy. Even if you’re just selling through eBay and no other channels, you’ll need to keep track of all your inventory, at all times. This means knowing how much you have, how much is currently in transit, how much is in the process of being returned or replaced, and so on.
eBay does offer in-house tools to track items by SKU and even auto-order new inventory when supplies are low. However, eBay’s system does not do as well when there are road bumps in an otherwise smooth process. For example, if a product is damaged in transit or a customer wants to request a refund, it can be very difficult to track these items using eBay alone.
There have been a lot of different ways to manage eBay bookkeeping over the years. In the past, GoDaddy Bookkeeping was one of the most popular tools among eBay resellers, but it has been discontinued. Today, most eBay sellers rely on traditional spreadsheets, QuickBooks, or Xero.
While traditional Excel spreadsheets and even physical spreadsheets are still used by eBay sellers, they are not the best option. Filling out bookkeeping spreadsheets by hand is extremely time-consuming. Plus, the risk of committing errors if far greater when you’re having to do all of the calculations and notations yourself.
And compared to automated bookkeeping software, spreadsheets are extremely limited in what they can do. Unless you happen to be well-versed in some of the more advanced spreadsheet functions, you probably won’t get the kind of insights and analysis you need. Lastly, if you plan to scale your business at some point, you’ll almost certainly find that traditional spreadsheets cannot keep up.
QuickBooks is by far the most popular bookkeeping software for sellers on all eCommerce channels, including eBay. Here are some of the benefits of using QuickBooks for eBay sellers:
Xero is another popular bookkeeping software that can be extremely beneficial to eBay sellers. Here are just some of the benefits of using Xero:
If you’ve already thrown out the spreadsheets and upgraded to quality software like QuickBooks or Xero, you’re on the right track. But if you sell on multiple channels, you require comprehensive Xero or QuickBooks eBay integration, or you need more thorough financial reports, you should consider adding ConnectBooks to your arsenal of business tools. ConnectBooks can automatically sync data from eBay and other channels, keep track of inventory, and generate useful reports, including P&L reports and cash flow statements.
ConnectBooks is undoubtedly the best accounting software for streamlining your financial operations. From keeping track of your sales and expenses to generating reports, this software has got you covered. Its integration with eBay is seamless, helping you save time and effort while ensuring accuracy in your records. The robust features it offers, combined with its user-friendly interface, make it an ideal choice for eBay sellers of all sizes. With ConnectBooks, you can simplify your accounting process and focus on growing your business.
Are you in need of comprehensive solutions for eBay sellers? Do you want to learn more about managing all of your eCommerce channels in one place? If so, reach out to the experts at ConnectBooks for more information!
