As you set up your Shopify store, there are several aspects that you need to consider. First, you have to find a way to make your online business successful, and then you must understand how to properly do bookkeeping for Shopify. Learning how to calculate your business expenses and revenue will help you evaluate whether you are making profits or losses. In this article, we will talk about how you can begin effectively accounting for your Shopify store.
What Is Shopify?
Shopify is one of the largest e-commerce platforms in the world today, and is designed to help businesses make their products available online. With this platform, you can launch your online store without worrying about developing and managing your own website. Shopify has proven to be an effective e-commerce platform that has enabled millions of merchants to make huge profits.
According to 2016 Q1 data, the average income of a Shopify owner in the United States is about $3,897 per month. Therefore, if you have the right product and a good business strategy, you stand a chance to make a solid profit with your Shopify store.
How to Bookkeep For Your Shopify Store
As you run your Shopify store, you need to continuously record and manage all your financial transactions, including sales, expenses, and payments, commonly referred to as bookkeeping or accounting. Bookkeeping helps you track all your expenses and earnings so that you can make informed financial decisions–but how do you do bookkeeping for your Shopify store when you aren’t a professional accountant? Many Shopify merchants face this dilemma.
Thankfully, Shopify allows you to incorporate a third-party accounting program that will simplify your bookkeeping tasks. With a reliable Shopify accounting app like Synder, you can easily collect and compile all your financial data so that you evaluate how your business is doing financially. Here are the main functions of this accounting program:
Maintaining and Updating Financial Data
Bookkeeping for your Shopify store involves basic calculation and accounting, and the numbers you deal with depend on your type of business. You’ll also be expected to settle accounts receivable and bank statements, record all financial transactions, prepare invoices, bill clients, and track payrolls. With an accounting app, you can perform these tasks quickly and accurately.
Keeping Track of All Transactions
Bookkeeping is known to be time-consuming because you have to check and record each financial transaction. It also involves balancing your financial books at the end of every day and tracking payments that come in and go out of your business. Therefore, you need a reliable accounting program that simplifies these tasks for you, allowing you to track all transactions and balance your books efficiently and accurately.
Streamlining Financial Data Entry
With bookkeeping software, you’ll streamline your bookkeeping processes and create detailed financial reports for auditing purposes. It also allows you to consolidate your financial data and automate records for each purchase whenever you need to review your financial records. Using an accounting program is a simple way to improve the accuracy and scalability of your Shopify store, while reducing time wasted on repetitive tasks.
Lastly, it is important to track your store’s financial data in order to gain sufficient insight into how well your business is doing and how you can plan for optimized business expenditures moving forward.