Despite advanced accounting software, many industries keep to the old and time-consuming manual process. There’s an over-reliance on spreadsheets, which can be time-consuming to manually record and input. Should personnel make any changes, approvals take forever, affecting business efficiency. Add to that also the inevitable human error that can send the entire accounting team into limbo, with even the slightest mistake affecting the accuracy and effectiveness of the financial statements.
However, with today’s technology, your e-commerce business can automate your accounting process with software like Sage eCommerce. If you’re keen on automating your e-commerce business’s accounting processes, you’ve come to the right place. Here are some tips you can follow to transition to automate your accounting:
Automate The Accounts Payable Process
One main difference that sets small businesses apart from bigger ones, even in the e-commerce industry, concerns invoice management. There are still so many e-commerce businesses using a manual invoice management system. This means that they send and record accounts payable demands for payment manually.
However, the manual approach to handling accounts payable might seem easy on paper, but it’s not efficient. Paper invoices can sit as long as weeks, even months, on desks, without any movement. The worst scenario happens when some of those paper invoices may get lost.
With automation, your e-commerce business can record and acknowledge accounts payable transactions immediately. That way, you can make the most of early payment discounts from the suppliers you need to pay. Moreover, you can also take notes of any problems that could potentially arise immediately, allowing accountants to address those in the earliest time possible.
Select A Workflow Template
With the right accounting software, you’ll also have a workflow template to use at your disposal. A template can make it easier for your e-commerce business when all you have to do is modify premade templates readily available to you. With that, your accounting team can have a more solid foundation as they start and keep consistency in formatting and other critical areas they’ll need to report.
Once your accounting can accustom themselves to the automated system, you can proceed with customizing your pre-built expense report. When you personalize those forms, you can refine them to your business’s reporting needs. That way, your team can do everything in the correct order.
Apply An Online Invoice Tracking
Given that you’re running an e-commerce business, it also follows that you should be able to adopt an online invoice tracking system. This tool is an excellent addition to help your business receive quick payments and track your invoices. In addition, when you receive and send payments faster, your accounting team can send timely accounting records more efficiently.
One excellent example is enabling online payment options on your e-commerce site through debit or credit cards. In addition, you can link this type of invoice system with instant payment methods and instant billing. This payment option ensures a smooth invoicing process is within your and your customer’s reach
Ensure Consistent Accounting Process
No matter how advanced a particular accounting software can be, it still can’t work to its best when competing with your e-commerce business’s other software. You must avoid having too much different software, which may only confuse your accounting team. Instead, stick to a better and tried-and-tested approach. You ensure that your organization applies and implements a consistent accounting process.
Automate Month-End Reporting
The busiest days in the month for the accounting team are those last seven to ten days. This is when the entire team is in a crunch period to make it on time with all the month-end reports. These include closing the general ledgers, coming up with financial statements, adjusting any allowance accounts, and reconciling cash accounts, among many others.
Because your team completes this process periodically and routinely, it’s imperative to do this as seamlessly and error-free as possible. The easiest way to achieve smooth month-end reporting is to automate each of those steps. Don’t neglect them in favor of the other more time-consuming accounting-related tasks you must accomplish daily.
Automating even the simplest tasks in accounting can lead your e-commerce business to the positive effects of reaping huge returns. It’s a significant change, but it’s worth making. There are various areas of accounting automation you can apply to your e-commerce business, but those above are good starting points. Whatever changes you have in place, keep your team within the loop. By doing so, your new accounting software can help improve your e-commerce business and its operations.