Singapore
  • Hong Kong
  • UK
  1. Osome Blog Singapore
  2. E-commerce Store Bookkeeping Tips

E-commerce Store Bookkeeping Tips

As a business owner, understanding and keeping tabs on your business finances is imperative to allow your business to flourish. This is why bookkeeping is so important for any business.

If you’re still learning the ropes, the good news is that it is possible to manage the books on your own. Alternatively, if you prefer to have more time to focus on your core business, consider outsourcing your bookkeeping to us! At Osome, we take care of your daily bookkeeping and automate simple routine tasks to save on expensive labour.

Meanwhile, this is what you should know about managing your e-commerce store’s books.

What Is Bookkeeping?

Bookkeeping involves the recording and managing of all financial transactions incurred by your business, from sales, purchases to payments. Your bookkeeping process should include tracking all income and costs, so you can make an informed financial decision.

In a nutshell, bookkeeping allows you to see your business finances at a glance, so you can balance your accounts and improve business cash flow.

  1. Make It a Daily Habit To Reconcile Your Receipts

It can be a nightmare when your receipts pile up, and you’d find yourself having difficulty sorting them out. Instead, make it a point to reconcile your receipts on a daily basis.

Keep good records by leaving a thorough paper trail for all your business transactions. This means that you should keep the receipts from your midday coffee sessions with your investor, or download the email receipt for your latest digital ad buy.

When it comes to tax season, you'd be glad you kept up with these records. This is because you will have to be able to support your claims in order to reap the full tax benefit of claiming legal business expenses.

Tips

  • Set up specific folders for invoices and receipts, and sort them out every day
  • Create a simple rule in your email inbox to direct your emails from specific senders (such as digital ads, suppliers etc) to a folder named "Invoices and Receipts"

  1. Focus on 2 Key Aspects Every Week

If you're doing things right, bookkeeping shouldn't take up too much of your time. On a weekly basis, pay attention to 2 important things - your variable expenses and cash flow.

Tracking variable expenses

Although reviewing your variable expenses can be done on a monthly basis, we would recommend that you keep tabs on this every week instead.

As an e-commerce business, some of your allocated budgets in areas like marketing could be affected by seasonality. For example, when it comes to competitive sale periods like Black Friday, Cyber Monday or occasions like Christmas, this is when the competition toughens and will inevitably affect the cost of your marketing dollars spent on digital ad buys.

As such, you should keep a close watch on expenses like your marketing budget to ensure you are comfortable with the fluctuation, and carry out immediate measures before the end of the month if necessary and consider new initiatives.

Managing cash flow

Do you have enough funds in your business bank account? How much do you have at the moment and what can that amount of money cover? When it comes to cash flow, these are some of the things you should keep in mind.

Some business owners may have the misconception that having a revenue of $X amount means you have that amount of cash just waiting in your bank account, but your cash flow also involves daily decisions on items to purchase and other business expenses. Therefore, it is crucial that you have a good understanding of your cash flow to allow yourself to make better financial decisions.

  1. Carry out a Monthly Review

Even when you’re practising daily and weekly bookkeeping, you should also take some time out once a month to keep your books in order. Here’s how you can go about doing a monthly review:

Review your expenses

For an entrepreneur, making business decisions can be stressful. Use your monthly review to think about your business decisions over the past month, and how you can make use of these expenses in a more strategic manner moving forward. Review how you can optimise cash flow over profits to ensure the smooth day-to-day operation of your business.

Get a snapshot of your business finances

Every month, you should look at your business's health as a whole, to understand the bigger picture and how things are going for your company.

Ensure you have recorded all your expenses and delve into your expenses, income, sales and cash position to ponder over how you will make financial decisions from the next month onwards. If you are handling any new campaigns or projections, you may also wish to look into those numbers to determine if they are affecting your expenses, sales, or both.

Remain organised

If you are doing bookkeeping all by yourself, you will have to be more organised than ever. Make it a point to sieve through all your email receipts and organise them into expense categories in preparation for tax season. This also allows you to have a better understanding of the amount of money you are spending on advertising and your inventory orders.

Make adjustments where necessary

No two businesses have the same business model, and what works better for another business may not work as well for you. This is why it is crucial to do a monthly review, so you can evaluate if your revenue and expenses may require a different set of bookkeeping needs. For example, if your business only requires the overall monthly sales, consider if it is even necessary to log and track every single order that you receive. Perhaps for your case, it may be easier to streamline things and look at the monthly sale figures instead.

Free Yourself From the Admin Work and Grow Your Business

If you prefer to relieve yourself of the accounting work for your e-commerce business, fret not for we are here to help.

We connect directly to all your marketplaces and upload financial statements from there. We then transform them into books, reports, and tax filings. Simply leave the administrative work to us to take the routine off your workload, so you can focus on more important tasks.

Share this post:

Tips to run your business smarter.
Delivered to you monthly.

You'll receive a verification email you'll have to open and confirm the subscription.

You might like it

Government Grant

Wage Support & Rental Relief for Businesses in Singapore’s Stabilisation Phase

Tighter COVID-19 restrictions will be implemented from 27 September to 21 November 2021. Find out what support SG companies can receive from this Stabilisation Phase.

E-commerce

A Design Guide for E-commerce Websites

If you’re looking to improve your e-commerce page and improve sales, you might want to learn the fundamentals of how to design a good website.

Entrepreneur's Bootcamp

Best Practice Invoicing Tips for SMEs

This article will help Singapore-based SMEs get to grips with the best invoicing practices. Take a look at the tips and how-tos to guide you toward being more streamlined and savvy.

E-commerce

Which Is The Better Payment Gateway: Paypal or Stripe?

As an e-commerce business owner, you would have heard of payment gateways PayPal and Stripe. With these two big platforms being the most popular online payment gateways, you may face a dilemma when it comes to deciding which payment gateway to use.

E-commerce

Tips For Amazon Sellers To Manage Your Inventory Better

Brand owners and sellers of all scales struggle to seek a well-balanced supply chain. Additionally, Amazon has its own inventory management rules, which makes everything even tougher.

E-commerce

Top 10 Best E-commerce Hosting Services in 2021

When you are setting up your e-commerce shop, the right hosting provider can make all the difference. However, with a variety of options out there, choosing the best one can be confusing.

E-commerce

What You Need To Include In An Invoice for E-commerce

For business owners who own and run an online store, you probably already know that invoices must be sent to your customers for the services you provide or the goods you sell, as a form of purchase proof.

E-commerce

Guide to E-commerce Fulfillment & Shipping for Singapore E-commerce Sellers

E-commerce fulfilment and shipping for your Singapore-based business matters. This guide unpacks how the right strategy can influence your bottom line and help you find what’ll work best for you - whether it’s in-house fulfilment, dropshipping or a solid partnership with a 3PL.

E-commerce

E-commerce Tips: How To Use Packaging Inserts to Increase Revenue

Improving customer retention is one of the effective ways to create brand awareness. Additionally, placing your focus on existing customers also means that you do not have to splurge extra dollars on marketing.

Entrepreneur's Bootcamp

The Cost of Living as a Foreign Business Owner in Singapore

When choosing Singapore as a base to run your business is the cost of living, you need to consider the cost of living.

E-commerce

5 Most Lucrative E-Commerce Niches In 2021

If you’re just starting or looking to go in a new direction, finding a lucrative niche will make every part of running your e-commerce business easier. This article will look at the trending e-commerce niches to consider.

Entrepreneur's Bootcamp

How To Pick the Right Company Name

Choosing a business name is not that simple, and you may wreck your brains over choosing one, only to find out that ACRA did not approve its registration.

Tips to run your business smarter. Delivered to you monthly.

You'll receive a verification email you'll have to open and confirm the subscription.

We’re using cookies! What does it mean?