Accounting for TikTok Shop Sales on Shopify with A2X Integration

Accounting for TikTok Shop Sales on Shopify with A2X Integration

As a Shopify merchant, you’ve got the flexibility to sell across multiple channels, including TikTok Shop. This means you can funnel all your orders through Shopify, keeping everything from orders, inventory, and promotions in one place. But, it’s not without its complications, especially when it comes to accounting. In this blog, we’ll dive into selling on TikTok Shop, the accounting headaches it might bring, and how A2X helps you reconcile those tricky payouts in QuickBooks Online or Xero.

The Rise of TikTok Shop in Ecommerce:

TikTok isn’t just a video-based social platform – it’s becoming a major player in ecommerce, thanks to the launch of TikTok Shop. Blending entertainment with shopping, TikTok Shop targets its massive user base with an interactive shopping experience right within the app.

Key Features of TikTok Shop:

  • In-Feed Video and LIVE Shopping: Users can shop for products directly from videos and live streams in their ‘For You’ feed, making the shopping experience interactive and immediate.

  • Product Showcase: Brands can display products on their profile pages, allowing users to browse, read reviews, and purchase directly within the app.

  • Shop Tab: This feature acts as a marketplace where businesses can showcase their products, and users can discover and purchase items without leaving the platform.

  • Affiliate Program: TikTok Shop offers a commission-based affiliate program, connecting creators with sellers. This allows creators to monetize their content by promoting products in their videos and live streams.

  • Shop Ads: These new ad formats enable sellers to promote their TikTok Shops more effectively within the app, enhancing product discovery and purchase.

  • Fulfilled by TikTok: A logistics solution where TikTok handles storage, packing, and shipping of products, allowing merchants to focus on their product quality and marketing.

  • Secure Checkout: Transactions are facilitated through trusted third-party payment platforms, ensuring a smooth and secure checkout process.

How TikTok Shop integrates with Shopify

To support its ecosystem of businesses, TikTok Shop integrates with various commerce platforms, including Shopify. There are some requirements to connect TikTok Shop with your Shopify store, such as having a TikTok for Business account, a return policy, and meeting TikTok’s product guidelines. TikTok Shop is also limited to specific locations.

Setting up TikTok Shop with Shopify involves accessing the Shopify admin to add TikTok as a sales channel via the Shopify App Store. After adding the channel, you need to connect your Shopify account to TikTok Shop. This process includes either logging into an existing TikTok for Business account or registering as a new merchant on TikTok. 

The setup requires verifying shop information and uploading necessary documents, following the acceptance of TikTok Shop Merchant Terms of Service. For detailed step-by-step instructions, it’s recommended to refer to the ‘ TikTok for Shopify - User Guide’ on TikTok Shop Academy.

Accounting for TikTok Shop Sales on Shopify with A2X

How A2X integrates TikTok Shop with QuickBooks or Xero Diagram

With over a billion active monthly users, TikTok gives your business exposure to a vast audience. Its algorithm makes sure your content reaches the right people, boosting sales. But integrating Shopify with TikTok Shop can complicate payout reconciliation in QuickBooks Online or Xero.

Here’s where A2X for Shopify comes in handy. It automatically imports your TikTok orders and groups them into a single entry that reconciles in your accounting software. This integration ensures that your accounting records are accurate and up-to-date, saving you considerable time and effort. So yes, you can integrate TikTok Shop with QuickBooks Online or Xero thanks to A2X (if you’re using Shopify).

Like other payment gateways used on your Shopify website, it’s important to be aware of additional fees. The A2X for Shopify integration will identify any transaction types that pass through your Shopify site, such as gross sales, shippings, and sales tax associated with each order. However there might be additional transaction types that TikTok may add and deduct further to the net payout balance, and Shopify does not capture these items. Examples of transactions A2X might not capture are discounts, shipping fees, shipping fee subsidies, refunds, total fees, and commissions. 

These transactions are only available within your TikTok Shop admin, so it’s essential that you log in to TikTok Seller Center to itemize the additional revenue and expenditure that has been added or subtracted to this payment for purposes of entering this into the general ledger system.  To learn more about using A2X with TikTok Shop integrated with your Shopify store, visit the A2X support center

Integrating A2X with your Shopify and TikTok Shop setup is a game-changer. It streamlines your accounting, ensuring you spend less time juggling numbers and more time growing your business. With A2X, you can effortlessly reconcile your TikTok payouts, keeping your financials in check.

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