Amazon Bookkeeping for Sellers: The 3 Mistakes You’re Probably Making, and How to Avoid Them
Estimated reading time: 3 minutes.
Inaccurate or incomplete accounts can cause a multitude of problems, and make bookkeeping for Amazon sellers a nightmare. Nurturing a successful business is virtually impossible without solid numbers on which to base your strategy.
Check out the video below or our summary to find out why, according to Patti, these mistakes are easy to make, and discover the best Amazon accounting services out there to help you avoid them.
Mistake No.1: Not Accounting for Amazon Fees
Ever found yourself coding all your Amazon bank deposits as sales? It seems a straightforward solution to managing your accounting entries for Amazon sales, but as Patti warns, it is a mistake.
The problem: The money arriving into your account is your cut after Amazon fees. These could be anywhere from 15-40% according to Patti and, as she found with her clients, these can go up over time:
“We just found out in January that almost all of our clients noticed that all their fees from Amazon went up. If you’re not paying attention to that, you don’t know.”
- Patti Scharf
Mistake No.2: Not Accounting for Sales through Amazon Settlement Statements
PSA: settlement statements are not the whole story. They do not give you all the information you need to complete and reconcile your books accurately.
The problem: Settlement statements miss some crucial information. They do not show you how much sales tax you have collected, for example.
In addition, each statement might cover just a week or two, and cross over months, so when it comes time to reconcile, it’s easy to misinterpret your sales for a specific month.
“…that means you can’t track what you’re selling over time, you can’t track fees over time, it’s all just kind of a hodge-podge…”
- Patti Scharf
Mistake No.3: Not Summarising your Amazon Business Bookkeeping
Downloading your individual orders from Amazon will give you complete information about sales, but large spreadsheets of all this data become an issue when reconciling against batch settlement statements.
The problem: A lot of Amazon reports don’t match each other. Even selecting the same periods on two different reports might show inconsistencies. Plus, a large quantity of information is not handled well by software like Xero or Quickbooks for Amazon sellers of a bigger size. Ideally, information should be entered in summaries.
“If you’re selling 10 orders a month, it’s not a big deal. If you’re selling 10,000 orders a month, it is a big deal… it’s going to crush your system because your accounting system was not built to house all of that information.”
- Patti Scharf
A2X: The Best Software Solution for Amazon Business
Patti came across A2X in 2014, and in her own words, it changed her life:
“It is an amazing tool, I highly recommend you look into it. This is the right way to record your accounting for Amazon.”
- Patti Scharf (5:18)
A2X breaks down all transactions for you to stay on top of fees, track your business performance over time and match up large quantities of data. Even accounting for different currencies, time zones, tax codes and dates on statements, you’ll be able to balance your books with a few clicks of your mouse.
The bottom line accounting must-have for ecommerce sellers, A2X is an Amazon bookkeeping service that makes your Amazon seller accounting simple, easy and efficient.
Say goodbye to all these easy accounting mistakes today and try out A2X for free!
Also on the blog:
- An Insight into the Catching Clouds Academy for Amazon Sellers
- Here’s How to Spend Less Time on Your Amazon Accounting and More on Your Business
- Intelligent Automation for the Amazon Seller
- 5 Growth Opportunities for Amazon FBA Sellers
- Amazon FBA Secret Recipe for Success
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