Xero Amazon Integration Guide [How To Set It Up]
Estimated reading time: 14 minutes.
As a financial hub to help you record, crunch and analyze your sales, Xero is a great software option for Amazon sellers.
Designed to grow with you, whatever size or stage you may be at in your business journey, Xero has your accounting covered.
But whilst automating the transfer of your financial data from Amazon to Xero is a core step, it’s not the end of the road. You still need to manually reconcile tens, hundreds - even thousands of orders as you grow, and that’s not sustainable.
There is a way to optimize your Xero Amazon integration so that everything becomes automatic. Here we’ll explain how to account for Amazon sales in Xero in the quickest, most accurate way.
In this Xero Amazon integration guide:
Table of Contents
Ready? Let’s get started.
What Does Xero Offer You, As An Amazon Seller?
Founded in 2006 in New Zealand, by a visionary team of entrepreneurs (like you!), Xero has a rock-solid reputation for enabling small business operators to manage their books with minimal fuss.
In fact, Forbes identified Xero as the World’s Most Innovative Growth Company in 2014 and 2015.
Here are some of the ways that Xero may benefit you, as an Amazon seller:
Automation saves you time
Xero automates much of your accounting so that you can focus your time and energy elsewhere.
Quick and easy system to learn
Xero is very quick and easy to learn, with a clear and intuitive interface.
Integrates with Seller Central
Xero integrates with your Amazon account for easy, seamless information transfer.
Accessible from anywhere
Xero is a cloud accounting software which you can access from any device with an internet connection.
Permission levels for extra control
If you have an accountant, want one in the future or may need to share some aspects of your accounts with other people, Xero allows you to set access permissions and control who sees what.
Xero upholds the strictest standards in data security. Everything is encrypted to keep your business safe.
Scalable for growing businesses
With the option to add other integrations, manage inventory and even expand across other sales channels, Xero has subscription plans to match your business ambitions.
If you haven’t signed up for Xero yet, you can access a free trial of the software here.
Xero and Amazon make a great ecommerce union, freeing you up to have time to spend on the bigger picture of your online business.
But in this era of accelerated innovation and constant improvement, even this can be improved.
Let’s have a look at optimizing your Amazon Xero integration.
How to Optimize Your Integration of Xero with Amazon
Amazon sellers deal with a lot of fees and transactions - probably more than sellers on any other platform.
Then there’s Fulfilment by Amazon (FBA) sellers, which have those plus a cohort of others on top, all of which are deducted from Amazon payouts before they reach a seller bank account.
Amazon sellers need to understand exactly how much was taken from their payouts and for which fees, which is easier said than done. Amazon settlement statements aren’t very detailed, so they require a seller to put a lot of time into figuring this information out for themselves.
This manual reconciliation can take hours, hours that sellers can easily get back by delegating this easy-to-automate task.
And if the machines do it, you know the calculations will be accurate.
Have a look at the following example. On the left is a simple settlement amount of $109,580 from Amazon, reflected in a spreadsheet.
If you imported that into your Xero account simply as ‘income’, it would not be accurate. Because it isn’t only income.
The right side of the spreadsheet shows the breakdown of the Amazon sales that led to the $109,580 net settlement. There were 8 different line items that affected the final settlement amount but were in effect ‘hidden’ from view:
Adding A2X into your tech stack is the difference between working with that left side of the spreadsheet and the right side.
How A2X Works for Amazon Sellers
A2X captures the settlement information from Amazon, calculates all those line items you would otherwise need to do yourself and organizes them into a neat journal summary.
Each settlement has a journal summary containing those lines of detail, like in the above example. Accurate accounting without the fuss.
A2X also organizes your books via the accrual method, a GAAP-recognized, industry standard for business bookkeeping.
There are peaks and troughs in any business. If you’re only tracking your business cash flow from day to day, you’re missing an opportunity to make the numbers work for you. And this is the problem that accrual accounting solves.
With accrual accounting, you get the bigger picture. A2X splits settlements that span months so that you can see exactly how your business has been performing by month and what’s coming up.
What Amazon sellers and professional accountants love about A2X
A2X saves time. It turns hours of manual reconciliation work into a few minutes.
“A2X has taken a very manual process for me and automated it. What used to take me a half hour or more can now be done with the touch of a button. This saves me valuable time and also saves my clients money.”
It reports Amazon transactions accurately, down to the last cent. Bank deposits always match sales numbers, neatly and clearly.
“We don’t have to think about that level of reporting any more, the data goes through seamlessly, and everything gets reconciled correctly. The software saves the need for running loads of separate reports for our accountancy and bookkeeping.”
Excellent support, across the globe. The A2X team has a ten-year track record in ecommerce. Their systems work, and they are there to help.
“A2X seamlessly transfers Amazon data to [your accounting software]. It made tracking closing fees and FBA fees so much easier! I recommend it to anyone who wants easy and accurate Amazon data reflected on their accounting software. Also, their customer service team is top tier. They really take the time to understand my issue and answer in a proficient manner. Once I asked them a question about another software, and I ended up getting a better and more practical answer from the A2X team than said software’s CS team!”
A2X facilitates business growth.
“This product has added a whole new aspect of scalability to our business, and saves a great deal of time.”
Ready to integrate A2X with Amazon and Xero? Let’s do it.
How To Integrate Xero And Amazon With A2X: A Step-by-Step Guide
Now we get to the good stuff. It’s good, because it’s simple, and has a heap of benefits for you.
We’ll walk you through how to set up A2X to integrate Amazon and Xero in no time.
Step 1: Create your A2X account
If you’re completely new to A2X, you have two options:
- You can sign up for a free trial of A2X on the A2X site.
- You can sign up for an A2X account directly from your Xero account, or using Google or Intuit.
Let’s have a quick look at Option 1:
You can try out A2X for free to see if it works for you.
On this page, you have three options to choose from:
Note that if you’re a semi-convert and already have an A2X account, you can log into it from this page too and follow the instructions.
Now let’s check out Option 2.
Create your A2X account in Xero
If you’ve already witnessed the happy union between Amazon and Xero in your business, but haven’t yet brought A2X on board, you’ll run with the option - ‘Continue with Xero’.
Got your Xero login details handy? Log in now.
Once you’ve signed up using Option 1 or 2, you’ll be taken to a page where you need to fill in a few more details.
Congratulations! You’re the proud holder of an A2X account. Easy, right?
You now have a dashboard for your new A2X account.
Next, we’ll show you how to link A2X to your Amazon account.
Step 2: Connect A2X to your Amazon account
Have a look at the top left of the screen on your new dashboard. Click on the Connect to ecommerce link.
A2X connects to your Amazon account by using an Application Programming Interface, or API. By clicking the link, you’re granting A2X permission to access data in your Amazon account, automatically.
Once you’ve clicked the link, you’ll arrive at this screen:
If you have an Amazon seller account, you’ll click on I’m the owner of the Amazon seller account.
If you’re an accountant or third party managing this process on behalf of a seller, then you’ll click on I’m requesting access to an Amazon seller account.
The next step is to choose your primary region and marketplace. Click on one of the three regions - North America, UK & Europe, or Asia & Pacific. Then select the countries in which you sell.
As an ecommerce entrepreneur, you could be selling products to customers in more than one location. You can select additional regions in your A2X settings on your dashboard at any time, as your business grows.
The Amazon Seller Central page will open. Sign in here, using the email address and password for your Amazon seller account.
Once you’ve signed in, you’ll need to read the agreement. Then tick the box and click Next to sign the Amazon API agreement.
This will give A2X permission to access your Amazon seller account.
The confirmation dialog box will appear. Click Continue. This will take you back to your A2X dashboard.
The green tick in the top right corner of the screen shows that you’ve successfully connected your A2X account to your Amazon seller account.
A2X is now able to import your Amazon settlement files.
To check all of your settlements in Amazon Seller Central, you can go to Reports > Payments > All Statements.
Step 3: Connect your A2X account to Xero
Now you need to connect A2X to Xero.
On the right side of your A2X dashboard, you’ll see Connect to accounting. Click on Connect to Xero.
We’ve covered the basic steps in getting you up and running, connecting Xero to Amazon, integrated by A2X.
Steps 4 and 5 take the process a step further - configuring accounting and taxes, and posting your Amazon settlements.
Step 4: Configure accounting and taxes
This is an optional next step but will save you lots more time down the line. This involves pulling your Xero Chart of Accounts into A2X, or electing to create and use new ones.
A note for multicurrency sellers
If your business is receiving payments in more than one currency, or selling in different regions, you will first need to have your currency settings set up in Xero.
To add a foreign currency in Xero, go to your dashboard in Xero.
- Click on your organization name.
- Click Settings, and Add Currency.
- Select the currency you want to add, from the dropdown menu, and click the green button Add Currency.
Here’s what you’ll see on screen:
Setting up tax rates in Xero
You only need to follow this step if your organization’s tax codes do not match the default ones in Xero. The tax rates you set can apply to sales as well as purchases.
- Go to the Accounting menu in your Xero account.
- Click Advanced > Tax rates > New Tax Rate.
- Add the tax component name you need. If GST applies to you, you’ll enter the applicable GST percentage.
- Click Save.
Now head back to your A2X dashboard.
Click Configure accounting and taxes. You’re going to follow the field prompts to enter tax information relevant to your region and country.
You can also do this from the Accounts and Taxes tab in your A2X account.
The beauty of A2X is that it enables you to use the same accounts that you have set up in Xero, to ensure the integration is seamless and all data is recorded exactly how you want it to be recorded.
Select the accounts applicable to your business by clicking on the ‘x’ next to the account type.
You’ll also need to select the tax rate (if applicable) from the dropdown menu under Tax Rate.
Tax compliance can be challenging for Amazon sellers, especially if you’re selling in more than one region.
We recommend you consult with a professional accountant to help you navigate this aspect of your business.
Once you’ve selected all the accounts and tax codes and rates relevant to your business, click on Save Mappings at the bottom of the screen.
Now you’re all set up for seamless integration between your Amazon and Xero accounts!
A2X is ready to access, interpret and generate user-friendly financial data for you.
FAQs and Helpful Tips
Does Xero integrate with Amazon?
Yes, Xero integrates with Amazon to give you hassle-free accounting for your ecommerce business. Better still, if you use A2X as a connector app between Amazon and Xero, you’ll have your financial data presented in such a way that you can forecast orders, income and expenses, and be able to make strategic decisions for your business.
What is the best accounting software for Amazon sellers?
Xero is excellent cloud accounting software for Amazon businesses. Xero enables sellers to reconcile their Amazon accounts and statements with what appears in their bank statements, as well as manage inventory and tax obligations. Built to support small businesses, its features make accounting for ecommerce simple and user-friendly. Find more Amazon automation software and options here.
Is there a way to make interpreting my Amazon transactions easier with Xero?
Yes. By connecting your Amazon account to Xero using a connector app like A2X, you can better understand your fees and transactions.
What if I prefer to have someone else do all of this for me?
If you feel you need some professional accounting support, we’ve got you covered on that front, too. Head over here for a list of trusted accounting partners who can help you manage financials for your Amazon business.
I’m lazy and can’t be bothered having multiple tabs open when I’m working on my financials. Help!
We hear you. One really flexible feature of Amazon and Xero integration with A2X is that once you’ve set up your account, and shared your details across both Xero and A2X, you can log back into A2X it from the A2X site, or from the Xero site - whichever is more convenient for you!
For future reference, here’s where you can sign in to Xero, from the A2X site.
Where can I find out more about A2X pricing?
If you’ve tried the free trial and fallen in love with how A2X optimizes your Xero Amazon integration, you can choose a plan that’s suitable for your business needs right here.
Also on the blog
- Amazon Automation Guide
- Amazon Taxes: A Beginner’s Guide to Doing it Right
- A Comprehensive List of Amazon Seller Transactions
- Using Spreadsheets vs. A2X for Your Amazon Accounting
- How Accountants Use A2X for Their Clients
- The Best Amazon Fee Calculators for 2021
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