The COVID-19 pandemic and the crisis that followed changed the landscape of the e-commerce industry. According to Shopify Plus’ The Future of Ecommerce Report 2021, “At the height of the COVID-19 pandemic, 10 years of ecommerce growth happened in just 90 days.”
E-commerce is expected to get even bigger and better as time passes, and people’s buying behavior is likely to boom alongside. Even now when things seem to be getting better — along with an increasing number of people getting vaccinated — people are still choosing to shop online because they do not want to step out and risk any exposure. The Future of Ecommerce Report 2021 reveals, “Ecommerce as a percentage of total global retail sales will also continue to grow over the next five years.” New technologies and trends will play a huge role in achieving this feat.
Check out five e-commerce accounting trends that are expected to see a rise in 2021:
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Shift to outsource e-commerce accounting
– Research says organizations can, on average, achieve a 15% cost reduction through outsourcing. Outsourcing the e-commerce accounting function allows business owners to cut overhead costs because they don’t have to spend on salary and such benefits as retirement, vacation time and health insurance. IThey also don’t need to spend money on software and the equipment essential for handling the accounting processes.
Accounting mistakes can have disastrous repercussions on a company, such as penalties, cash flow issues and even an investigation by the IRS. Outsourcing the e-commerce accounting functions gives them access to a team of highly qualified and trained professionals, who use the latest technology and processes to ensure that your data is accurate and secure.
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Move to cloud accounting
– Organizations are increasingly shifting to cloud accounting for several functional and economic reasons. Research shows that cloud-based software can cut labor costs by as much as 50%. With cloud accounting tools, several tasks can be automated. This not only saves time but also ensures data accuracy and integrity — encryption and tight security measures make the cloud more secure than local storage devices in many ways. Also, cloud software can be accessed from anywhere; all you need is an internet connection.
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Multiple payment options
– Cash payments are now a rare thing, especially since the COVID-19 breakout — since more and more people are shopping online now. Users are more comfortable using either credit and debit cards, or apps such as GooglePay, PayPal and ApplePay. This is where the complications can come in because with money flowing through different mediums, it can get difficult to make appropriate entries, and discrepancies add up in cases of chargebacks.
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Regular auditing of accounts
– In 2021, almost all accounting functions are expected to be automated, which means that the transactions risk getting stuck, failing or money getting credited to the wrong account. Therefore, accountants will need to be more vigilant when inspecting transaction histories and bank accounts to ensure that book entries match cash flow.
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Data analysis
– Accounting is not just about maintaining balance sheets; it also covers interpreting data with accountants acting as financial advisers. Accountants also need to visualize data in a coherent format and formulate effective strategies by making use of advanced technology.
