Owning an Amazon business comes with its own unique set of challenges, and one of them is bookkeeping. While you may know everything about your product, do you fully understand your bottom line?
Figuring out if you are making money and how much can be a tricky equation to get right. If you want to handle your own bookkeeping, here are some basic tips to help you gain a better grasp on your finances.
Start with a Business Checking Account
One of the first steps you should take as a business owner is to open a business account. This account will help you keep your personal finances and your business finances separate. While you may need to borrow from your personal account initially, just transfer the money from one account to another.
You can also open up a business credit card. But only use it for business expenses, and be cautious of getting into too much debt.
Choose the Right Software
Just because you are doing your own bookkeeping doesn’t mean you have to do all the heavy lifting yourself. Invest in a good bookkeeping software to help make things easier.
We recommend software that gives you all the information you need to determine the health of your business, file taxes when the time comes, and to sufficiently and automatically backup your data. That system might not always be the cheapest, but it will save you headaches down the road.
Another important aspect of your software is its ability to give you real-time updates. As a business owner, you need to know exactly how your business is performing at all times to help you make quick decisions.
Even if you use software, however, you will still need to compare your records to what you see in the bank. Double check that your deposit payments are there.
Don’t Make Assumptions
Too many sellers make assumptions about their ROI or product costs. This is dangerous and can even lead to the failure of a business. Do not assume or estimate anything! Make sure that you understand all of your costs. Consider shipping, packing, labor, time, etc. to get an accurate representation of your business’s financial status.
Know When It’s Time to Get Help
If bookkeeping is becoming overwhelming, it’s okay to get help! There are many companies out there that can offload some or all of the responsibility to give you time to actually run your business. For example, LedgerGurus is a great source!
Hiring a company or a business advisor can really help you simplify your accounting processes and provide you with additional insights into managing your assets.
For more information, join us in a webinar on April 12. Learn the basics about Amazon bookkeeping, cost of goods sold, and inventory accounting with LedgerGurus. Go to nozani.com/webinars to register.
About the Author: Alyssa Ball has been working in digital marketing for several years. She graduated from Brigham Young University with her degree in English linguistics and is currently pursuing an MBA. Alyssa’s position as a content writer and keyword strategist at Nozani has allowed her to master both Google and Amazon SEO.