The eCommerce industry continues to grow as customers become more comfortable shopping from their phones and buying products online. According to forecasts by eMarketer, American consumers will spend more than $700 billion in eCommerce purchases for 2020, an 18% increase over previous years.
Ecommerce has created countless opportunities for small business owners. Within a few days, you can launch a website and start selling products from your home. You can also expand your brick and mortar business with online sales. While launching an eCommerce business is easy, you still need financial know-how to make sure it stays profitable. Here’s why you need an accountant for your eCommerce store and annual tax forms.
Hiring an accountant reduces your operating budget.
As your eCommerce business grows, so will your operating costs. What starts as a small business in your home can expand into a co-working space and eventually to your own offices and warehouse locations. Setting up these operations costs money. You will notice higher electric bills, will need to hire more personnel, and will have to grow your office supply budget. You will need everything from envelopes to flash drives bulk ordered to help your employees stay organized.
Outsourcing your accounting services can cut down on these operating costs. You only have to pay a flat fee each month to the accounting firm instead of paying employee salaries, healthcare benefits, and extra rent for a larger office space. You can also enjoy the peace of mind knowing you don’t need to keep tax organizer envelopes and bulk USB drives in stock.
This video can help you understand how to outsource your bookkeeping to a trusted accounting source.
Accountants find opportunities to improve your business.
Accounting is detective work. It involves looking for patterns and clues to help your eCommerce business thrive. Accountants pride themselves on finding ways to help clients save money, whether it means using a different shipping provider and/or changing your materials vendors. The accounting services you hire should pay for themselves within the year.
To get an idea for how much you should expect to pay for accounting services, know that 23% of small business owners spend less than $1,000 annually on accounting. A third of small business owners spend less than $1,000-$5,000. You can contract out an accountant for a few hours each month and still reap the benefits of having better-organized payroll services and clearer IRS tax forms.
Your eCommerce business needs a champion during tax time.
Accounting is one of the most complicated departments in your business. Not only do you need professionals to make sure your business is profitable, but you need to hire experts who understand the guidelines set out by the IRS. According to a survey by NerdWallet, most Americans don’t fully understand the country’s tax system. As a business owner, you can’t be expected to be a tax expert while growing your eCommerce brand—you need an accountant to help you out.
An accountant will anticipate the threats and opportunities related to your IRS tax return. They know how to track your sales tax numbers throughout the year and what it means why you sell products across state lines. They can readily prepare your tax forms with the information you provide, ensuring that your documents are submitted on time in the proper tax return envelopes and with the maximum refund. If you want a smooth tax season, you need an accountant on your side.
The accountant you hire can guide you through the technical aspects of running an eCommerce business. They can help with W2 protocols and tax forms alike. You don’t have to be an expert in everything related to the IRS to save money during tax season. Focus on growing your ecommerce business and let your accountant do the rest.