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E-commerce accounting

Featuring Ben Richmond, managing director, North America, Xero
Ben Richmond, managing director, North America, Xero, is responsible for driving Xero’s growth in the United States and Canada. In 2013, he joined Xero as New Zealand sales director, where he led the business’s national growth and spearheaded Xero’s global agriculture strategy.

Q What makes e-commerce accounting a challenge? 

A E-commerce business and sales have precipitously been on the rise, particularly postpandemic, and are slated to continue on an upward trajectory indefinitely; as such, more and more small businesses are using multiple platforms (e.g., Amazon and Shopify) to sell their products and increase their reach. As a result, there are more channels and more sources of revenue to manage, and it’s therefore easier for the backend and “the books” to get out of date. A tool like Xero Inventory Plus will help reduce the manual burden accountants and bookkeepers spend reconciling inventory in multiple channels for multiple clients, freeing up time to focus on more strategic endeavors. 

Q What opportunities do accountants have to better serve their e-commerce clients? 

A E-commerce small business clients often have more streams of revenue than a typical brickand- mortar small business client, and, as a result, it’s often harder for the former to understand where their cash flow stands. As such, accountants have an opportunity to dive deeper into what’s supporting and what’s detracting from their positive cash flow and become more heavily involved in the strategic decision-making surrounding growth levers. This is a key moment in time for accountants to step into the role of adviser and play an integral role in the trajectory of their clients’ success. 

Q How can the right tech stack help e-commerce businesses and their accountants?

A One of the biggest challenges accountants and bookkeepers face with e-commerce clients is having one source of truth for information. Consider the following: A seemingly simple order requires the business to locate, pack, and ship a product, resulting in data covering the sale, taxes, inventory adjustments, and shipping costs. Accountants and bookkeepers often receive this data in multiple spreadsheets, sometimes in different formats and at inconsistent intervals. All this complexity can even lead accountants away from accepting such clients. Being able to manage all those items within one system that brings it all together allows accountants to more confidently serve these clients and help them to streamline their processes. In addition to creating greater efficiency, this can enable expansion into new services and revenue streams, supporting sustainable firm growth.

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Xero is a global small business platform with 3.95 million subscribers, including a core accounting solution, payroll, workforce management, expenses, and projects. Xero also has an extensive ecosystem of connected apps and connections to banks and other financial institutions helping small businesses access solutions from within Xero’s open platform to help them run their business and manage their finances.