Indian e-commerce is expected to reach US$ 300 billion by 2030. With rapid advancements in technology, we can only expect these numbers to grow. Owing to the growing digital landscape, e-commerce companies are all about a dynamic business environment, high transaction volume, and compliances.
E-commerce companies are also fundamentally different from traditional brick-and-mortar businesses. While in the former a customer goes into a store and makes a purchase directly, in an e-commerce transaction, there are complex payment gateways and transactions involved.
This is precisely the reason, to keep your e-commerce business’ financial health stable while allowing you to be profitable, you need to learn e-commerce accounting and how accounting software for e-commerce can help you make informed decisions while ensuring your long-term success.
Read on to know more.
The accounting needs of e-commerce businesses
E-commerce accounting is unique because it tracks all your transactions online. While traditional business accounting is all about focusing on physical transactions, e-commerce accounting is about digital transactions.
There are other reasons too that contribute to the uniqueness of e-commerce accounting:
1. High transaction volume
As compared to traditional businesses, e-commerce businesses have to deal with a high volume of transactions. This is mainly because of the online nature of business, which makes an e-commerce business remain available to consumers 24/7.
2. Online nature of payments
E-commerce platforms need to rely on payment gateways to receive and process payments. This means that you not are not just tracking your sales, revenue, and payments, but also the processing fee charged by payment gateways. Not to mention that this fee varies from one gateway to the other.
3. Management of the inventory
Another factor that makes accounting needs unique for e-commerce businesses is that you need to manage your inventory in real-time across multiple sales channels, making it more complex than inventory management in traditional businesses.
4. Data collection
An e-commerce business collects data from several sources including shipping carriers, payment gateways, and online sellers.
5. Tax considerations
Since e-commerce companies sell their products across geographies, nationally and internationally, it involves complexities related to tax compliance. Understanding these taxation obligations and integrating them with your accounting procedures is important for avoiding legal hassles.
6. Sales of digital services and goods
Some e-commerce businesses sell digital goods. These include subscription-based services, licenses, or digital downloads. All these have specific accounting considerations.
7. Returns and refunds
E-commerce businesses deal with a high rate of returns and refunds. It is essential to keep a track of these transactions while making revenue adjustments and tracking your inventory.
8. High level of technological integration
Since e-commerce businesses are all about digital transactions, there is a high level of integration between accounting systems and technology. This is important for accuracy in financial management and reporting.
Features to look for in e-commerce accounting software
Here are some top features to look for in accounting software for e-commerce:
Integration capabilities
An e-commerce business operates in a complex ecosystem of e-commerce platforms, payment gateways, tax regulations, high volumes of sales, etc.
The accounting software for e-commerce that you choose must have the ability to seamlessly integrate with all these aspects and help your processes get simplified.
Recording a range of financial transactions
Every e-commerce business has to deal with a high volume of financial transactions, which is much higher than traditional businesses. These include management of ledgers, invoices, payment records, returns and refunds, and many more.
The accounting software for e-commerce that you select should have the bandwidth to manage all these functions while offering real-time support to your teams.
Bank reconciliation
To ensure accuracy in your financial data, your records must match your bank statements. This is a tedious process to follow manually. Your accounting software for e-commerce should automate your reconciliation process and highlight any discrepancies that may indicate errors or even frauds.
Tax compliance
An e-commerce business has to operate in a multi-layered taxation framework. One of the most critical features to look for in your software is its ability to comply with Indian tax rules to help you generate GST invoices and file your tax returns.
Reporting abilities
Financial reporting is essential to assess your financial health. You can only generate timely and accurate reports when you have robust accounting software for e-commerce. It should help you with automatically generated reports that save you time and ensure accuracy as you assess the financial status of your business.
Better security
Financial data is sensitive and needs to be kept secure at all times from unauthorized usage, data loss, and fraud. The software that you choose should offer impermeable security features like data encryption, data backups, and controlled access.
Scalable
As your e-commerce business grows in scale, its accounting needs will change. An important feature of e-commerce accounting software is that it should be scalable to accommodate this growth through advanced features to handle an increasing number of transactions,
User-friendly
An essential feature to look out for is easy navigation and usability. The software must come with easy instructions for even non-accounting teams to use and access.
Excellent customer support
Since the e-commerce industry is extremely dynamic, its accounting needs are also constantly changing. What helps is a robust customer support service that offers solutions to queries in real-time. This means being responsive with clear instructions and support at any time of the day.
Why Mocha Accounting is the best free choice for e-commerce?
Now that we have listed the essential features that accounting software for e-commerce should have, it is time to help you navigate your way through the endless software choices available today.
It can be challenging trying to figure out the features and technical specifications of each software and narrow down the best option for your business.
While there is no one-size-fits-all option, Mocha Accounting rises above all the software options available and their features. Based on several researches and customer feedback, here are some great reasons why Mocha Accounting is the best free choice for accounting software for e-commerce:
It helps you establish a stable financial accounting model
The overall profitability and viability of any e-commerce business depends on its financial stability. It is imperative for a business to know its stability ratio. When you use Mocha software for your e-commerce business, you are assured of evaluating your cash flow and any negative scenarios that your business may be operating in.
It also helps you plan your inventory levels, revenues, and invoices while minimizing errors and streamlining your tasks.
Mocha Accounting is Simple and Intuitive
One of the most important advantages of Mocha Accounting software is that it is extremely easy to understand and work with. It has a simple DIY platform and an intuitive design to make your processes much easier than they already are.
Our software also allows you to experiment and create customized flows for your business needs.
It is mobile-commerce adaptive
Since most shoppers now use their mobiles to shop, most e-commerce businesses now operate through mobile commerce. Our e-commerce accounting solution is mobile commerce ready and offers a mobile-ready website on iOS and Android platforms.
We offer multi-channel integration
In the dynamic world of e-commerce businesses, it is impossible to operate in isolation. It is critical to integrate your business with several third-party tools.
Mocha software for e-commerce businesses allows you to integrate with multiple logistics channels, payment gateways, and shopping platforms at the same time to ensure that your processes run seamlessly.
Real-time financial reporting
Mocha accounting software for e-commerce helps you keep all your financial data up-to-date. We understand that any lags can lead to expensive delays for your business. All your balance sheets and income statements are updated in real-time and reports are generated automatically using the most current information for you to take corrective action at the earliest when required.
We allow seamless integration with other business tools
Mocha accounting software for e-commerce seamlessly integrates with your other business tools such as CRM, inventory management, payroll, etc. to ensure that there is a smooth data exchange between these tools while minimizing the possibility of errors.
We are cost-effective
One of the top reasons why Mocha accounting software for e-commerce is preferred is because we are extremely cost-effective. We offer subscription-based pricing options where you can pay only for what you use, making our ROI amongst the top in the industry.
Timely and automatic updates
Our software has inbuilt update systems for regular upgrades and maintenance. This allows you to use all the latest features without manually installing them leading to reduced downtime and less stress.
Mocha accounting helps in compliance support
Our software adapts itself automatically to the latest tax and financial regulations and standards so that your business complies to all the laws and rules with zero possibility of error or legal hassles.
Excellent security measures
We offer stringent security features to protect your sensitive financial information. These include regular backups, data encryption, and controlled access. Our software is also designed to undergo automatic backup once a day to preserve your precious data.
Conclusion: Simplify your e-commerce accounting with Mocha
Mocha accounting software for e-commerce can benefit e-commerce businesses of any size and scale. We have helped thousands of businesses improve their financial health, and stay relevant in today’s hyper-competitive environment while having a great growth trajectory. To know how we can help you, contact us today for a free demo and trial of our software.
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