eCommerce Accounting Xero


eCommerce is no longer a luxury – it’s a vital part of any successful business strategy. But how do you make the online world work for you? From websites to social media, this guide will help you get started.

eCommerce can expand your business

eCommerce means doing business online. Put simply, it’s using the internet to promote and sell your products or services.

Some small businesses can survive without a strong online presence. For example, if you’re a one-person company working for long-term clients, perhaps you don’t need any extra work – at least not right now.

But for everyone else, being online isn’t just an option. It’s a necessity if you want to reach the widest possible audience.

Run your eCommerce business better with Cloud accounting from Xero

Building out a modern eCommerce system to support your specific requirements can be challenging. Because if you don’t choose the right technologies, you could end up spending more time managing your backoffice platform – and less time building your business. And how to ensure you have one, unified place to see the health of your business at a glance.

How Xero can help your business

Xero – the modern accounting system built in the Cloud for the Cloud – is the ideal hub of your eCommerce technology strategy. Because Xero connects seamlessly with leading shopping cart, inventory management, marketplaces, and sales tax packages, you can choose the backoffice solution that’s right for your eCommerce business. And with Xero’s powerful capabilities – from cash flow and inventory to receivables and payments – you can quickly view the health of your business anywhere, on any device, at any time.

So when you invest in Xero – and its eCommerce partner ecosystem – you can be sure you have the most up-to-date technology that’s robust yet easy to use. And as a hub for your successful eCommerce system – through Xero’s seamless integration with the best of the Cloud – you spend less time maintaining your eCommerce system and more time expanding your product offerings or acquiring new customers. Beautiful.

Five questions to understand your ecommerce goals

If you want to know how to make the best of ecommerce, you need to ask yourself these questions:

1)How important is ecommerce to my business?

If you already have an established ‘real world’ business, maybe you’re looking to expand your customer base online. A modest investment in ecommerce will let you test the waters. On the other hand, perhaps you’re planning an online-only business. In that case you’ll need to invest a lot more time and money.


A simple, open-ended question – so you can think about your motivation. Do you want an ecommerce presence because everybody else has one? Or because you understand how it could help your business? A useful resource here is the ‘Start with why’ TED talk from Simon Sinek.

3)What’s my timeline?

How long do you think it will take for ecommerce to pay off for you? Will it be profitable in three months, six months, or 18 months? Use your accounting software to make some forecasts, so you can budget sensibly.

4)Are my customers ready?

Ecommerce is widely-used and effective. It’s a must-have addition to almost every business. But not all businesses. Perhaps your customers come to you through word-of-mouth or local advertising. If your business is already growing well, the investment might be better spent elsewhere – or postponed for a while.

5)Is my business ready?

This could be the most important question of all. If your ecommerce investment is successful it could change your business almost overnight. Make sure your cashflow is good and all your accounts are in order. Be ready for any new business that comes your way.

Don’t forget your taxes

Doing business online means you might be selling into different jurisdictions – or even different countries.

This can make tax calculations tricky, especially sales taxes, which can vary a lot from one place to another.

Make sure you understand all your obligations when it comes to taxes. Ask an accountant to help you get started, and choose good quality accounting software to process the numbers.

This is something you can’t afford to get wrong, because the legal penalties can be high.

Keep your business compliant

Just because your business is online doesn’t mean you can ignore the real world. Like any other organisation, your business must:

  • Be registered as a business entity

    Such as partnership, corporation or limited liability entity.

  • Keep detailed records

    Of all transactions, sales and purchases.

  • Have suitable insurance

    To protect you, your employees and your customers.

  • Obey all laws and regulations

    Especially those regarding employment, payroll, accounting and taxation.

Don’t forget about mobile

More people are accessing the internet on mobile devices such as smartphones and tablets. In fact mobile users make up 50 perent of all web traffic – and it’s growing all the time. So your ecommerce website must be accessible and usable on mobile platforms.

This is something you should discuss with your web development company. There’s no need for you to learn the technical details, but make sure the following boxes are ticked:

  • Fast and responsive. Mobile users don’t like to wait for sites to load.
  • Easy to navigate. Don’t force users to tap their way around your site.
  • Big user interface. A finger on a touchscreen is less precise than a mouse click.
  • Uncluttered. Steer customers where you want them to go.
  • Easy to search. Let your customers bypass your navigation to find the product they want.

    Don’t confuse a mobile-optimised website with a mobile app. They are two different things. Start by getting your website right. Then you can move on to getting an app developed if you have the budget for it.

Tie your business together

Ecommerce shouldn’t be a separate part of your work. It should be tightly integrated with the rest of your business.

Whether you’re selling online or through a store, your customers deserve the same great service. Keeping everything together makes it easier to track sales performance and manage your inventory.

So use whatever tools you need in order to keep your business fully integrated. There are cloud applications to handle inventory, accounting, payroll, marketing and more. These will help you keep tabs on every aspect of your online presence.

That way you can make the most of your eCommerce business – wherever you happen to be.

Please contact us if you like to know further.