Do I Need A Bookkeeper for my Shopify Business? 10 Signs

Running a Shopify business can be, pretty straightforward in the beginning. You make sales, keep expenses low and ship a few orders at this stage. It’s easy to assume that everything is going well and you have a solid grasp on your finances.

However, as you grow faster and faster, things can change.

Now you have to deal with multiple gateways, transaction fees, refunds, charge bags, inventory, costs, and taxes. A business that was one simple and straightforward is now a confusing mess. And without a proper system in place, it ends up becoming much harder to ask simple questions.

Many Shopify store owners who push bookkeeping aside at the beginning of your business journey typically run into this problem. By the time you pay attention attention it, your records become disorganized, details are missing and tax season turns stressful.

So how do you know when it’s time to go help?

In this guide I’ll walk you through 10 clear signs that your Shopify business needs a bookkeeper. I will explain what a good bookkeeper actually does and how they support you and can save you time. This is an efforts to help reduce stress and give you a clear picture of your business finances.

What Can a Bookkeeper Do for a Shopify Business

Before diving into the signs, it helps to get some context on what bookkeeper can actually do it for you.

At the basic level, a bookkeeper is responsible for keeping your financials, accurate organized and up-to-date. This includes recording every transaction in the flows business, including sales refunds, expenses, fees, and more. Ultimately, their job is to take a lot of the bookkeeping tasks off your hands and into theirs. They do this by managing your Shopify bookkeeping entirely by themselves or by creating workflows to automate some of the tasks for you.

On a day-to-day basis, a bookkeeper will track your income expenses and categorize these transactions properly. They will then reconcile your accounts to make sure that it matches what is happening in the bank statements. Typically at the end of every month to prepare financial reports to give you a clear picture on how your business is doing.

For Shopify stores, bookkeeping goes a step further. Bookkeepers must reconcile the payouts from platforms like Shopify payments, PayPal and stripe in order to ensure that the bank account aligns with the sales after fees and adjustments. They also track cost of goods sold, monitor inventory related cost and help manage sales tax obligations.

If you make sales internationally, they can handle multicurrency transactions and exchange rate differences.

Ultimately, the right bookkeeper doesn’t just organize your books, instead to create workflows around your business to provide useful insights.

Why Bookkeeping is Critical for Shopify Stores

Many people mistake bookkeeping as just categorizing things within an accounting software. However, ecommerce accounting is a little bit more complex than that. Unlike a traditional retail set up, Shopify doesn’t simply deposit your full sales into your accounting software. Instead, it takes the sales, deducts payment fees, as well as refunds and deposit the difference. If you’re not sure on how to properly adjust for the differences, you will have a hard time getting accurate finances.

In addition, you have to account for actual expenses associated with your business. Such as advertising, production cost, shipping cost, and other subscription costs. If you were to look at your sales in your Shopify dashboard, without accounting for these other expenses, you may think you’re profitable. When in actuality, you may be losing money.

Poor Shopify bookkeeping can also create problems during tax season. Missing records, and mis-categorized expenses or incomplete data can lead to over paying taxes or fees and penalties for incorrect filing.

On top of that, a distorted financial data can make it harder to make financial decisions. For example, if you are not sure how much inventory remains after selling, you may order inventory that is too low or too high. This means you will either fail to meet demand or waste money that could be used for other means.

Ultimately, understanding the critical nature of bookkeeping will help you stay on top of your finances, become compliant with tax requirements and helps you make confident informed decisions about your business.

10 Signs You Need a Bookkeeper for Your Shopify Business

1. You Don’t Know Your Monthly Profit

If someone asked you, “How much profit did you make last year?” – would you know the answer?

Many Shopify owners think they’re doing well because the sea cells coming in. But there’s a big difference between sales and your profit. Without proper bookkeeping that’s who might confuse you.

Your Shopify dashboard might give you a clear picture on gross profits, but it doesn’t account for other expenses such as advertising or any other expenses related to your business. Once you factor out those expenses your profit can look very different.

A clear sign that you don’t know your actual monthly profit is only checking your Shopify dashboard for for performance. You rely only on this without consistently tracking expenses are your bank balance. This habit can give you a false sense of how your business is really doing.

A bookkeeper can help mitigate this by introducing your finances to an accounting software to help organize both your sales and your expenses. This will to give you a clear picture of your profits on a monthly quarterly or yearly basis.

2. Your Books are Always Behind

If you’re always behind on bookkeeping for your Shopify business, this is a strong sign that you need support.

I get it, you get busy and fulfilling sales seems more important to your business than doing the actual bookkeeping. While this is true, if you don’t keep your bookkeeping up to date, you will not know if you have enough sales to operate your business. As your business grows, other priorities take the lead and push bookkeeping to the bottom of your to-do list, which can make it challenging.

Falling behind on bookkeeping can lead to missing or duplicate transactions and correct record in a lot of unnecessary stress. You might also end up running quite a large bill if you hire a bookkeeper to clean up that mess.

3. Tax Season is Stressful and Confusing

Tax season is probably one of those most important deadlines for your Shopify business. If you’re scrambling to pull things together for your business, when tax season rolls around, it is probably sign you need a bookkeeper.

If you’ve not done your Shopify bookkeeping, tax season can be a major source of stress. This is because you could be missing out on deductions or even refunds that may be owed to your business. At the same time, you could owe penalties for not filing your taxes on time or unprepared to pay a large balance.

A good bookkeeper can help illuminate this chaos by keeping everything organized daily and year-round. With accurate bookkeeping you are more prepared when tax season comes around and can anticipate any surprises. Your numbers will be correct, your deductions will be accounted for, and your financials are done properly.

4. You’re Spending too much time on finances

If you find yourself constantly categorizing transactions, staying up late to upload receipts or fixing bookkeeping errors, it’s worth asking whether this is the best use of your time. While these things are important, they did not contribute to the growth of your business.

Every hour spent managing accounting software can be used towards high impact activities like marketing, products improvement or building your brand. Overtime, the trade off can drastically, slow growth.

There’s also hidden cost of efficiency. Without proper systems or expertise, Shopify bookkeeping tasks often take longer than they should, and are more prone to mistakes. Leading to a bit more time spent correcting them later.

It is best to let a bookkeeper take the workload off your plate. They can handle the day to day financials and free up your time so you can focus on growth.

5. You’re Scaling Your Business

Growth is probably one of the telltale signs that you need a bookkeeper for your Shopify business.

As your business is growing, you need all hands on deck. This means being able to outsource tasks efficiently so that you can make the right decisions to focus on growth. One of these tasks is bookkeeping. As a business owner, you do not want your decision making tied on bookkeeping cause I can create a bottleneck as your business grows.

You also need to have clear financials to understand how to properly scale your business. These figures are best handled by a professional bookkeeper or accountant who could give you a clear financials on whether or not you are ready for growth. The right bookkeeper can can help you make sense of the numbers you need to handle the increase in volume that are to come from your growth.

As a Shopify owner, another part of growing is having systems in place to accommodate growth. For example, at the beginning stages of business can be boggled down with a lot of hands-on tasks. However, as your business grows a lot of these tasks, need to be automated to make way for more important growth solutions. A Shopify bookkeeper can help implement these solutions so that your business can run more fit efficiently and without much intervention.

A bookkeeper will help you keep everything under control as you scale they can implement systems that grow with your business and ensure that your records are up-to-date giving you financial data. This is so that your growth does not outgrow your ability to manage it.

6. Selling to Multiple Countries or Currencies

It is common for many Shopify business owners to selling internationally. In fact, you might be doing yourself a disservice if you’re not. With this, however, comes the challenge of handling rules and regulations concerning currencies and tax implications.

There are certain rules that business must abide by if they plan on selling outside of Canada. One of these rules is the need to have all your financial reports in your home currency if you plan to sell internationally. This means that if you are a seller in Canada and plan to sell in United States, for example, you may collect sales in US dollars. However, when you record them, you must convert the currency to Canadian dollars. It would be an accounting nightmare to have multiple currencies on your financial report. This ensure that the monetary value being used for your business, is consistent. Fortunately, most accounting software’s are able to handle bookkeeping for Shopify businesses with multiple currencies.

Another issue you may have is handling the tax implications that comes from selling to multiple countries. If you have a business in Canada and you want to sell internationally, depending on the product you sell, there are taxes and regulations that you must abide by. For example, selling products from Canada to the United States may not require you to charge sales tax. This is especially true if your business is physically located in Canada, and a product or service was made, and shipped from Canada into the United States. The rules may be different if your business is in Canada however, your products or services were made, and shipped from the United States to a customer. The rules can become complex based on your industry. As such it is best to hire a professional to help you navigate these intricacies.

Lastly, Shopify bookkeeping for different currencies or tax system can be very complex. You have to account for currency conversions, fluctuations in exchange rates, and also different tax regulations based on your customers location. If you don’t track these properly, financial data can be very inconsistent. Revenue can be misreported due to incorrect exchange rate data, and this can lead to compliance issues and unexpected liabilities.

7. You Have Multiple Gateways

Most Shopify businesses rely on multiple payment gateways. These include platforms like Shopify payment, PayPal, stripe and buy now/pay later services to give customers a little bit more flexibility. While this is convenient for customers that can add a level of complexity in your bookkeeping.

Each payment gateway has its own structure, payment schedule, and also reporting system. Some of them take days to deposit funds while others are instant. Fees are also deducted at varying stages and refunds or chargebacks may be handled separately. As a result, you may have discrepancies between what these payment gateways collect versus what is actually deposited in your bank. The results can be a reconciliation nightmare.

A bookkeeper, insures everything is tracked correctly. They will reconcile each payment source, record fees properly, and make sure that your books align with your actual bank deposits. This gives you a clear and accurate picture of your revenue without the confusion.

8. Your Inventory is Hard to Track

Shopify businesses who have a lot of inventory, need a system to accurately track it. As your Shopify business grows this becomes a very complex challenge. You need to be able to account for stock levels, account for incoming products and sold products, and accurately calculate the cost of goods sold. If you have multiple suppliers or storing inventory in different locations, this becomes even more difficult.

If you don’t calculate inventory correctly, profit margins will be off. You might think certain products are highly profitable, windy or not or I would look at items that are actually performing well.

You still need to account for unsold inventory, which represents a cost to your business.

Bookkeeper, help set up and maintain systems that track inventory accurately with the right process in place. You have a clear understanding of your margin, stock levels, and overall financial performance, making it easier to make informed decisions about your products and growth.

9. You’re Planning to Get Funding or Sell Your Business

If you’re planning on raising capital or eventually selling a Shopify business financial records need to be in good shape.

Regardless of who you’re planning on getting the funds from, having good financials are essential. Investors look at your numbers in detail before they decide on whether your business is worth investing in. They typically look at profitability expenses, cash flow, and the overall health of your business.

Messy books signal major red flags to investors and banks. It slows down the process as you try to catch up and clean things up. It can also damage your credibility, reduce your business valuation or even defaults on the funding.

Clear financials gives you the confidence to step in front of investors to ask for funding with minimal concerns. A bookkeeper can ensure your records are accurate, consistent and presentation ready with clean financial reports. You being a much stronger position to secure funding or negotiate successful sales.

10. You Feel Overwhelmed by Your Finances

Sometimes the clearest sign do you need a bookkeeper isn’t about your numbers – it’s about how you feel about them.

If you’re regularly avoiding your finances, confused about reports or experience ongoing stress around money, chances are something isn’t working. Financial uncertainty can create constant mental pressure and make it harder to focus on growing your Shopify business.

This kind of stress is typically the results of unreliable systems in place. When your financial numbers don’t make sense or you don’t trust them, it’s difficult to make confident decisions.

Overtime distress can build in affect other areas of your work including strategy and day to day operations.

Hiring a bookkeeper will help you bring structure to your finances that will keep everything organized and provide clear reports to see where your business stands. Instead of feeling overwhelmed you can approach your finances with confidence and focus on moving your business forward.

How Much Does A Shopify Bookkeeper Cost?

The cost of hiring a bookkeeper for the shop at five business varies across various bookkeeping companies. There is no one size fits all, So it’s best to choose something that fits your budget and business lifestyle.

In general, most basic bookkeeping companies, price bookkeeping, using fixed cost method or hourly method. The fixed cost method allows you to pay a fixed bookkeeping cost for your Shopify business on a monthly basis. Generally this cost does not change until the scope of duties change drastically. The fixed cost method means you’re going to pay the same amount for bookkeeping on a monthly basis.

Hourly bookkeeping costs requires you to pay the bookkeeping company when they complete the work. Generally, with this, there’s no limits on the amount that the bookkeeping company can bill you because they are charging work done per hour. Shopify bookkeeping costs with this plan can vary greatly, depending on the hourly rate being charge for the bookkeeping.

Add people as books, we charge bookkeeping for Shopify business on the fixed cost basis. The prices are based on the amount of income. Your business is making the price only changes as you reach a sales threshold within your business. This means our prices grow only when your business grows. This price model allows you to have the flexibility of ongoing bookkeeping without the constant stress of regular price changes.

Check out our plans for monthly bookkeeping plans:

Conclusion

Bookkeeping is in just about staying organized. It’s about understanding your business. If some of the signs in this guide a plate see you, It’s definitely time to consider hiring a bookkeeper for your Shopify business.

As you Shopify business grows, you’ll find it increasingly important to have accurate numbers sent to you on a monthly basis. With the right support in place to be able to focus on scaling your business with confidence knowing your numbers are working for you not against you.

In the end, the real question isn’t just “Do I need a bookkeeper?”- it’s “How much does it cost to me not to have one?”