Being a small ecommerce business is tough. Founders wear a lot of hats getting the business started, and as revenue and complexity grow, the demands multiply while time doesn't. It's usually too early for a full-time, in-house accounting team at this stage, but it's exactly the right time to bring in outsourced ecommerce accounting professionals.
Common complexities for ecommerce businesses
We talk to a lot of ecommerce business owners, and we hear the same concerns constantly:
- I don’t know how much inventory I have or what it’s worth.
- I’m not sure what our cost of goods sold (COGS) is or how to find out.
- I don’t know if I’m doing my sales tax correctly.
- I think I’m profitable but have no systems to confirm it.
- I sell on multiple channels and can't tell which one performs best.
- I'm frustrated by timing issues and complex reconciliations.
- I need a better way to handle payment processors fees.
- Returns are throwing off my revenues and inventory numbers.
- I'm overwhelmed by transaction volume, and my records are slipping.
Do these sound familiar? Our free 5 Ecommerce Bookkeeping Warning Signs download can help you spot which one is costing you the most right now.
Very few business owners start a business for the sheer pleasure of doing accounting, and yet as Brittany Brown, LedgerGurus' founder and CEO, is fond of saying: "Accounting is the language of business." If you don't speak it, you're missing valuable information you need to make important decisions, and that's exactly what outsourcing fixes.
Before we get to the five benefits, it helps to know what outsourcing can actually mean, since it isn't a single job title.
Bookkeeper vs. accountant: What's the difference?
Not all outsourced ecommerce accounting looks the same, and "bookkeeper" and "accountant" aren't interchangeable, even though people use them that way.
A bookkeeper handles the recording and reconciling, keeping your cloud accounting system current: weekly payroll and invoicing, monthly bank reconciliations and balance sheet reviews, quarterly budget checks, and yearly financial reports.
An accountant (or accounting team) builds on that foundation. Where a bookkeeper keeps the numbers accurate, an accountant interprets them, the financial analysis, forecasting, and strategic work covered in Benefits #3 and #4 below.
Most growing ecommerce brands eventually need both, which is why firms like LedgerGurus staff bookkeepers, accounting managers, and CPAs together rather than asking you to pick one role and hope it covers everything.
What makes an ecommerce specialist different from a generalist? Sales tax obligations that vary by state (and by country if you sell internationally), higher transaction volume with per-transaction fees, inventory spread across channels or a 3PL/FBA, and payouts that don't represent net profit until they're matched against sales, returns, shipping, and fees. A specialist has already built solutions for these quirks; a generalist is learning them for the first time on your books.
Choosing the right fit: weigh their scope of services against what you actually need done, whether you're working with an individual contractor or a firm with a deeper bench, whether a CPA oversees the work, and whether they actually have experience with your specific sales channels.
Benefit #1: Saves time and money
So why are you still doing your own accounting? Not tax prep, most owners know better than that, but the bookkeeping, invoicing, bill pay, and payroll. Every hour spent on those is an hour not spent selling, marketing, building your product, or serving customers.
Let go to gain visibility. It's natural to worry that outsourcing means losing visibility into your own numbers. In practice, it's the opposite: accounting professionals can go deeper into your finances than you probably have time for, which usually means better visibility than you had before.
Your time is better spent elsewhere. You may be good at parts of accounting, but you're probably a better engineer, marketer, salesperson, or operator, and every hour on the books is an hour not spent being that.
The critical accounting functions any business needs are:
- Payroll
- Invoicing
- Collecting receivables
- Bill pay
- Annual tax preparation
Necessary, but easy to skip accounting activities are:
- Bookkeeping
- Reconciling account statements
- Managing expenses
- Generating / reviewing financials
Many owners doing their own books skip this second set entirely, and it's exactly what gives you the insight to make good decisions and keep the business running smoothly.
Benefit #2: Get financial discipline
Growing ecommerce businesses tend to grow fast, and fast growth without financial discipline creates chaos just as quickly. Here's where discipline moves the business forward:
Financial reviews. Discipline starts with regular (weekly or at least monthly) reviews of the big three financial reports: the P&L or income statement, balance sheet, and cash flow statement. These show you where you're making and spending money, how much you have, and how it's flowing, which helps you make good decisions and measure their impact.
Expense management. Growth brings more employees and more role specialization, and it's no longer feasible for one or two people to control all spending. Sales, marketing, and other staff need room to support their work with appropriate expenses, but without proper policies and processes, that spending can get away from you fast.
Budgeting is the hallmark of financial discipline. Spending on intuition only gets you so far before the bank account is empty. A budget lets you spend like Goldilocks, not too much, not too little, turning spending into smart investment instead of guesswork.
Benefit #3: Gain business insight
Business insight depends on getting the accounting essentials right first. Get them wrong, and even the best-looking reports are misleading. Get them right, and insight follows naturally. Start with the basics:
- What is our current cash balance, and does it cover upcoming expenses?
- How much do we owe suppliers and vendors (accounts payable)?
- Are we consistently profitable, or do we have periods of losses?
- Do we have enough inventory to last until the next shipment?
Once you're answering those, better questions follow:
- What are our profit margins on individual products or categories?
- Are we minimizing payment processing fees?
- Is our shipping efficient and cost-effective?
- How does our current position compare to our projections and goals?
Benefit #4: Be strategic
Everyone in business wants to be strategic, but how can accounting be strategic? Here are some ways:
Financial analysis turns financial reviews into real decisions.
- Who are your most profitable customers?
- Which products are growing or declining fastest?
- Are your COGS growing or shrinking in proportion to income?
- Are expenses outpacing revenue?
The answers live in your financial reports (or the transactions behind them), and with good bookkeeping and proper analysis, you can get them quickly. If you can't answer these easily today, we recommend the Diagnostic Toolkit for Ecommerce Sellers from Common Thread Collective, a DIY audit across 10 ecommerce KPIs. More on that in Unlock the Secrets of Ecommerce KPIs.
You can also see how you stack up against other ecommerce sellers in our Ecommerce KPIs Benchmarking Report.
Forecasting builds on good accounting practices, financial fundamentals, and financial analysis, plus sound sales pipeline management, to help you create accurate budgets and plan wisely. Great businesses use it to hire and spend well, prepare for cash shortfalls or windfalls, and grow profitably (or with a controlled loss).
Cash management ties it all together. Good bookkeeping, reviews, and analysis show you where your cash stands. Solid invoicing, bill pay, payroll, and expense management are the levers that move it. Forecasting and budgeting show you where it's headed. Doing this well is what it actually means to be strategic with your accounting.
Benefit #5: Attract investors
Growing ecommerce businesses and raising capital go hand in hand, but messy books and a great funding round don't. Friends, family, and even an early angel may go off your pitch and spreadsheets alone, but as the ask gets bigger, so does the diligence.
Improper accounting means low or no funding. Ask yourself what investors will ask you:
- How long is your cash cycle?
- What's a customer's first-year value?
- Their lifetime value?
- Are you recognizing revenue properly?
If your books are properly managed, these are quick answers. If not, expect days or weeks of digging.
Investor-ready vs. functional financials. A growing business usually has functional financials, good enough to keep the doors open, but not necessarily efficient or accurate under scrutiny. Investors want audit-ready financials: revenue booked and recognized properly, all expenses captured, and owner/investor equity represented correctly.
This isn't hypothetical. See how one of our clients cleaned up its books and impressed outside investors after making this exact shift.
How much outsourcing do you actually need?
Outsourcing doesn't mean handing over everything at once. It tends to fall into a few levels, and the right one depends on your complexity and how much you want off your plate:
- Occasional expert guidance. You keep doing your own books but want an expert to answer questions or sanity-check your work.
- A guided partnership. A professional works alongside you rather than taking over, so you keep learning as the business grows.
- Full-service outsourcing. Bookkeeping, reconciliations, and reporting are handed off entirely, freeing your time for the business itself.
There's a useful parallel in how we think about sales tax outsourcing specifically: full outsourcing tends to make the most sense once a business is filing more than a handful of returns a month, or selling across multiple channels and states. The same complexity threshold applies to your broader accounting. Once you're juggling multiple sales channels, FBA or 3PL inventory, or the reporting headaches described above, that's usually the sign that guidance alone isn't enough anymore.
See what it looks like for one of our customers in this client success story video.
Frequently asked questions
What's the difference between an outsourced bookkeeper and an outsourced accountant?
A bookkeeper handles the recording and reconciling, keeping your books current weekly, monthly, quarterly, and yearly. An accountant builds on that with financial analysis, forecasting, and strategic decisions. Most growing brands eventually need both.
How do I know when it's time to outsource my ecommerce accounting?
If you're spending hours on bookkeeping or reconciliations instead of building the business, or can't quickly answer basic questions about your cash balance or margins, you've outgrown doing it yourself.
What should I look for when choosing an outsourced ecommerce accounting firm?
Scope of services, contractor vs. firm, CPA oversight, and real experience with your specific sales channels.
Can outsourced accounting really help me get funding?
Yes. Investors ask about cash cycle, customer lifetime value, and revenue recognition, and clean, audit-ready financials let you answer those questions quickly instead of scrambling.
Do I have to give up control of my finances if I outsource?
No. An outsourced team typically gives you better visibility than doing it yourself, since they can go deeper into your numbers while keeping you in the loop.
How LedgerGurus can help you
LedgerGurus is an ecommerce-specialized accounting firm with accountants and bookkeepers who know the peculiarities of ecommerce inside and out. Let us focus on your numbers while you focus on growing your business.
