11 Common Bookkeeping Mistakes E-commerce Businesses Make

Running an e-commerce business is exciting, but it also comes with a lot of challenges. Especially when it comes to managing your finances. Business owners often make common bookkeeping mistakes that lead to big problems. From tracking sales on multiple platforms to dealing with returns and currency conversions, things can get messy quickly

In fact, according to SCORE, poor financial management is the #1 reason why 80 percent of small businesses fail.

Don’t worry though, I’m here to help! In this guide, I’ll Walk you through the common bookkeeping mistakes e-commerce businesses make. I’ll give you the tools and tips you need to keep your finances clean and your business running smoothly.

Mistake #1: Not Integrating Your E-Commerce Platform with Your Accounting Software

Running an online store on Shopify, WooCommerce, or Amazon? If your sales data isn’t syncing automatically with your accounting software, you’re risking errors, wasted time, and unreliable financial reports.

The Problem:

Manually entering every sale into your books is tedious and error-prone. A missed transaction or misplaced decimal point can throw off your profit tracking, tax filings, and cash flow—costing you money and stress.

The Fix:

Integrate your store with your accounting software using A2X—the only tool we recommend for e-commerce automation. As an official A2X partner, we trust it to:

• Eliminate manual data entry with accurate, automatic syncs.
• Reconcile sales, fees, and taxes flawlessly.
• Save hours per week so you can focus on growth.

Why A2X? It’s built specifically for e-commerce, ensuring your books match your platforms—down to the last penny.

Need help setting it up?

As e-commerce accounting experts, Transcounts offers:

• Seamless A2X integration for Shopify, Amazon, and more.
• Canada & U.S.-friendly bookkeeping tailored for online sellers.
• Profit-boosting insights from clean, accurate books.

Get A2X + Expert Support →Let’s automate your books and scale your store—book a free consultation today!

Need a system? Use our DIY E-commerce Bookkeeping Checklist to stay organized. Download our free DIY Bookkeeping Checklist to avoid these mistakes monthly!

Mistake #2: Poor Reconciliation of Payment Gateways (e.g., Stripe, PayPal, Klarna)

When you sell products online, platforms like Stripe, PayPal and Klarna help you process payments. But these payment systems often take fees out before sending you the money. If you don’t check your records carefully, you might report the wrong income.

You might see a big sale of $100, but PayPal may only send you $95 after taking a fee. If you only track the $100, your numbers won’t match what’s actually in your account. This leads to errors in your bookkeeping.

Let’s say you’re a franchisee who sells through multiple stores. You may get different amounts deposited to your bank because of varying transaction fees. If you don’t compare your gross sales (the full amount customers paid) and your net deposits (the amount after fees), you could end up over-reporting your income.

To stay accurate, it’s important to reconcile your gross sales vs. net deposits regularly. This means checking that your bank deposits match the total sales minus any fees.

Here’s a good way to do this:

1. Check the gross sale (how much the customer paid).
2. Subtract the fees (like PayPal or Stripe charges).
3. Compare the result to the net deposit in your account.

Doing this will help you avoid ecommerce bookkeeping mistakes and keep your numbers clean.

Mistake #3: Ignoring Multi-Currency Sales and Foreign Exchange (FX) Adjustments

If you sell products to customers around the world, you might get paid in different currencies. For example, you might get paid in dollars, euros, pounds, or yen. This can cause problems with your bookkeeping if you don’t track it properly.

When you sell globally, the value of money can change. This is called foreign exchange (FX). If you don’t track these changes, you could lose money or report the wrong amount. For example, if you sell something in euros, but the exchange rate changes before you convert it into dollars, you might end up with either more or less than expected.

Let’s say you’re a franchisee with stores in both the U.S. and Europe. If you make a sale in euros, the amount you get in dollars can change based on the FX rate. If you don’t adjust for this, you might show higher income than you actually received, or vice versa.

To stay accurate, you need to track your FX gain or loss. This means checking how much you got in your local currency after the exchange and adjusting your records accordingly.

Here’s how to do it:

1. Track the sales in foreign currencies (note the amount your customer paid).
2. Check the exchange rate on the day you received the payment.
3. Convert the foreign currency to your local currency and adjust your books based on the new amount.

Behind on bookkeeping? Our Bookkeeping Catch Up in 30 Days guide helps you clean up records fast.

Mistake #4: Improper Handling of Returns, Refunds & Chargebacks

When customers return products, ask for refunds, or dispute charges, your bookkeeping can get messy if you don’t track these separately. It’s easy to forget, but it’s very important.

Here’s why: If you don’t track returns, refunds, and chargebacks properly, you might show too much revenue in your books. For example, you sell a product for $50, but the customer returns it. If you don’t record that return, your books will show you earned $50, even though you didn’t.

If you own a franchise and run several stores, it’s common for customers to return items. If you don’t adjust for returns in each store’s bookkeeping, you might think you sold more than you really did. This can lead to mistakes when it comes time to report profits.

When a return happens:

1. Record the return separately from your regular sales.
2. Adjust your inventory (take the item back into stock).
3. Recognize revenue correctly (reduce your revenue by the amount of the return).

Tracking returns, refunds, and chargebacks carefully helps you avoid ecommerce financial mistakes and ensures your reports are accurate.

Mistake #5: Using a Generic Chart of Accounts

When you set up your accounting, it’s easy to make the mistake of putting everything under one big category. For example, you might list all your sales under “sales” and all your expenses under “expenses.” This might seem simple, but it causes problems later.

Let’s say you own a franchise and sell online. If you lump all your sales together, you won’t know how much you earned from shipping fees or advertising costs. It’s like throwing everything into one big box. You won’t be able to figure out what’s what when you need to check your numbers.

As an e-commerce business, you need to track specific things, like platform fees, shipping income, or advertising costs. Each of these should have its own category. This way, you can see exactly where your money is coming from and going.

To fix this:

1. Create categories for specific items like shipping income, platform fees, and advertising.
2. Use specialized accounts for each type of sale or cost.
3. Customize your chart of accounts to fit your e-commerce needs. It doesn’t have to be hard. There are templates and guides to help.

By doing this, you’ll avoid ecommerce bookkeeping mistakes and have a clear picture of your finances.

Not sure how to customize your chart of accounts? Our team at Transcounts can set up your bookkeeping system from scratch. Learn more about our e-commerce bookkeeping services in Canada & USA and get the clarity you need.

Mistake #6: Failing to Track and Categorize Advertising Spend Properly

If you own an online store, and you spend money on ads, but don’t track where the money went, you won’t know which ads are helping you make sales. Imagine spending money on Facebook Ads but not being able to see if they helped you sell anything. You’ll be in the dark about your return on investment (ROI).

Why does this matter? If you want to know if your ads are working, you need to track each platform separately. By doing this, you can see which ads are doing well and which ones need improvement.

To fix this:

1. Track advertising spends by each platform for example, Facebook Ads, Google Ads, TikTok, etc.
2. Create separate categories for each type of advertising spend in your accounting system.
3. Align your bookkeeping with your ROI metrics.

By doing this, you’ll avoid ecommerce financial mistakes and spend your advertising money wisely.

Want to scale without chaos? Our 7 Proven E-commerce Growth Strategies includes inventory hacks.

Mistake #7: Not Accounting for Subscription or Recurring Revenue Correctly

If your business works with subscriptions or recurring payments (like monthly boxes or memberships), it’s easy to make a mistake when counting how much money you’ve made. Sometimes, businesses forget to track when the money actually comes in.

Let’s say you run an e-commerce store that sells monthly subscription boxes. Customers pay for a 3-month subscription up front. If you put all that money into your books at once, you might think you’ve earned more than you actually have. The payment isn’t fully earned until each month’s box is sent.

Why does timing matter? For businesses that rely on subscriptions, you need to account for income as it’s earned, not when the payment is made. This is called deferred revenue. It helps show your business’s true income.

To fix this:

1. Break down the payment (Record a portion of the subscription income each month).
2. Use accounting tools to track subscription-based revenue (tools like QuickBooks or Xero can help).
3. Set up a practice to account for income only when the service or product is delivered.

By handling subscription revenue this way, you’ll avoid ecommerce accounting errors and make your financial reports more accurate.

Mistake #8: Lack of Cash Flow Forecasting for Seasonal Trends

In e-commerce, sometimes of the year bring in more sales than others. For example, holiday seasons or special sales events like Black Friday can make your business boom. But if you don’t plan for these busy times, you might run into trouble.

If you own an online store selling clothes, you might see more sales around holidays. But if you don’t plan your cash flow well, you could run out of money to restock your inventory in time for the busy season.

Why is this important? Planning your cash flow helps you prepare for those busy times. It’s about understanding how much money you’ll have at different points and using historical data (past sales numbers) to predict future sales.

To fix this:

1. Use historical data from past seasons to predict future sales and cash flow.
2. Align inventory purchases with your available cash so you don’t run out of stock or overspend.
3. Create a cash flow forecast that shows when you will have extra cash to buy inventory or pay bills.

By doing this, you’ll avoid ecommerce financial mistakes and ensure your business is ready for any busy season.

Overwhelmed? Our 30-Day Bookkeeping Catch Up plan breaks tasks into manageable steps.

Mistake #9: Ignoring Key Metrics (COGS, CAC, LTV) in Bookkeeping

Many people think that bookkeeping is only for paying taxes or balancing the books at the end of the year. But it’s much more than that! Bookkeeping can help you make smart decisions about your business.

If you own an online store selling tech gadgets, tracking the right numbers like COGS (Cost of Goods Sold) and CAC (Customer Acquisition Cost) can tell you if you’re making enough money to cover what you spend on products and marketing. Ignoring these numbers can lead to bad decisions.

Let’s break down the key metrics:

• COGS (Cost of Goods Sold):This is how much it costs to make or buy the products you sell. If you don’t track it, you won’t know how much profit you’re really making.
• CAC (Customer Acquisition Cost): This is how much money you spend to get each customer. If you’re spending more than what customers are buying, your business could be losing money.
• LTV (Customer Lifetime Value): This tells you how much money a customer will bring to your business over time. Knowing this helps you decide how much to spend on getting new customers.

To fix this:

1. Make sure to separate COGS, CAC, and LTV in your accounting system.
2. Review these metrics regularly to help make smarter decisions about your products, marketing, and sales strategies.

By tracking these metrics, your ecommerce bookkeeping will help guide important business choices, rather than just dealing with taxes at the end of the year.

Mistake #10: Over Reliance on Manual Bookkeeping Instead of Automation

If you’re still entering numbers by hand, it might seem like a good way to stay on top of things. But manual bookkeeping can waste your time and lead to mistakes. The more you type things in manually, the more likely you are to make an error.

Imagine you’re running an online store and every time a new order comes in, you write down the sale in your spreadsheet. What if you miss one order or accidentally type in the wrong amount? That could mess up your entire financial picture.

Why is this a problem? Manually entering everything is slow and leaves room for mistakes. You can’t keep up with your business’s growth by relying on hand-written entries.

To fix this:

1. Use automation tools: Tools like A2X, Dext, and TaxJar can automatically sync your e-commerce sales with your accounting software, saving time and reducing errors.
2. Set up rule-based automation: You can tell these tools to automatically categorize certain types of transactions. For example, if you sell a product on Amazon, it can automatically assign the sale to the right category in your books.
3. Use software integrations: Connect your e-commerce platform (like Shopify, WooCommerce, or Amazon) directly to your accounting software to keep things smooth and accurate.

By moving from manual bookkeeping to automation, you’ll save time, reduce errors, and make your bookkeeping process much easier.

Track what matters! Our 10 Best Accounting KPIs ebook reveals the metrics that drive growth.

Mistake #11: Doing It Alone – No Professional Oversight

As an e-commerce business owner, you might think you can handle all the bookkeeping yourself. After all, it’s your business, right? But trying to do everything yourself can lead to mistakes, stress and confusion.

Let’s say you’re busy running your online store and keeping track of all the sales, returns and expenses. It can be overwhelming, and you might miss important details or make accounting mistakes. When that happens, it can hurt your business in the long run.

1. Know when to get help: If you’re getting lost in the numbers, it might be time to bring in a professional.
   1. Bookkeeper: A bookkeeper can help with day-to-day tasks like entering transactions and reconciling accounts.
   2. Accountant: An accountant can help with more complicated issues, like taxes and financial statements.
   3. CFO: If your business is growing quickly, a CFO (Chief Financial Officer) can help with long-term financial strategy and planning.
2. Benefits of regular audits: Having someone look at your books every few months (even if it’s just a bookkeeper) can help catch mistakes before they become big problems. Regular audits help keep things accurate and up to date.

By having a professional oversee your bookkeeping (even part-time), you can avoid costly mistakes, save time, and focus on growing your business.

Ready to stop stressing over your books? Let Transcounts help. We specialize in e-commerce bookkeeping, from Shopify to Amazon. Schedule your free bookkeeping strategy session now.

Get organized! Our Accounting House in Order guide simplifies tax prep year-round.

Conclusion:

In this article, we talked about common bookkeeping mistakes e-commerce businesses make, like not syncing your sales with accounting software or missing out on tracking returns properly.

I hope you now understand how accurate bookkeeping helps your business. It keeps things running smoothly, helps you get funding when you need it, and lets you grow without worrying about financial surprises.

Good bookkeeping isn’t just for taxes; it helps you make better decisions for your business. By avoiding these mistakes, you can keep your finances clear and your business on track, just like in other industries!

Remember, bookkeeping for online stores doesn’t have to be hard. With the right tools and a little care, you can make sure everything adds up!

Don’t let bookkeeping hold your business back. Transcounts is your trusted partner for e-commerce bookkeeping in Canada & USA and beyond. Book your free consultation today and take control of your finances.

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