A lot of entrepreneurs and investors consider accounting and bookkeeping in UAE for small businesses, including Amazon businesses, a huge headache. However, it is absolutely necessary. In order for you to grow your Amazon business, it is very crucial for you to have an excellent understanding of the business operations and performance.
When you choose to outsource accounting services and bookkeeping in UAE to third-party service providers, it is best to still understand how the task is done so you know what your accountant is talking about. You would also better understand the reports that are given to you by the expert.
Here are some of the accounting and bookkeeping information that you should know about to understand,
How the Amazon business you are running is doing:
Finding the right Experts to help with your needs and requirements
For an Amazon business in UAE, outsourcing offers the possibility of hiring an expert at a very affordable price but already with a high level of experience and expertise. A firm that offers accounting and bookkeeping services Dubai or anywhere in UAE can help you remain one of the players in the market that are competitive. Imagine having teams of accountants and bookkeepers working in one office all helping businesses like yours. A firm that provides accounting in UAE as a service will let you tap into their solutions and tools that are effective and efficient in maintaining your business’ books.
If possible, select the service provider that does not only give you reports but also help you monitor your inventory and track the Amazon business’ sales.
Tracking Business’ sales and profit
Tracking the cash flow of any business is very important, most especially in maintaining e-commerce or online business. You have to make yourself aware of the money that you are making and the fact that you are making more money compared to what you have invested. This won’t be possible at all if you are not in possession of reports and records that give a picture of the money that is coming into the business and going out.
Keeping the Receipts
Make sure that you have a system that helps you in organizing invoices and receipts. Documents such as these should be accessible easily. Work up a solid plan which will let you gain clear visibility on the storage of important business documents. You shouldn’t forget as well the creation of folders or labels for emails that are pertinent.
Monitoring the Inventory of the Business
Another thing which you have to track is the inventory of the business. This includes the goods that you are selling and the raw materials which are needed in producing your product. Money comes from the inventory of an Amazon business and whatever product that is sitting on the store or warehouse may spell possible losses. This is especially true if there is a sudden drop to the worth of the inventory.
You may want to know: When to Hire an Accountant for Your Amazon Business in UAE
Finding out the cost of goods that are sold
The cost of goods that are sold is just the total expense that is incurred by the business for each service or product that is sold. It will cover the number of inventory that was sold including the cost of the production for goods/services. An accounting or bookkeeping service in UAE will help you calculate the average cost for goods sold.
Calculating what’s needed for the Business to breakeven
As soon as you know the cost of services and products, you should also identify the other expenses for the businesses which are costing you. The expenses may be utilities, amortization for a loan, rent, insurance, as well as any other expense that is in relation to the operations of a business e.g. wages of employees.
These are fixed expenses. It is something that has to be paid every single month regardless of the volume of the sales that are made. Then, determine the number required for the business to breakeven. When the amount to breakeven can already cover costs for reduction and operations, then the business is doing great.
You should know: VAT Registration Guide for Amazon Companies in UAE
Monitoring sales and profits prior to paying Tax
Now that you’re aware of the cost of goods which are sold, as well as expenses that are considered as fixed, then it is time for you to learn exactly how to compute the Amazon’s business prior to tax dues payments. There’s a set of accounting rules related to revenue calculation. It’s recommended to leave this part to experts so you won’t have to expend energy that should have been focused on managing the Amazon business’ sales.
There are more things that you have to keep in mind with respect to accounting for Amazon business in UAE. If you want to know more, call us here in Farahat & Co today!