October 8, 2024 • 57 mins
Rachel Dauchy joins us to discuss some Niche Nuances with E-Commerce Clients. Rachel and Dan have created an E-Commerce Fundamentals course and this QB Power Hour unpacks the high level topics of this online course.
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QB Power Hour is a free, biweekly webinar series for accountants, ProAdvisors, CPAs, bookkeepers and QuickBooks consultants presented by Michelle Long, CPA and Dan DeLong who are very passionate about the industry, QuickBooks and apps that integrate with QuickBooks.
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Episode Transcript
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Dan DeLong (00:30):
Actually it's not Michelle and Dan today, quite a
different Segway going intotoday's QB power hour, but we
appreciate you joining us heretoday, Michelle is still on her
trip of a lifetime in Papua NewGuinea.
So joining us today, we havesome extra special guests but
today we'll be talking about ecommerce fundamentals and I
really had to look up how tospell intricacies of going
(00:54):
online because that is a toughword to spell off the top of
your head.
If you're not familiar with theintricacies of spelling.
Matthew Fulton (01:02):
Do you ever spell something so bad that even
spellcheck just doesn'tunderstand you?
Dan DeLong (01:08):
All the time.
Matthew Fulton (01:09):
Yeah.
Okay.
Thank you,
Dan DeLong (01:12):
That's a good, that's a good poll question.
of course, everybody knows whoMichelle is.
She's she's off gallivanting theworld doing her semi retirement
today.
Coho co-hosting today.
My name is Dan DeLong, owner ofDanwidth and School Bookkeeping.
Worked at Intuit today as well.
(01:33):
Workshop Wednesdays oddly enoughon Wednesdays and we'll pass it
over to Matt joining us todayfor a guest host
Matthew Fulton (01:43):
Hello everybody.
Matthew Fulton here with parkweb business solutions and qb
community live the facebookgroup Actually just want to use
my a couple quick seconds hereto do a big shout out and to
everybody in florida And theeast coast that's you know been
affected by all these differentstorms and the upcoming storms
so hope everybody's safe and
Dan DeLong (02:03):
Stay dry this this time.
And joining us for another time.
You've been on the Power Hourbefore, Rachel, but let's for
those that don't know Tell us alittle bit about yourself.
Rachel Dauchy (02:16):
Sure.
So I, like you said, also, I'm aco host with you with the
workshop Wednesday, which Ireally enjoy.
And I am just one of those folksthat really enjoy inventory.
So I, that's my backgroundbefore I came into the
QuickBooks world.
So I really fell into e commerceand retail, and now I'm doing a
lot of manufacturing andinventory setup and that kind of
(02:40):
thing.
So yeah, I do that.
Dan DeLong (02:42):
We appreciate you joining us and we'll actually
unpack a little bit about thespider web of industries that
you could actually get involvedwith with just e commerce in
general.
You can, you actually came fromthe inventory space
professionally before you becamea bookkeeper, right?
Rachel Dauchy (03:02):
Yep.
So I've always worked in goodsbased businesses, consumer
packaged goods and operationsand accounting.
And it's not, it's funny, it'snot necessarily one type of
industry.
It's really the way we do it.
Manage the inventory, theconnectivity, the automation, is
really what kind of we'retalking about when we're talking
(03:23):
about the e commerce specialty.
It's not necessarily just, itcan be a service business, it
could be digital downloads, itcould be all kinds of different
things that they're selling.
Dan DeLong (03:34):
Yeah, they definitely, there is no one size
fits all when it comes to thistype of industry.
So a little bit about the QBPower Hour every other Tuesday
the first QB power hour of themonth, which is this one is
eligible for TP and credit.
Thanks to our friends over atMakers Hub.
Ted is lurking in thebackground, making sure that we
(03:54):
fulfill our duties with pollquestions and making sure that
those certificates get emailedout post the work, the webinars.
We appreciate you joining us forthat.
You can always go to theqbpowerhour.
com slash resources.
Website for the PDFs of theslides, the recordings, the
podcast, and as well as otherresources.
A little bit of housekeeping, ifyou have specific questions
(04:17):
about topics that we're talkingabout today, please put them in
the Q& A, it makes it a loteasier to follow up and make
sure that we're addressing yourquestions.
As I see the webinar chat isscrolling by They tend to get
lost there, so it's really hardto manage that sort of thing,
but thank you to Matt joining ustoday, because he will do I see
(04:38):
he's typing already in there, sohe's helping out with that.
Rachel Dauchy (04:41):
Yeah, thank goodness for Matt.
I always say that.
Yes.
Dan DeLong (04:47):
And of course, we're we're simulcast or streaming on
the Facebook and social mediachannels.
If you are on the Facebook groupand want to participate please
use that QR code so that we cansee who you are when you when
you communicate or engage in theconversation.
We do have, of course, the KBPower Hour store to check things
out.
(05:07):
NRCP credit thanks again toMakers Hub for making that
available.
You get one hour.
You do have to participate,meaning that you have to answer
the poll questions.
And then we have a survey.
Post post webinar.
Our agenda today is we'll betalking about, and this all came
up about a year ago.
Rachel and I started a series ofa workshop on the workshop
(05:28):
Wednesday over at schoolbookkeeping about the nuances of
e commerce.
And and we're going to talkabout in real high level, just
what we talked and unpackedduring the, I don't know, what
was it, Rachel?
Was it it was like a couple.
A couple months of workshop thatwe really dug in there into the
conversations.
And
Rachel Dauchy (05:48):
we also like to talk about it a lot too.
So it's not that it's socomplicated.
We just love to chat about it.
Dan DeLong (05:55):
It was it was definitely a, an eye opening
discussion on both our parts,but we really want to talk about
really high level what wediscussed there and we've
created we've taken andrepurposed those those workshops
and turned them into an ecommerce fundamental course over
at School of Bookkeeping aswell.
Want to review all that thingsthat, a deeper dive that what
(06:16):
we're talking about here today.
We'll share those links at theend of the webinar, but really
we want to talk about, sellingonline in general shopping cart
versus a marketplace, what the,what that is inventory is going
to be specific typically it's aspecific nuance of this type of
industry and that as we're goingto unpack is really the, um,
(06:40):
when you're talking to a client,where the inventory source of
truth is really going todetermine a lot of other answer,
a lot of other questions thatyou might have when you're
working with them.
So typically they don't come toyou and say, here's my business.
Help me.
Or do they?
They
Rachel Dauchy (06:57):
do sometimes.
Matthew Fulton (06:59):
They come to you and say, here's my business,
help me.
But they don't say, here's allof my business, help me.
And oh, by the way, I forgot tomention these two other things
I'm going to add on next weekwhen you tell me not to do
anything and so forth.
Rachel Dauchy (07:13):
Exactly.
It usually comes in the form ofa surprise.
Dan DeLong (07:21):
And I'll add PayPal to all my sales channel.
And then there's always a salestax concern when it comes to
that.
We'll talk about those types ofconcerns omni channel selling
cause typically e commerce or a,a shopping cart as a gateway
drug.
Hey, they want to they want tosell other places as well.
Hey, if I can just do it here, Ican do it.
(07:42):
I can do it at Walmart or orAmazon or eBay or multiple
channels.
What's one more, right?
It's like when you have atriplet, um, what's one more
baby.
And then you get a surprise.
Yeah.
And then shipping andfulfillment will definitely be a
concern for e commerce salute ecommerce, the e commerce
(08:03):
industry.
And then we'll unpack some ofthe tech solutions that, that
will help streamline, hopefullythese processes, sales
connectors, the inventorymanagement system and then QBO
desktop synchronization.
And then if time permits, we'llhave some Q and A.
So our first poll question whilewe're Doing this, let's launch
(08:24):
that.
It's a two parter, right?
One, you need CPE credit fortoday's webinar, and two, you
currently have clients in the ecommerce space.
So Rachel, what really drove youto this state?
What made you get into this typeof industry?
Why would you do such a thing?
Rachel Dauchy (08:44):
First of all, I was very familiar with inventory
and inventory measurement andmovements, but I ended up when I
first started with QuickBooksonline and I've used all other
kinds of inventory softwares,my, whole professional career,
but I hadn't used QuickBooksonline.
I had used QuickBooks desktop.
And when I first started it, Iwas so clueless about QuickBooks
(09:07):
online that I thought I had toconnect everything to
automation.
I thought that was arequirement.
It's just funny how you justassume certain things.
I screwed it all up.
And so it took me a while tounravel it and figure it all
out.
So when I did that, I realized,oh, I can really service these e
commerce clients.
I just taught myself so manydifferent things.
(09:29):
And then I realized, oh, this issuch a great advantage because
even though I wasn't aninventory expert I know much
more now, but I thought, wow, Ican really use these few things
that I know.
And.
Just pick this niche And thenset myself apart from a lot of
other people and all you peopleon the call you might even hear
(09:50):
the same thing A lot ofbookkeepers and accountants will
say I don't touch inventory butif you equip yourself with a few
key fundamentals, you cancertainly do it and then not,
set yourself apart.
And now you're in a league ofyour own, and you don't really
have to compete with as manypeople.
So that was really important tome.
And that's really how myexperience has worked out.
(10:14):
So you
Dan DeLong (10:14):
had you had that knowledge, intimate knowledge of
inventory management, and thenjust
Rachel Dauchy (10:20):
Yeah, I did, but I also learned so much more as I
went along.
Of, okay, it's gotta work likethis, I gotta have a COGS entry,
okay.
Now that I discovered thisconnector is posting
transactions individually, thisconnector is posting
transactions.
Batched for the day.
(10:40):
How am I going to get my COGSentry?
Just figuring out so manydifferent things.
How is my COGS reporting goingto work in this situation?
You just learn so much as you goalong, almost inadvertently,
that it just works out that way.
Yeah, so
Dan DeLong (10:57):
you definitely don't go into this sort of industry
expecting to know everything.
Rachel Dauchy (11:03):
No, and you can't because you just don't.
A lot of these, what we're goingto get into, they, a lot of
these tech companies, SaaS,companies that sink into
QuickBooks do it differently.
That's why they're differentcompanies.
They don't all do it exactly thesame.
And I know Matt and Dan, youguys are so knowledgeable and
well connected with so manydifferent companies.
(11:25):
And so just the further that yougo along is now I have you just
learn how everybody does methink it does everything and how
these things are connected andhow it works.
But I will say, I'll just saythis because I think we're
probably going to get into this.
You don't have to be aninventory expert to do this kind
of e commerce bookkeeping andaccounting.
(11:46):
I get very involved in theinventory and help my clients
with the movement and housing oftheir inventory.
I personally don't get involvedin their shipping and
fulfillment.
That's something that they haveto take care of.
I am not involved in that atall.
I know other bookkeepers andaccountants that do not get
(12:07):
involved in where theirinventory is housed.
And they're just doing thebookkeeping.
And they're just, accounting forthe cogs and making sure
everything is timely.
It's really up to you.
There's no rules and that's whatI've learned along the way is
you just find, what you reallylike and what your inclination
is towards this type of thingand you can pick and choose and
(12:30):
I now am getting involved in,we'll talk about this a little
bit later, but an IMS, which iswhere you manage this inventory,
a cloud based IMS, the way thatit used to be done in QuickBooks
Desktop, but now we're doing itin a cloud based situation.
That's my jam.
So I don't, nobody has to do itthe way I do it.
There's a lot of different waysto get involved in it.
(12:53):
Yeah.
Dan DeLong (12:53):
Matthew, what do you, Where's your experience
from?
Is it more of you found a clientthat brought all this to your
attention or was it more of aspecialty for you to
Matthew Fulton (13:03):
found a couple clients over time that kind of
brought it to my attention andthen always being a button
pusher like that likes to try tobreak things and better
understand it.
I personally try to stay awayfrom having to track true
physical inventory where I canespecially within QuickBooks
(13:24):
online, because if it's a mess,it's a mess and which there's a
question actually from Carolyn,which I'm sure we'll get to
that's was asking about havingissues trying to upload
inventory for weekly batchupdate of thousands of items in
QBO.
I know some.
Apps that can externally do it,but I'm sure you may know other
items that can be done otherways.
But prefer to stay away fromsome quite a bit of the e
(13:45):
commerce stuff, but everything'se commerce now.
Dan DeLong (13:48):
Yeah, about four years ago Pretty much everybody
needed to at least have that ecommerce discussion.
Even people that met in personneeded to have some way to sell
something online that didn'trequire people to be in person.
No, we had we've, we've talked alot about this.
(14:08):
Type of topic in prior to bepower hour.
So I wanted to make sure that Ireally had the availability to
review those.
We did have Veronica Wasik onseveral years ago.
And she is one of those peoplethat Rachel was mentioning that.
Doesn't get involved
Rachel Dauchy (14:26):
with, that,
Dan DeLong (14:27):
That's her turn, her engagement is I'll live in the
QuickBooks and I'll get you setup, so that it comes into
QuickBooks in the way that Iwanted to, you do everything
else, and then they'll help ithelps her corral the cat, heard
the cats a little better whenyou have that, Framing in an
expectation setting.
(14:48):
So she has a great greatworkshop or QB power hour there.
We did have William English onto talk about his specialty of
retail when he was out in the onthe other side of the the Intuit
badge.
Now he's a QB assisted teamlead.
Funny how things work fullcircle.
We did have WebDuality on totalk about their solution.
(15:09):
And then I had a couple ofAmazon sellers that I was
working with do a paneldiscussion of what it's like to
work with that, that drunk uncleof selling, selling selling on
Amazon.
So you can always check thosecheck those out there.
They hold no punches of theirfeeling towards towards Amazon.
(15:30):
Oh, we don't want to start them.
Welcome everybody to another Oh!
Rachel Dauchy (15:33):
Oh boy, okay, see i'm not the only one dan.
Matthew Fulton (15:37):
Oh, wait Actually michelle told us we're
allowed to blame everything onher when she's not around
remember.
That's right.
I forgot about that
Dan DeLong (15:43):
So if you're considering specializing in e
commerce if we haven't scaredyou enough these are the things
that you're Potentially findyourself specializing in the
inventory management sellingonline Consulting and these are
things that you can Go down thatrabbit hole and and maybe find
yourself a home in like Rachelis finding inventory management
(16:07):
and those types of things to bereally where she, he finds her
passion regarding and all ofthese other things.
Maybe she's working withanother.
Partner, you know that canhandle those things.
So it comes in as a a team, youdon't have to wear all the hats
here
Rachel Dauchy (16:23):
Yeah, there is that situation going on for
sure.
Matthew Fulton (16:26):
Is this considered niching the niche or
niching the niche?
Dan DeLong (16:30):
Depends on what whether you're north of the
canadian border or not, I thinkthat's where the The
pronunciation we'll have to asksean at katana tomorrow when we
have him on the workshop What hesays But then there's eat online
selling consultant, right?
Like you could be specializingin setting up Shopify, from
(16:52):
start to finish marketplaceconsulting.
All right.
And, do you really want to dealwith Amazon?
You can get into those types ofservices, the retail aspect of e
commerce, right?
Do they have a brick and mortarstore in addition to selling on
then of course, that leads up tothe point of sale system.
What are they using to trackthose those sales?
(17:12):
And then of course, The 64, 000question of how that data gets
into QuickBooks.
And then of course
Rachel Dauchy (17:18):
Yeah, or do, can I even manage inventory in
QuickBooks with this situation?
Somebody that was, we were just,the chat maybe was saying
something about the thousands ofSKUs.
I would never do that inQuickBooks online, even if I was
only managing one channel.
So that should I do it here orshould I not do it here?
There is so much potential foradvisory.
(17:42):
This is my advisory.
I do this all day, every day.
Dan DeLong (17:47):
Yeah.
And then those retail channels,they're going to have
specialized service offeringsthat they might need, right?
Like the customer rewards,right?
Those types of things that theycould potentially be needing.
All of those things could be.
Be part of your technologicaladvisory services, if that's
what you want to specialize in,and then sales tax is going to
(18:10):
be a huge concern for somebodyselling online, especially if
they don't realize that they'vecrossed the economic nexus in a
certain state those things aregoing to necessarily be, uh,
that, that kind of someonelooking out for them, I think
is, that's probably the bestplace.
Matthew Fulton (18:29):
So this is one of the areas, yeah.
That I'm really interested tolearn a little bit more about
today as well.
And when I think of e commerceand a lot of people I'm helping.
Even just having communities andonline and selling subscriptions
of that nature It's e commercebecause as you're going to talk
about payment gateways versussales channels And you're when
(18:50):
you reach nexus in thesedifferent places so i'm excited
to hear a little bit more aboutsome of that stuff as we're all
building out these newcommunities for each other
Dan DeLong (19:00):
Yeah, and then, of course, shipping and
fulfillment.
So all of these could be, youcould be a generalist in just
this area, just one of theseareas or a, I'm sorry,
generalist in all of these areasor a specialist in just one of
these areas.
Lots of areas of places to, tofocus on.
Lots of rabbit holes to findyourself jumping down in this
(19:22):
particular area, right?
Let's first talk, talk aboutwhere you sell things, right?
Selling online you're gonna havesome options and and Rachel, we
had unpacked this whole idea ofa marketplace versus an online
shopping cart.
Rachel Dauchy (19:37):
This is something we address heavily in the course
in School of Bookkeeping.
Dan DeLong (19:43):
Yeah.
So talk a little bit about whata marketplace is versus versus
an online shopping cart, becausesimple thing is, Hey, I want to
sell stuff online, but thequestion is where and how, and
the.
Depending on where you do thosethings will determine a lot of
other workflows, right?
Rachel Dauchy (20:03):
Yeah, so one thing that we talked about
before is asking questions of anew potential client or even
somebody that you already haveas a client and maybe they're
looking to get into this.
Or maybe you have them as aclient and it's, Surprise! I do
this too! And that happens aswell.
There's always some corequestions you always want to
(20:24):
ask.
And if they're selling stuff,where are they selling that
stuff?
Or where do they want to sellthat stuff?
Some people sell that stuff inone retail store, where I'm just
taking on like a pack and shipstore.
And I'd consider that ecommerce, because they're
selling a whole bunch of stuffin their store, and we're
(20:47):
collecting those Those thatrevenue through a POS system.
So anyway, that and that we cantalk about a more later, but
basically it's where am Iselling this stuff?
If I'm selling it online or in astore, am I selling it on a
marketplace and a bymarketplace?
(21:07):
I mean something like Amazon anddad had a really good analogy to
this before.
It's basically like a swap meet.
It's not your swap meet.
It's a place that you go to andthere's a whole bunch of other
vendors.
So you're one of many, right?
So you're going to a place whereyou know there's going to be a
lot of buyers.
(21:28):
That's a marketplace.
So Amazon's a marketplace.
Etsy's a marketplace.
Walmart has a marketplace.
Walmart retail is not amarketplace.
But Walmart marketplaces.
And then there's a whole bunchof other e com marketplaces out
there.
And the main commonality thatthey all have is that they're
(21:51):
what is called a marketplacefacilitator.
Meaning, they collect the salestax from your buyer, they then
remit that sales tax to thestate, and they also file the
return.
That is an advantage of goingwith somebody like Amazon or
eBay or another kind ofmarketplace.
(22:13):
You still have to record thesales tax coming in the sales
tax going out, but you are notaccruing a sales tax liability.
That is the most importantthing.
That's enticing to peoplebecause they don't want to deal
with sales tax.
And I get it.
Sales tax sucks.
So they'll often be willing topay the high fees of something
(22:38):
like a marketplace.
The other option would be a,what'd you call it?
Like your own, whatever.
Yard
Dan DeLong (22:46):
sale.
Yeah,
Rachel Dauchy (22:49):
so your own website would be something like
Shopify or WooCommerce orsomething like that where it's
your own business likejoeshardwarestore.
com.
It's your own domain and you areresponsible for the traffic of
getting people to your website.
You also have to collect thesales tax and then you have to
(23:12):
remit the sales tax.
And because it's online, ifyou're in an online store,
people could be buying fromanywhere.
And so that collects what wecall economic nexus.
That's all I'm going to sayabout that.
We have a course on that in theworkshop, but in school
bookkeeping.
But the other piece of thatwould be if you have your own
(23:33):
retail store, your own salon oryour own, whatever.
where you're collecting your ownpayments and then you're
obligated to pay your own salestax.
I lump that under e commercebecause I'm usually taking some
kind of electronic POS payouts.
And so again, and Matt, youprobably know all about this.
(23:55):
This is something that is alsoneeds to be synced to QuickBooks
Online.
To post the revenue, becauseI'll ask you guys one question.
We talk about this all the timein this course.
Do we post payouts to revenue?
No, never ever.
(24:18):
So in quick, now here's thebeauty with QuickBooks online.
This is all sinking intoQuickBooks online.
You bookkeepers out there.
What posts revenue?
A sales receipt, an invoice, ora journal entry.
So that's how the revenue comesin.
The payouts can sometimes comein two days, three days, two
(24:41):
weeks later.
It really depends.
So that all these are things toknow about but the main question
is find out from your potentialclient or your client where they
are selling and again you can bea expert get some information on
the fees involved in either andposition yourself to be an
(25:06):
expert and hey you might want toconsider something like amazon
yeah the fees are high but lookat the the advertising potential
you can get from that.
Or don't do that.
Maybe go the Shopify route.
Maybe you're a Google SEOspecialist and you have some
insight into that and can helpyour client, navigate that
(25:27):
world.
And I don't know anything aboutthat.
So that's where I would reachout to somebody like Matt, who's
an SEO expert.
Matthew Fulton (25:34):
Probably Dan It's better.
But can I try to summarize tomake sure I heard?
Rachel Dauchy (25:39):
Yeah
Matthew Fulton (25:39):
a big difference between it being it's like a
marketplace What you're tellingus is it's important for us to
talk to the client to number oneunderstand where they are
selling everything and then toYou also need to know how you
get paid for everything yousold.
Rachel Dauchy (25:56):
Yes,
Matthew Fulton (25:57):
because depending on how you get paid if
it's going through a saleschannel where you're selecting
it through Authorized.
net or any of these otherdifferent ones that are paypal
which Dan and I were jokingpaypal is the only six letter
four letter word out there.
Yeah
Rachel Dauchy (26:15):
There's a million and one different ways to
collect that money You
Matthew Fulton (26:20):
Yep.
And so when you have thatcontrol, that's talking about
the shopping cart.
And then the shopping cart hasto have a really good
understanding of sales tax,pinpoint rooftop type stuff that
to save your rear down thefuture.
Rachel Dauchy (26:33):
Yeah.
And then there's also, and I,maybe we'll get into this a
little bit later, but there'sall kinds of automated sales tax
apps.
That I'm looking a lot intonumeral right now that will
track that nexus.
And so it'll determine, that's awhole separate webinar that we
could do about what achievesnexus.
But there's a lot of resourcesonline about that.
(26:55):
That's something that's reallyimportant to know.
But it, software can do it foryou.
Dan DeLong (27:01):
And the big thing is there's pros and cons to either,
either route, right?
So you're in, in, in what youhad mentioned about the
marketplace is you're going tohave sales tax calculated by
them.
They're going to be handling thecustomer service and of most of
these sale and then on the.
Individual online shopping cart,Shopify being, an example of
(27:22):
one, all of the end to end,you're going to own that, right?
So another analogy I would sayis if you're a farmer, you can
set up a farm, stand on the sideof the road and you have control
of everything.
From customers coming in, howthose things are fulfilled and
everything.
Or you take all your goods overto a farmer's market.
Rachel Dauchy (27:43):
Yeah.
And
Dan DeLong (27:44):
that will have, foot traffic already built in because
people know that there's afarmer's market Yeah.
And such a dick larger
Rachel Dauchy (27:50):
audience.
Yeah.
And by the way, Shopify, and I'ma Shopify partner.
Shopify by far in my opinion, isthe best they actually have.
I don't know most of the marketshare, not most, a significant
number, I used to know it offthe top of my head, of all
online sales.
And I think last year they wereresponsible for 65 billion worth
(28:11):
of online sales.
They're by the way, Shopifypayments is a payment method
powered by Stripe.
It has the most powerfulshopping cart.
Most integrated, most integrateability.
Is that a word?
Yeah.
Integratable of all the peoplein the QuickBooks ecosphere that
(28:32):
are building apps to get datainto QuickBooks.
Shopify is by far the best.
Dan DeLong (28:40):
But you can certainly find yourself into
those rabbit holes of what appsand add ons
Rachel Dauchy (28:45):
in
Dan DeLong (28:46):
the Shopify space.
But the next biggest thing, andthis is probably the biggest key
factor to determine when you'retaking on an e commerce client,
is inventory management.
Rachel Dauchy (28:58):
Yeah,
Dan DeLong (28:58):
determining where that source of truth is it going
to be in the online saleschannel?
Is it going to be in QuickBooksor is there something that's
necessary in between the onlinesales channel and QuickBooks to
manage that inventory?
Because that's going to reallydictate the workflow, the
purchasing, receiving sales taxAnd your sales tax I'm sorry,
your technology solutionsRachel, what are you what are
(29:21):
your thoughts about that?
Rachel Dauchy (29:22):
Yeah.
So as, so the first importantquestion, like I said, was
determining where are theyselling?
The next important thing todetermine is.
Where is my inventory going tolive?
But before you ask thatquestion, you have to know, and
this is where a lot of peopleare very confused and clients
(29:43):
are very confused.
And it's this, are they dropshipping or are they carrying an
inventory?
Meaning are they buying goodsthat they're either storing in
their garage, in a warehouse, Ina fleet of warehouses and are
(30:04):
they shipping out their ownstuff?
That is extremely importantbecause a lot of people come to
me as dropshippers, they don'tunderstand that they're even
dropshipping.
And what that means is, they'renot holding an inventory, they
are Facilitating, they'regetting the inventory that's
over here with some otherprovider and they're making the
(30:26):
sale and that provider isshipping it.
So they're not actually buyingthe inventory, recording the
sale and putting it to inventoryand then recording a cost of
goods sold entry at the point ofsale.
That's not happening.
So if they're drop shipping,they're not holding any kind of
(30:46):
inventory and it's actuallyquite simple.
And we talk about that in theschool of bookkeeping.
If they are buying goods foreither resale or.
Sorry, if they're buying goodsfor resale, then they're holding
an inventory.
Then it shoots off into, am Iholding the inventory on the
(31:07):
balance sheet?
Or am I actually just hittingcost of goods sold right away
with this inventory?
That hitting the cost of goodssold right away with the
inventory, isn't my preferredway to do it.
It's the easy way, and it's not,it could cause them to be upside
down on their P& L.
We'll talk about that anothertime, but that is the most
(31:29):
important question to know.
Aside from, am I dropshipping?
Am I not dropshipping?
That requires some reallylistening to them to understand.
But if they are fulfilling theirown stuff, then we have to
determine, Can I manage that inQuickBooks?
(31:50):
The most important thing out ofthis whole other question
besides what are they selling?
And this is crucial.
If they are buying rawmaterials, assembling those raw
materials into a finished good,and selling it, automatically no
QuickBooks Online.
They cannot do it.
(32:11):
Now, if they're buying stuff,putting it in their garage,
warehouse, or any otherfulfillment house, and it's just
reselling it, they can do it inQuickBooks Online.
And let's say, for example, andI'm going to keep it really
simple.
Let's say, They're a wholesalerand they're, so no sales tax.
So they're buying goods, let'ssay from China, finished goods.
(32:34):
They're putting it in awarehouse and then they are
selling to a wholesaler, sendingthem an invoice.
Let's say not even doing an, anykind of e commerce thing.
They're just wholesaling.
They can then manage those itemsin QuickBooks online.
100 percent I would even say ifthey've got thousands of SKUs,
(32:56):
they can do it in QuickBooksonline.
Because they're setting thatinventory up to when the
purchasing is made goes intoinventory and then when they
sell it with an invoice, itdecreases the inventory and hits
cost of goods sold.
So that's an example of can I doit in QuickBooks or can I not do
(33:17):
it in QuickBooks?
So Dan, you have a whole bunchof other of why can't I do it in
QuickBooks.
So why don't you give an exampleof that?
Dan DeLong (33:26):
Yeah.
So we so yeah, so we've we'veunpacked this and this is one of
those rabbit holes that we endedup going down in managing the
inventory.
So we've created a separatecourse for managing inventory.
Can you do it in QuickBooksonline?
I I wrote a blog on the firm ofthe future of what you can do,
but really those three thingswhat you mentioned there is if
(33:48):
they're reselling, I buy stuffand I sell that same stuff.
I've got maybe some periodicinventory that I want to keep
track of but I don't do anythingfancy, right?
So I don't.
I don't need to track like Ihave a a client who's a
distributor of alcohol and thetax even Napa Valley, so it's
wine and tequila.
I don't know why they go fromone end of the spectrum to the
(34:11):
other, but Carol, California, hebuys in a, Base unit of measure
of a bottle, but he's got totell the state how many gallons
he has at a certain, at the endof the year, because the fact
man wants to know how manygallons that is.
So we have to convert that to toa volume discount, so to speak
(34:33):
to do that, and that's notsomething you're going to get
out of QuickBooks online.
You're going to need some kindof third party application in
order to get those same reports.
Rachel Dauchy (34:43):
Yeah, so and then so let me just give like a
really quick little examplebecause somebody just asked
inventory can be tracked inQuickBooks Enterprise.
It's not really an issue of canI track it or can I not track
it?
It's a matter of the complexitythat can be involved.
So so again, like this pollquestion that Dan's asking, do
(35:05):
you recommend tracking inventoryin QuickBooks?
Yes.
Certain situations, yes, andI'll give you a perfect example
of a client of mine that we dotrack it with a periodic
inventory, okay?
This is a retail store.
They sell very expensive musicalinstruments and a very low
volume of it, okay?
(35:26):
This is a very ideal situationfor a periodic inventory.
In the store, they collect theirpayments through Stripe, right?
The invoices come in, but withthose invoices, we don't have a
COGS entry.
All it's doing is justcollecting revenue, right?
Revenue payment.
That's it.
At six month mark, we count theinventory, and at that point,
(35:51):
decrease inventory, increaseCOGS.
That's it, end of story.
But we can track the ins andouts with of the sales with
QuickBooks Online, which isreally nice, but that inventory
just stays put, right?
So now a perpetual inventory,the same thing, let's just say
(36:13):
like I have the other clientwith that we're going to onboard
with the, box store, right?
The where they're selling, Idon't know, tape and boxes and
staplers and mailers and stuff.
Those can all go into QuickBooksOnline as inventory items, if
you're using Plus or Advanced.
And we can, when we make thosepurchases, increase the value or
(36:38):
increase the quantities ofthose, use that reporting in
QuickBooks Online.
It's only one channel.
It's just one store.
And then they're, they'reinvoicing from QuickBooks
Online, the inventory goes down,hits cost of goods sold right
away.
The reason that we would need anexternal hub for inventory is
(36:59):
because we would need acomplexity of something like we
do in QuickBooks Enterprise,where we're multi channel or,
all kinds of differentcomplexity.
And now the advantage of thatversus doing it in QuickBooks
Enterprise, it's cloud based,and I can sink in all kinds of
other stuff, and I can usereporting tools, and my client
(37:22):
can be cloud based, and I can becloud based, and that's where
somebody like Matt can jump onthis because he's an expert on
all this cloud software and youdon't have to remote into your
client's desktop enterprisecomputer, which is not for me.
That slows down my business.
I can't really scale like if I'musing one provider like sin
(37:45):
seven, like I can scale a lotbetter because I have everybody
Feeding the data into qbo andi'm using something like since 7
where everybody goes on it.
I use katana, too But for me asa firm owner, I don't have to
spend all this time going intosomebody's desktop computer So
just wanted to address thatreally quick.
Matthew Fulton (38:05):
Are you familiar with fishbowl?
Rachel Dauchy (38:07):
Yeah, I do but fishbowl is also a desktop
software that you would have toremote into They do have a cloud
based solution right now, but itcan't really do much, and it
also can't be multi channel.
The last time I talked to them,They told me that, but that
might have changed by now.
I can't be on a cloud based IMSthat can only manage one
(38:28):
channel.
Something like SYN7 to me isperfect.
You can dropship.
You can also do holding aninventory.
Something like Katana, youcannot drop ship.
So it's a total workaround.
There's just differentadvantages to other, to, to
different cloud based
Matthew Fulton (38:44):
IMSs.
Part of the reason I was askingjust real quick was Kate had
asked in the questions aboutspecific about Fishbowl and
fulfillment.
Can COGS all be managed inFishbowl?
Yes, it can.
Yeah.
And so
Rachel Dauchy (38:57):
The advantage of using an IMS.
Is that the invoicing can go, isgoing from that platform and it
just syncs all to QBO.
And hey, guess what?
If you don't want it to syncthat way, you can bypass it with
a connector like Cinder orBookkeep or PayTracker or
whatever.
And then you can pull your COGSmonthly from the IMS, post them
(39:21):
to QuickBooks.
And actually I'm training aclient to do that later today.
I'm working in Katana with them.
And we actually bypass we postthe revenue with Cinder.
But because we don't want to bebeholden to updating the cogs in
Shopify all the time, we wantthem from the IMS.
We're going to pull them fromthat and post them manually to
(39:42):
QuickBooks Online.
There's all kinds of differentways you can be creative and do
it.
And it really is based on theirneeds.
Dan DeLong (39:51):
Absolutely.
So yeah, we can definitelyprobably spend the entire work
power hour talking about yourfavorite topic.
Yeah, for sure.
And like
Rachel Dauchy (40:01):
somebody is saying, yes, you can do it in
QuickBooks Enterprise, but Ijumped onto QBO five years ago
from, complex situations likeSAP.
I like the cloud Setup and sofor me, all I do is get
notifications all day long abouthow quick enterprise is No, no
(40:22):
longer supported or I don't knowwhat, but or maybe it's the pro
and premier that are no longerbeing sold.
And I don't know how longenterprise is going to be
supported.
If they're going to be doingupdates, I don't know.
And my business, I'm building itto, to scale and also to be a
longterm business.
I don't want to.
(40:42):
I don't want to get myselfinvolved in something that may
be going away.
Dan DeLong (40:47):
Yeah, you just end up finding yourself a new
solution in, or having thisconversation, a little bit down
the road.
Rachel Dauchy (40:54):
Yeah.
Dan DeLong (40:54):
I'm reminded of several political policies that
do the same thing, where theyjust, oh, we'll just, Increase
the debt ceiling.
Rachel Dauchy (41:01):
Yeah.
Dan DeLong (41:02):
Speaking of government policies, we've got
sales tax considerations, whichwe had a really nice series with
Avalara.
They are probably the goldstandard of of sales tax
collecting remittance services.
There are others that are outthere but we're really unpack
more things, that reallyinvolve.
With sales tax, what do I sell?
(41:23):
What kind of products do Iactually sell?
Is it services?
Is it hard goods?
Where do I sell it?
Which un unlocks this.
Specific topic of nexus and isreally concerning or a concern
for a for an e commerce sellerselling across the lines of
whether it's a physical nexus oran economic nexus who do I sell
(41:44):
it to, right?
Maybe they're wholesalers andthey have a resell sales tax.
Um, or a reseller certificate.
That's the word I was lookingfor where they don't get charged
sales tax.
And then there's this otheroption of when do I sell it?
Maybe it's during a sales taxholiday or something like that.
So all of those things fall intothis.
(42:05):
Then diagram of, is itcollecting sales tax?
And then it's the amount of whatdo I have to collect?
Is it a luxury item or food andbeverage?
The category of the item, allthose go into that.
In the essence of time, there'slinks there for the, for those
workshops.
You can get free access to theseworkshops and all the other
workshops that we do at Schoolof Bookkeeping.
(42:26):
Those links are there in theslides.
Shipping and fulfillment isanother Workflow concern do they
do that themselves or we talkabout this idea of a 3PL with
Unpack that for us Rachel.
Rachel Dauchy (42:41):
That means a third party logistics.
So that's basically is somebodyelse housing and fulfilling
their inventory for them andOftentimes they'll arrange their
shipping for them as well.
And
Dan DeLong (42:55):
You mentioned dropshipping before.
Rachel Dauchy (42:57):
Yeah.
Would
Dan DeLong (42:57):
a 3PL be considered a dropshipper if they are doing
the selling?
Rachel Dauchy (43:02):
That's a really good question.
I don't know if that'stechnically considered
dropshipping because I thinkThat is still, if it lives in
the 3PL, it's still technicallyyour inventory.
No, I would say no.
If it's on somebody else'sbalance sheet, that's
technically dropshipping.
I'm just grabbing that sale andthen I'm accounting for the cost
(43:26):
of goods sold at that time.
That's usually how dropshippersdo it.
It's not any kind of periodic orperpetual inventory.
But yeah, so a 3PL is basicallywhen you get large enough, you
want to house and ship yourinventory.
I used to work for a bottlingfacility and we used to have
(43:46):
3PLs in California, Texas andNew York because obviously that
cuts down on the shipping acrossthe country.
And so the order, depending onthe ship address gets routed to
whatever 3PL and then it shipsfrom there.
Now there's all kinds ofintegrated software that you,
cloud based software that youcan use for that like
(44:09):
ShipStation.
And that can be integrated intoyour IMS.
So it knows where, when exactlyit shipped.
So that is actually accountingfor the sale date.
And so there's no confusionabout that.
So it's um, I'm really a big fanof, like I said before, cloud
(44:30):
based everything, everything'sset up on automation.
So that way it's running in realtime, very smoothly.
And yeah, it takes a bit of timeto really understand all these
different moving pieces, but theaccounting behind it is not that
difficult.
And if you really, justunderstand this basic okay, I'm
(44:53):
buying goods and I'm puttingthem into inventory and I'm
really only going to account forthe cost.
When the item is sold, then yoursale posting is also going to
have a COGS entry.
And by the way, if you'retracking inventory in QuickBooks
Online, that QuickBooks invoicealso has a COGS entry when you
(45:19):
have inventory turned on.
If you are managing inventory inQuickBooks and anybody on this
call, you're And you are doingit and it's working great and
they have a simple enoughsituation.
Look at one of those invoices,look at the transaction journal
and you'll see that COGS entrythat's posting along with it.
(45:39):
It's really cool to understandthe movements that are happening
and you're recognizing that costof goods sold on a true accrual
basis, which is going to giveyou that P and L on an accrual
basis, but you really need totrack your cogs in the period
(46:00):
that the item was sold.
Because if you're buying allyour inventory up front.
In the beginning of one year,and then let's say you're slow
all year, and then you selleverything the following year
you want to make sure thatyou're recognizing the cost of
goods sold in the time that it'ssold, and that's really
important for businessintelligence.
(46:20):
If you're just, hitting cogsright away with all your
purchases.
It's the quick and dirty easyway to do it, but I know people
that have done it that way.
Again, it just really depends onwhat they're selling and maybe
is the stuff low cost and theyjust expense it right away and
it's not really that big of adeal.
It really just, like Dan and Ialways say, it just really
depends.
It just, Take a look at whatthey're selling, look it up
(46:44):
online, do some research, lookat, there's all kinds of
inventory accounting resourcesout there.
What you know I was just tryingto think of that one like
accounting Whatever 101 thing tolook up and look like what does
cogs mean?
Just all these different thingsand you can get some information
on that
Dan DeLong (47:03):
And just to touch loop back to shipping there is
an option in quickbooks to beable to print your own shipping
labels in inside of quickbooksonline, but If you're not
managing the sale in quickbooksonline You're not going to be
able to do that.
So that's again, talking aboutthe The priority of where is
(47:24):
your inventory going to beliving?
And that's where you're going tobe doing all of the other
workflows.
That's
Rachel Dauchy (47:30):
yeah and that's really important to know because
I and i've talked to a lot ofdifferent providers about this
And when my situation I usequickbooks to collect the data
not necessarily do the stuff.
I do the stuff You outside ofQuickBooks, I then bring the
(47:52):
data into QuickBooks.
So I have a consolidatedfinancial statement, right?
So for people that are used todoing all the stuff in
QuickBooks online, it might feela little weird, that's what I'm
saying is you can bring thatsale into QuickBooks, have your
sale, and then create a shippinglabel.
It's really At this point, Ipick and choose what do I want
(48:14):
to do in QBO and or do I want todo anything in QBO?
Do I just want to leave it as abucket and just dump all the
data in it?
It's just, there's a lot offlexibility now of how do I want
to do this?
And it's really cool becauseyou're not just, you don't have
to do it a certain way, which isthe way I thought when I first
(48:36):
came into it, I thought I had todo it this way.
The cloud gods were up theresaying, you have to do it this
way.
Otherwise you're going to bepenalized.
And as long as you're following,the What, accounting rules,
whatever, there's all kinds ofdifferent solutions that you can
stumble onto and perfect.
It's really neat.
Dan DeLong (48:58):
So we want to make sure that we cover, at least
gloss over the rest of thetopics here.
So multi channel filling, thisis like an omni channel where
you're selling online a multipleoutlet, where you've got this
hybrid of selling in Shopify andAmazon, it's exponentially more
(49:19):
complex as the image here here'sthe father, the expectant's
father, he was expecting onebaby, oh, now there's three at
at the same time various paymentmethods across all of those
sales channels, multi currencyif they're selling in
internationally, and thenthere's that four letter word
of, PayPal.
(49:41):
And then all of that boils downto how do I get my sales data
into QuickBooks?
We have these a variety of salesconnectors that we call them or
bridges.
We're not quite sure exactlywhat the terminology of it all
is.
But we had we integrate on, wetalk about.
Comparison of Webgility versusVendor and then there's Bookkeep
(50:01):
and A2X that do summarizetransactions.
All of those things are unpackedin, in that as well.
And then, Oh, there's this otherthing.
QuickBooks has its ownconnection.
What about that, right?
There's one thing that, youseamlessly connect your sales
channels, there's there's a fewyeah, buts.
You can't use inventory whenyou're using these sales channel
(50:23):
connectors in the commercesection of QuickBooks online.
You've got a limited.
Amount of sales channels tochoose from and those sales post
on payout.
So if you,
Rachel Dauchy (50:36):
I think they created that just so they can
say that they have it.
I don't use those.
Natia, have
Dan DeLong (50:41):
you have you gone down this rabbit hole inside of
QuickBooks Online?
No,
Matthew Fulton (50:46):
my I would not, no, it's not worth doing that.
It's getting on into a darktunnel with the sound of a train
coming and the train doesn'thave a light on because you
already know that you're goingto get hit by something.
Pay at the thing I want to addon is paypal.
There should be no comminglingof paypal ever if you're going
to use paypal like
Rachel Dauchy (51:05):
Such a good point,
Matthew Fulton (51:05):
right?
if you really have to do it setup different paypal accounts for
other personal stuff, but
Dan DeLong (51:14):
So we we talk about the there's one size fits all
Doesn't fit all like for all ofyour sales connector needs,
right?
Maybe you have a client who'sonly in Shopify and they want
that detail inside of QuickBooksreintegrate is actually a really
good solution for them.
Their price point issignificantly less than
something like a Cinder orWebGility if they're only using
(51:35):
Shopify if you're not needingthe sales detail, Bookkeep is a
fantastic place to Salesconnector to bring in those and
split the sale versus the payoutand reconcile those two So we
talk about the pros and cons ofeach one
Matthew Fulton (51:51):
one thing i'm
Dan DeLong (51:51):
working
Matthew Fulton (51:52):
Go ahead one thing on this real quickly when
you're able to use a softwarethat's going to do either sales
receiver or an invoice You canactually take advantage of
bundles and you can bundlethings in and get more metrics
from reporting as a sneaky way.
And you can't do that whenjournal entries are being used.
Just food for thought.
Rachel Dauchy (52:13):
Yeah.
And just to also say, Cinderdoes either journal entries or
sales transactions.
And with the sales transactions,you can do either sales receipt
or invoice.
Dan DeLong (52:27):
We'll launch the last poll question as we're
talking through the last lastthing here.
Obviously, this is just touchingon the surface of some of these
topics and it, and they do getinto the weeds really quickly as
we've as we've been able tounpack just in, in this hour.
So we've unpacked those,expanded them, made them easier
(52:48):
to consume.
We tried to take each topic.
And turn it into at most fiveminutes, a five minute
discussion.
You can go into these coursesand these lessons, ask questions
in the comments.
We'll answer them.
There is a community in, inthere outside of the social
media spectrum where you can askmore specific questions as well.
(53:10):
And then there's options ofmentorship.
Hey I want to.
Go right in, I've got thisclient and I need to, I need
some help sorting through someof these things.
We've got that there as well.
And you'll also have access tothat managing inventory course
as well.
We have a 30 day free trialneeds a promo code, a work,
you'd be power, our users, allthat great stuff there.
(53:31):
Yeah.
And I'm a member of that
Rachel Dauchy (53:34):
school of bookkeeping community too.
And I've gotten more involved inthe community and answering
questions and stuff.
So it's really cool.
Dan DeLong (53:42):
All right, so we did launch the poll question there
and it looks like a lot ofpeople got some good information
here.
I did want to answer onequestion live and I flagged it.
Where did it go?
The question was
Matthew Fulton (53:54):
by Wayne, who said, My client primarily sells
via website, but he has addedmarketplaces like Amazon.
Shopify has a process to managethe marketplace within Shopify.
So is it good to let Shopifymanage this, or is there an app
that should be in the middleinstead?
Dan DeLong (54:09):
Yeah.
That's that's a it's dependsanswer, right?
Because bringing that into intoshop in those Amazon sales into
Shopify.
The question is what's going tohappen with the payout regarding
his Amazon sales?
Because as we.
As you understand with Amazon,the payout is significantly
(54:30):
delayed when it comes to that,that particular marketplace.
And of course they throw out allthe fees.
The storage fees, the I lookedat this transaction fee.
I I made this be so complicated.
You don't argue when you contactAmazon seller central.
All of those fees are thrown inthere and those come two weeks
(54:51):
later.
And Oh, and then you also haverefunds and returns and all of
those things.
That is probably not going to beas detail oriented by bringing
that sale into Shopify.
And then trying to reconcilethat sale to the payout is going
to be significantly harder byjust bringing the sale into the
(55:12):
Shopify Ecosystem and thenbringing that into into
QuickBooks.
That's going to be a complicatedanswer.
You probably want to keep thosethings separate and keep those
things and clearing with aseparate clearing account.
I
Rachel Dauchy (55:27):
know Amazon has the ability to do that now,
bring it into Shopify.
So then you can manage yourinventory within Shopify using
something like Stocky.
I would use an IMS over that.
Dan DeLong (55:38):
Especially when you have that additional
complication of multiple saleschannels.
Keeping those separate and maybein something else.
And other people were using,Fishbowl as a route to do that.
Keeping those outside of that.
So we appreciate you all joiningus here today.
We did talk a lot about some ofthe specific nuances of E
(55:59):
commerce Rachel, appreciate youjoining us today.
You're a wealth of knowledge inthis area and Matthew I
appreciate you and your insightsas well.
Any closing thoughts Matthew onwhat we talked about today?
Matthew Fulton (56:12):
No, I have, it's fun being up here and still
actually being in listening andlearning mode.
It's why I still attend thesemyself all the time.
There's so much that I canlearn.
And I learned about Dan's uncle.
Dan DeLong (56:24):
Yeah, that's the uncle that always shows up at
the holiday dinner.
You're not quite sure what'sgoing to happen with Amazon,
it's probably, you're notprobably going to like it.
All right.
So we will see you all next timeon the QB power hour.
And if you're so inclined tojoin us tomorrow on the workshop
Wednesday, we'll talk more withRachel.
Then with, we're actuallycomparing QuickBooks enterprise,
(56:46):
the desktop enterprise to acloud based solution of Katana.
So join us tomorrow.
Rachel Dauchy (56:52):
So much more things now that they used to
have.
Matthew Fulton (56:56):
And
Dan DeLong (56:57):
thank you to
Matthew Fulton (56:57):
Makers Hub also, right?
Dan DeLong (56:59):
Yes, absolutely.
And we'll see you next time onthe QB Power.
Everybody have a great day.
Actually it's not Michelle and Dan today, quite a
different Segway going intotoday's QB power hour, but we
appreciate you joining us heretoday, Michelle is still on her
trip of a lifetime in Papua NewGuinea.
So joining us today, we havesome extra special guests but
today we'll be talking about ecommerce fundamentals and I
really had to look up how tospell intricacies of going
(00:54):
online because that is a toughword to spell off the top of
your head.
If you're not familiar with theintricacies of spelling.
Matthew Fulton (01:02):
Do you ever spell something so bad that even
spellcheck just doesn'tunderstand you?
Dan DeLong (01:08):
All the time.
Matthew Fulton (01:09):
Yeah.
Okay.
Thank you,
Dan DeLong (01:12):
That's a good, that's a good poll question.
of course, everybody knows whoMichelle is.
She's she's off gallivanting theworld doing her semi retirement
today.
Coho co-hosting today.
My name is Dan DeLong, owner ofDanwidth and School Bookkeeping.
Worked at Intuit today as well.
(01:33):
Workshop Wednesdays oddly enoughon Wednesdays and we'll pass it
over to Matt joining us todayfor a guest host
Matthew Fulton (01:43):
Hello everybody.
Matthew Fulton here with parkweb business solutions and qb
community live the facebookgroup Actually just want to use
my a couple quick seconds hereto do a big shout out and to
everybody in florida And theeast coast that's you know been
affected by all these differentstorms and the upcoming storms
so hope everybody's safe and
Dan DeLong (02:03):
Stay dry this this time.
And joining us for another time.
You've been on the Power Hourbefore, Rachel, but let's for
those that don't know Tell us alittle bit about yourself.
Rachel Dauchy (02:16):
Sure.
So I, like you said, also, I'm aco host with you with the
workshop Wednesday, which Ireally enjoy.
And I am just one of those folksthat really enjoy inventory.
So I, that's my backgroundbefore I came into the
QuickBooks world.
So I really fell into e commerceand retail, and now I'm doing a
lot of manufacturing andinventory setup and that kind of
(02:40):
thing.
So yeah, I do that.
Dan DeLong (02:42):
We appreciate you joining us and we'll actually
unpack a little bit about thespider web of industries that
you could actually get involvedwith with just e commerce in
general.
You can, you actually came fromthe inventory space
professionally before you becamea bookkeeper, right?
Rachel Dauchy (03:02):
Yep.
So I've always worked in goodsbased businesses, consumer
packaged goods and operationsand accounting.
And it's not, it's funny, it'snot necessarily one type of
industry.
It's really the way we do it.
Manage the inventory, theconnectivity, the automation, is
really what kind of we'retalking about when we're talking
(03:23):
about the e commerce specialty.
It's not necessarily just, itcan be a service business, it
could be digital downloads, itcould be all kinds of different
things that they're selling.
Dan DeLong (03:34):
Yeah, they definitely, there is no one size
fits all when it comes to thistype of industry.
So a little bit about the QBPower Hour every other Tuesday
the first QB power hour of themonth, which is this one is
eligible for TP and credit.
Thanks to our friends over atMakers Hub.
Ted is lurking in thebackground, making sure that we
(03:54):
fulfill our duties with pollquestions and making sure that
those certificates get emailedout post the work, the webinars.
We appreciate you joining us forthat.
You can always go to theqbpowerhour.
com slash resources.
Website for the PDFs of theslides, the recordings, the
podcast, and as well as otherresources.
A little bit of housekeeping, ifyou have specific questions
(04:17):
about topics that we're talkingabout today, please put them in
the Q& A, it makes it a loteasier to follow up and make
sure that we're addressing yourquestions.
As I see the webinar chat isscrolling by They tend to get
lost there, so it's really hardto manage that sort of thing,
but thank you to Matt joining ustoday, because he will do I see
(04:38):
he's typing already in there, sohe's helping out with that.
Rachel Dauchy (04:41):
Yeah, thank goodness for Matt.
I always say that.
Yes.
Dan DeLong (04:47):
And of course, we're we're simulcast or streaming on
the Facebook and social mediachannels.
If you are on the Facebook groupand want to participate please
use that QR code so that we cansee who you are when you when
you communicate or engage in theconversation.
We do have, of course, the KBPower Hour store to check things
out.
(05:07):
NRCP credit thanks again toMakers Hub for making that
available.
You get one hour.
You do have to participate,meaning that you have to answer
the poll questions.
And then we have a survey.
Post post webinar.
Our agenda today is we'll betalking about, and this all came
up about a year ago.
Rachel and I started a series ofa workshop on the workshop
(05:28):
Wednesday over at schoolbookkeeping about the nuances of
e commerce.
And and we're going to talkabout in real high level, just
what we talked and unpackedduring the, I don't know, what
was it, Rachel?
Was it it was like a couple.
A couple months of workshop thatwe really dug in there into the
conversations.
And
Rachel Dauchy (05:48):
we also like to talk about it a lot too.
So it's not that it's socomplicated.
We just love to chat about it.
Dan DeLong (05:55):
It was it was definitely a, an eye opening
discussion on both our parts,but we really want to talk about
really high level what wediscussed there and we've
created we've taken andrepurposed those those workshops
and turned them into an ecommerce fundamental course over
at School of Bookkeeping aswell.
Want to review all that thingsthat, a deeper dive that what
(06:16):
we're talking about here today.
We'll share those links at theend of the webinar, but really
we want to talk about, sellingonline in general shopping cart
versus a marketplace, what the,what that is inventory is going
to be specific typically it's aspecific nuance of this type of
industry and that as we're goingto unpack is really the, um,
(06:40):
when you're talking to a client,where the inventory source of
truth is really going todetermine a lot of other answer,
a lot of other questions thatyou might have when you're
working with them.
So typically they don't come toyou and say, here's my business.
Help me.
Or do they?
They
Rachel Dauchy (06:57):
do sometimes.
Matthew Fulton (06:59):
They come to you and say, here's my business,
help me.
But they don't say, here's allof my business, help me.
And oh, by the way, I forgot tomention these two other things
I'm going to add on next weekwhen you tell me not to do
anything and so forth.
Rachel Dauchy (07:13):
Exactly.
It usually comes in the form ofa surprise.
Dan DeLong (07:21):
And I'll add PayPal to all my sales channel.
And then there's always a salestax concern when it comes to
that.
We'll talk about those types ofconcerns omni channel selling
cause typically e commerce or a,a shopping cart as a gateway
drug.
Hey, they want to they want tosell other places as well.
Hey, if I can just do it here, Ican do it.
(07:42):
I can do it at Walmart or orAmazon or eBay or multiple
channels.
What's one more, right?
It's like when you have atriplet, um, what's one more
baby.
And then you get a surprise.
Yeah.
And then shipping andfulfillment will definitely be a
concern for e commerce salute ecommerce, the e commerce
(08:03):
industry.
And then we'll unpack some ofthe tech solutions that, that
will help streamline, hopefullythese processes, sales
connectors, the inventorymanagement system and then QBO
desktop synchronization.
And then if time permits, we'llhave some Q and A.
So our first poll question whilewe're Doing this, let's launch
(08:24):
that.
It's a two parter, right?
One, you need CPE credit fortoday's webinar, and two, you
currently have clients in the ecommerce space.
So Rachel, what really drove youto this state?
What made you get into this typeof industry?
Why would you do such a thing?
Rachel Dauchy (08:44):
First of all, I was very familiar with inventory
and inventory measurement andmovements, but I ended up when I
first started with QuickBooksonline and I've used all other
kinds of inventory softwares,my, whole professional career,
but I hadn't used QuickBooksonline.
I had used QuickBooks desktop.
And when I first started it, Iwas so clueless about QuickBooks
(09:07):
online that I thought I had toconnect everything to
automation.
I thought that was arequirement.
It's just funny how you justassume certain things.
I screwed it all up.
And so it took me a while tounravel it and figure it all
out.
So when I did that, I realized,oh, I can really service these e
commerce clients.
I just taught myself so manydifferent things.
(09:29):
And then I realized, oh, this issuch a great advantage because
even though I wasn't aninventory expert I know much
more now, but I thought, wow, Ican really use these few things
that I know.
And.
Just pick this niche And thenset myself apart from a lot of
other people and all you peopleon the call you might even hear
(09:50):
the same thing A lot ofbookkeepers and accountants will
say I don't touch inventory butif you equip yourself with a few
key fundamentals, you cancertainly do it and then not,
set yourself apart.
And now you're in a league ofyour own, and you don't really
have to compete with as manypeople.
So that was really important tome.
And that's really how myexperience has worked out.
(10:14):
So you
Dan DeLong (10:14):
had you had that knowledge, intimate knowledge of
inventory management, and thenjust
Rachel Dauchy (10:20):
Yeah, I did, but I also learned so much more as I
went along.
Of, okay, it's gotta work likethis, I gotta have a COGS entry,
okay.
Now that I discovered thisconnector is posting
transactions individually, thisconnector is posting
transactions.
Batched for the day.
(10:40):
How am I going to get my COGSentry?
Just figuring out so manydifferent things.
How is my COGS reporting goingto work in this situation?
You just learn so much as you goalong, almost inadvertently,
that it just works out that way.
Yeah, so
Dan DeLong (10:57):
you definitely don't go into this sort of industry
expecting to know everything.
Rachel Dauchy (11:03):
No, and you can't because you just don't.
A lot of these, what we're goingto get into, they, a lot of
these tech companies, SaaS,companies that sink into
QuickBooks do it differently.
That's why they're differentcompanies.
They don't all do it exactly thesame.
And I know Matt and Dan, youguys are so knowledgeable and
well connected with so manydifferent companies.
(11:25):
And so just the further that yougo along is now I have you just
learn how everybody does methink it does everything and how
these things are connected andhow it works.
But I will say, I'll just saythis because I think we're
probably going to get into this.
You don't have to be aninventory expert to do this kind
of e commerce bookkeeping andaccounting.
(11:46):
I get very involved in theinventory and help my clients
with the movement and housing oftheir inventory.
I personally don't get involvedin their shipping and
fulfillment.
That's something that they haveto take care of.
I am not involved in that atall.
I know other bookkeepers andaccountants that do not get
(12:07):
involved in where theirinventory is housed.
And they're just doing thebookkeeping.
And they're just, accounting forthe cogs and making sure
everything is timely.
It's really up to you.
There's no rules and that's whatI've learned along the way is
you just find, what you reallylike and what your inclination
is towards this type of thingand you can pick and choose and
(12:30):
I now am getting involved in,we'll talk about this a little
bit later, but an IMS, which iswhere you manage this inventory,
a cloud based IMS, the way thatit used to be done in QuickBooks
Desktop, but now we're doing itin a cloud based situation.
That's my jam.
So I don't, nobody has to do itthe way I do it.
There's a lot of different waysto get involved in it.
(12:53):
Yeah.
Dan DeLong (12:53):
Matthew, what do you, Where's your experience
from?
Is it more of you found a clientthat brought all this to your
attention or was it more of aspecialty for you to
Matthew Fulton (13:03):
found a couple clients over time that kind of
brought it to my attention andthen always being a button
pusher like that likes to try tobreak things and better
understand it.
I personally try to stay awayfrom having to track true
physical inventory where I canespecially within QuickBooks
(13:24):
online, because if it's a mess,it's a mess and which there's a
question actually from Carolyn,which I'm sure we'll get to
that's was asking about havingissues trying to upload
inventory for weekly batchupdate of thousands of items in
QBO.
I know some.
Apps that can externally do it,but I'm sure you may know other
items that can be done otherways.
But prefer to stay away fromsome quite a bit of the e
(13:45):
commerce stuff, but everything'se commerce now.
Dan DeLong (13:48):
Yeah, about four years ago Pretty much everybody
needed to at least have that ecommerce discussion.
Even people that met in personneeded to have some way to sell
something online that didn'trequire people to be in person.
No, we had we've, we've talked alot about this.
(14:08):
Type of topic in prior to bepower hour.
So I wanted to make sure that Ireally had the availability to
review those.
We did have Veronica Wasik onseveral years ago.
And she is one of those peoplethat Rachel was mentioning that.
Doesn't get involved
Rachel Dauchy (14:26):
with, that,
Dan DeLong (14:27):
That's her turn, her engagement is I'll live in the
QuickBooks and I'll get you setup, so that it comes into
QuickBooks in the way that Iwanted to, you do everything
else, and then they'll help ithelps her corral the cat, heard
the cats a little better whenyou have that, Framing in an
expectation setting.
(14:48):
So she has a great greatworkshop or QB power hour there.
We did have William English onto talk about his specialty of
retail when he was out in the onthe other side of the the Intuit
badge.
Now he's a QB assisted teamlead.
Funny how things work fullcircle.
We did have WebDuality on totalk about their solution.
(15:09):
And then I had a couple ofAmazon sellers that I was
working with do a paneldiscussion of what it's like to
work with that, that drunk uncleof selling, selling selling on
Amazon.
So you can always check thosecheck those out there.
They hold no punches of theirfeeling towards towards Amazon.
(15:30):
Oh, we don't want to start them.
Welcome everybody to another Oh!
Rachel Dauchy (15:33):
Oh boy, okay, see i'm not the only one dan.
Matthew Fulton (15:37):
Oh, wait Actually michelle told us we're
allowed to blame everything onher when she's not around
remember.
That's right.
I forgot about that
Dan DeLong (15:43):
So if you're considering specializing in e
commerce if we haven't scaredyou enough these are the things
that you're Potentially findyourself specializing in the
inventory management sellingonline Consulting and these are
things that you can Go down thatrabbit hole and and maybe find
yourself a home in like Rachelis finding inventory management
(16:07):
and those types of things to bereally where she, he finds her
passion regarding and all ofthese other things.
Maybe she's working withanother.
Partner, you know that canhandle those things.
So it comes in as a a team, youdon't have to wear all the hats
here
Rachel Dauchy (16:23):
Yeah, there is that situation going on for
sure.
Matthew Fulton (16:26):
Is this considered niching the niche or
niching the niche?
Dan DeLong (16:30):
Depends on what whether you're north of the
canadian border or not, I thinkthat's where the The
pronunciation we'll have to asksean at katana tomorrow when we
have him on the workshop What hesays But then there's eat online
selling consultant, right?
Like you could be specializingin setting up Shopify, from
(16:52):
start to finish marketplaceconsulting.
All right.
And, do you really want to dealwith Amazon?
You can get into those types ofservices, the retail aspect of e
commerce, right?
Do they have a brick and mortarstore in addition to selling on
then of course, that leads up tothe point of sale system.
What are they using to trackthose those sales?
(17:12):
And then of course, The 64, 000question of how that data gets
into QuickBooks.
And then of course
Rachel Dauchy (17:18):
Yeah, or do, can I even manage inventory in
QuickBooks with this situation?
Somebody that was, we were just,the chat maybe was saying
something about the thousands ofSKUs.
I would never do that inQuickBooks online, even if I was
only managing one channel.
So that should I do it here orshould I not do it here?
There is so much potential foradvisory.
(17:42):
This is my advisory.
I do this all day, every day.
Dan DeLong (17:47):
Yeah.
And then those retail channels,they're going to have
specialized service offeringsthat they might need, right?
Like the customer rewards,right?
Those types of things that theycould potentially be needing.
All of those things could be.
Be part of your technologicaladvisory services, if that's
what you want to specialize in,and then sales tax is going to
(18:10):
be a huge concern for somebodyselling online, especially if
they don't realize that they'vecrossed the economic nexus in a
certain state those things aregoing to necessarily be, uh,
that, that kind of someonelooking out for them, I think
is, that's probably the bestplace.
Matthew Fulton (18:29):
So this is one of the areas, yeah.
That I'm really interested tolearn a little bit more about
today as well.
And when I think of e commerceand a lot of people I'm helping.
Even just having communities andonline and selling subscriptions
of that nature It's e commercebecause as you're going to talk
about payment gateways versussales channels And you're when
(18:50):
you reach nexus in thesedifferent places so i'm excited
to hear a little bit more aboutsome of that stuff as we're all
building out these newcommunities for each other
Dan DeLong (19:00):
Yeah, and then, of course, shipping and
fulfillment.
So all of these could be, youcould be a generalist in just
this area, just one of theseareas or a, I'm sorry,
generalist in all of these areasor a specialist in just one of
these areas.
Lots of areas of places to, tofocus on.
Lots of rabbit holes to findyourself jumping down in this
(19:22):
particular area, right?
Let's first talk, talk aboutwhere you sell things, right?
Selling online you're gonna havesome options and and Rachel, we
had unpacked this whole idea ofa marketplace versus an online
shopping cart.
Rachel Dauchy (19:37):
This is something we address heavily in the course
in School of Bookkeeping.
Dan DeLong (19:43):
Yeah.
So talk a little bit about whata marketplace is versus versus
an online shopping cart, becausesimple thing is, Hey, I want to
sell stuff online, but thequestion is where and how, and
the.
Depending on where you do thosethings will determine a lot of
other workflows, right?
Rachel Dauchy (20:03):
Yeah, so one thing that we talked about
before is asking questions of anew potential client or even
somebody that you already haveas a client and maybe they're
looking to get into this.
Or maybe you have them as aclient and it's, Surprise! I do
this too! And that happens aswell.
There's always some corequestions you always want to
(20:24):
ask.
And if they're selling stuff,where are they selling that
stuff?
Or where do they want to sellthat stuff?
Some people sell that stuff inone retail store, where I'm just
taking on like a pack and shipstore.
And I'd consider that ecommerce, because they're
selling a whole bunch of stuffin their store, and we're
(20:47):
collecting those Those thatrevenue through a POS system.
So anyway, that and that we cantalk about a more later, but
basically it's where am Iselling this stuff?
If I'm selling it online or in astore, am I selling it on a
marketplace and a bymarketplace?
(21:07):
I mean something like Amazon anddad had a really good analogy to
this before.
It's basically like a swap meet.
It's not your swap meet.
It's a place that you go to andthere's a whole bunch of other
vendors.
So you're one of many, right?
So you're going to a place whereyou know there's going to be a
lot of buyers.
(21:28):
That's a marketplace.
So Amazon's a marketplace.
Etsy's a marketplace.
Walmart has a marketplace.
Walmart retail is not amarketplace.
But Walmart marketplaces.
And then there's a whole bunchof other e com marketplaces out
there.
And the main commonality thatthey all have is that they're
(21:51):
what is called a marketplacefacilitator.
Meaning, they collect the salestax from your buyer, they then
remit that sales tax to thestate, and they also file the
return.
That is an advantage of goingwith somebody like Amazon or
eBay or another kind ofmarketplace.
(22:13):
You still have to record thesales tax coming in the sales
tax going out, but you are notaccruing a sales tax liability.
That is the most importantthing.
That's enticing to peoplebecause they don't want to deal
with sales tax.
And I get it.
Sales tax sucks.
So they'll often be willing topay the high fees of something
(22:38):
like a marketplace.
The other option would be a,what'd you call it?
Like your own, whatever.
Yard
Dan DeLong (22:46):
sale.
Yeah,
Rachel Dauchy (22:49):
so your own website would be something like
Shopify or WooCommerce orsomething like that where it's
your own business likejoeshardwarestore.
com.
It's your own domain and you areresponsible for the traffic of
getting people to your website.
You also have to collect thesales tax and then you have to
(23:12):
remit the sales tax.
And because it's online, ifyou're in an online store,
people could be buying fromanywhere.
And so that collects what wecall economic nexus.
That's all I'm going to sayabout that.
We have a course on that in theworkshop, but in school
bookkeeping.
But the other piece of thatwould be if you have your own
(23:33):
retail store, your own salon oryour own, whatever.
where you're collecting your ownpayments and then you're
obligated to pay your own salestax.
I lump that under e commercebecause I'm usually taking some
kind of electronic POS payouts.
And so again, and Matt, youprobably know all about this.
(23:55):
This is something that is alsoneeds to be synced to QuickBooks
Online.
To post the revenue, becauseI'll ask you guys one question.
We talk about this all the timein this course.
Do we post payouts to revenue?
No, never ever.
(24:18):
So in quick, now here's thebeauty with QuickBooks online.
This is all sinking intoQuickBooks online.
You bookkeepers out there.
What posts revenue?
A sales receipt, an invoice, ora journal entry.
So that's how the revenue comesin.
The payouts can sometimes comein two days, three days, two
(24:41):
weeks later.
It really depends.
So that all these are things toknow about but the main question
is find out from your potentialclient or your client where they
are selling and again you can bea expert get some information on
the fees involved in either andposition yourself to be an
(25:06):
expert and hey you might want toconsider something like amazon
yeah the fees are high but lookat the the advertising potential
you can get from that.
Or don't do that.
Maybe go the Shopify route.
Maybe you're a Google SEOspecialist and you have some
insight into that and can helpyour client, navigate that
(25:27):
world.
And I don't know anything aboutthat.
So that's where I would reachout to somebody like Matt, who's
an SEO expert.
Matthew Fulton (25:34):
Probably Dan It's better.
But can I try to summarize tomake sure I heard?
Rachel Dauchy (25:39):
Yeah
Matthew Fulton (25:39):
a big difference between it being it's like a
marketplace What you're tellingus is it's important for us to
talk to the client to number oneunderstand where they are
selling everything and then toYou also need to know how you
get paid for everything yousold.
Rachel Dauchy (25:56):
Yes,
Matthew Fulton (25:57):
because depending on how you get paid if
it's going through a saleschannel where you're selecting
it through Authorized.
net or any of these otherdifferent ones that are paypal
which Dan and I were jokingpaypal is the only six letter
four letter word out there.
Yeah
Rachel Dauchy (26:15):
There's a million and one different ways to
collect that money You
Matthew Fulton (26:20):
Yep.
And so when you have thatcontrol, that's talking about
the shopping cart.
And then the shopping cart hasto have a really good
understanding of sales tax,pinpoint rooftop type stuff that
to save your rear down thefuture.
Rachel Dauchy (26:33):
Yeah.
And then there's also, and I,maybe we'll get into this a
little bit later, but there'sall kinds of automated sales tax
apps.
That I'm looking a lot intonumeral right now that will
track that nexus.
And so it'll determine, that's awhole separate webinar that we
could do about what achievesnexus.
But there's a lot of resourcesonline about that.
(26:55):
That's something that's reallyimportant to know.
But it, software can do it foryou.
Dan DeLong (27:01):
And the big thing is there's pros and cons to either,
either route, right?
So you're in, in, in what youhad mentioned about the
marketplace is you're going tohave sales tax calculated by
them.
They're going to be handling thecustomer service and of most of
these sale and then on the.
Individual online shopping cart,Shopify being, an example of
(27:22):
one, all of the end to end,you're going to own that, right?
So another analogy I would sayis if you're a farmer, you can
set up a farm, stand on the sideof the road and you have control
of everything.
From customers coming in, howthose things are fulfilled and
everything.
Or you take all your goods overto a farmer's market.
Rachel Dauchy (27:43):
Yeah.
And
Dan DeLong (27:44):
that will have, foot traffic already built in because
people know that there's afarmer's market Yeah.
And such a dick larger
Rachel Dauchy (27:50):
audience.
Yeah.
And by the way, Shopify, and I'ma Shopify partner.
Shopify by far in my opinion, isthe best they actually have.
I don't know most of the marketshare, not most, a significant
number, I used to know it offthe top of my head, of all
online sales.
And I think last year they wereresponsible for 65 billion worth
(28:11):
of online sales.
They're by the way, Shopifypayments is a payment method
powered by Stripe.
It has the most powerfulshopping cart.
Most integrated, most integrateability.
Is that a word?
Yeah.
Integratable of all the peoplein the QuickBooks ecosphere that
(28:32):
are building apps to get datainto QuickBooks.
Shopify is by far the best.
Dan DeLong (28:40):
But you can certainly find yourself into
those rabbit holes of what appsand add ons
Rachel Dauchy (28:45):
in
Dan DeLong (28:46):
the Shopify space.
But the next biggest thing, andthis is probably the biggest key
factor to determine when you'retaking on an e commerce client,
is inventory management.
Rachel Dauchy (28:58):
Yeah,
Dan DeLong (28:58):
determining where that source of truth is it going
to be in the online saleschannel?
Is it going to be in QuickBooksor is there something that's
necessary in between the onlinesales channel and QuickBooks to
manage that inventory?
Because that's going to reallydictate the workflow, the
purchasing, receiving sales taxAnd your sales tax I'm sorry,
your technology solutionsRachel, what are you what are
(29:21):
your thoughts about that?
Rachel Dauchy (29:22):
Yeah.
So as, so the first importantquestion, like I said, was
determining where are theyselling?
The next important thing todetermine is.
Where is my inventory going tolive?
But before you ask thatquestion, you have to know, and
this is where a lot of peopleare very confused and clients
(29:43):
are very confused.
And it's this, are they dropshipping or are they carrying an
inventory?
Meaning are they buying goodsthat they're either storing in
their garage, in a warehouse, Ina fleet of warehouses and are
(30:04):
they shipping out their ownstuff?
That is extremely importantbecause a lot of people come to
me as dropshippers, they don'tunderstand that they're even
dropshipping.
And what that means is, they'renot holding an inventory, they
are Facilitating, they'regetting the inventory that's
over here with some otherprovider and they're making the
(30:26):
sale and that provider isshipping it.
So they're not actually buyingthe inventory, recording the
sale and putting it to inventoryand then recording a cost of
goods sold entry at the point ofsale.
That's not happening.
So if they're drop shipping,they're not holding any kind of
(30:46):
inventory and it's actuallyquite simple.
And we talk about that in theschool of bookkeeping.
If they are buying goods foreither resale or.
Sorry, if they're buying goodsfor resale, then they're holding
an inventory.
Then it shoots off into, am Iholding the inventory on the
(31:07):
balance sheet?
Or am I actually just hittingcost of goods sold right away
with this inventory?
That hitting the cost of goodssold right away with the
inventory, isn't my preferredway to do it.
It's the easy way, and it's not,it could cause them to be upside
down on their P& L.
We'll talk about that anothertime, but that is the most
(31:29):
important question to know.
Aside from, am I dropshipping?
Am I not dropshipping?
That requires some reallylistening to them to understand.
But if they are fulfilling theirown stuff, then we have to
determine, Can I manage that inQuickBooks?
(31:50):
The most important thing out ofthis whole other question
besides what are they selling?
And this is crucial.
If they are buying rawmaterials, assembling those raw
materials into a finished good,and selling it, automatically no
QuickBooks Online.
They cannot do it.
(32:11):
Now, if they're buying stuff,putting it in their garage,
warehouse, or any otherfulfillment house, and it's just
reselling it, they can do it inQuickBooks Online.
And let's say, for example, andI'm going to keep it really
simple.
Let's say, They're a wholesalerand they're, so no sales tax.
So they're buying goods, let'ssay from China, finished goods.
(32:34):
They're putting it in awarehouse and then they are
selling to a wholesaler, sendingthem an invoice.
Let's say not even doing an, anykind of e commerce thing.
They're just wholesaling.
They can then manage those itemsin QuickBooks online.
100 percent I would even say ifthey've got thousands of SKUs,
(32:56):
they can do it in QuickBooksonline.
Because they're setting thatinventory up to when the
purchasing is made goes intoinventory and then when they
sell it with an invoice, itdecreases the inventory and hits
cost of goods sold.
So that's an example of can I doit in QuickBooks or can I not do
(33:17):
it in QuickBooks?
So Dan, you have a whole bunchof other of why can't I do it in
QuickBooks.
So why don't you give an exampleof that?
Dan DeLong (33:26):
Yeah.
So we so yeah, so we've we'veunpacked this and this is one of
those rabbit holes that we endedup going down in managing the
inventory.
So we've created a separatecourse for managing inventory.
Can you do it in QuickBooksonline?
I I wrote a blog on the firm ofthe future of what you can do,
but really those three thingswhat you mentioned there is if
(33:48):
they're reselling, I buy stuffand I sell that same stuff.
I've got maybe some periodicinventory that I want to keep
track of but I don't do anythingfancy, right?
So I don't.
I don't need to track like Ihave a a client who's a
distributor of alcohol and thetax even Napa Valley, so it's
wine and tequila.
I don't know why they go fromone end of the spectrum to the
(34:11):
other, but Carol, California, hebuys in a, Base unit of measure
of a bottle, but he's got totell the state how many gallons
he has at a certain, at the endof the year, because the fact
man wants to know how manygallons that is.
So we have to convert that to toa volume discount, so to speak
(34:33):
to do that, and that's notsomething you're going to get
out of QuickBooks online.
You're going to need some kindof third party application in
order to get those same reports.
Rachel Dauchy (34:43):
Yeah, so and then so let me just give like a
really quick little examplebecause somebody just asked
inventory can be tracked inQuickBooks Enterprise.
It's not really an issue of canI track it or can I not track
it?
It's a matter of the complexitythat can be involved.
So so again, like this pollquestion that Dan's asking, do
(35:05):
you recommend tracking inventoryin QuickBooks?
Yes.
Certain situations, yes, andI'll give you a perfect example
of a client of mine that we dotrack it with a periodic
inventory, okay?
This is a retail store.
They sell very expensive musicalinstruments and a very low
volume of it, okay?
(35:26):
This is a very ideal situationfor a periodic inventory.
In the store, they collect theirpayments through Stripe, right?
The invoices come in, but withthose invoices, we don't have a
COGS entry.
All it's doing is justcollecting revenue, right?
Revenue payment.
That's it.
At six month mark, we count theinventory, and at that point,
(35:51):
decrease inventory, increaseCOGS.
That's it, end of story.
But we can track the ins andouts with of the sales with
QuickBooks Online, which isreally nice, but that inventory
just stays put, right?
So now a perpetual inventory,the same thing, let's just say
(36:13):
like I have the other clientwith that we're going to onboard
with the, box store, right?
The where they're selling, Idon't know, tape and boxes and
staplers and mailers and stuff.
Those can all go into QuickBooksOnline as inventory items, if
you're using Plus or Advanced.
And we can, when we make thosepurchases, increase the value or
(36:38):
increase the quantities ofthose, use that reporting in
QuickBooks Online.
It's only one channel.
It's just one store.
And then they're, they'reinvoicing from QuickBooks
Online, the inventory goes down,hits cost of goods sold right
away.
The reason that we would need anexternal hub for inventory is
(36:59):
because we would need acomplexity of something like we
do in QuickBooks Enterprise,where we're multi channel or,
all kinds of differentcomplexity.
And now the advantage of thatversus doing it in QuickBooks
Enterprise, it's cloud based,and I can sink in all kinds of
other stuff, and I can usereporting tools, and my client
(37:22):
can be cloud based, and I can becloud based, and that's where
somebody like Matt can jump onthis because he's an expert on
all this cloud software and youdon't have to remote into your
client's desktop enterprisecomputer, which is not for me.
That slows down my business.
I can't really scale like if I'musing one provider like sin
(37:45):
seven, like I can scale a lotbetter because I have everybody
Feeding the data into qbo andi'm using something like since 7
where everybody goes on it.
I use katana, too But for me asa firm owner, I don't have to
spend all this time going intosomebody's desktop computer So
just wanted to address thatreally quick.
Matthew Fulton (38:05):
Are you familiar with fishbowl?
Rachel Dauchy (38:07):
Yeah, I do but fishbowl is also a desktop
software that you would have toremote into They do have a cloud
based solution right now, but itcan't really do much, and it
also can't be multi channel.
The last time I talked to them,They told me that, but that
might have changed by now.
I can't be on a cloud based IMSthat can only manage one
(38:28):
channel.
Something like SYN7 to me isperfect.
You can dropship.
You can also do holding aninventory.
Something like Katana, youcannot drop ship.
So it's a total workaround.
There's just differentadvantages to other, to, to
different cloud based
Matthew Fulton (38:44):
IMSs.
Part of the reason I was askingjust real quick was Kate had
asked in the questions aboutspecific about Fishbowl and
fulfillment.
Can COGS all be managed inFishbowl?
Yes, it can.
Yeah.
And so
Rachel Dauchy (38:57):
The advantage of using an IMS.
Is that the invoicing can go, isgoing from that platform and it
just syncs all to QBO.
And hey, guess what?
If you don't want it to syncthat way, you can bypass it with
a connector like Cinder orBookkeep or PayTracker or
whatever.
And then you can pull your COGSmonthly from the IMS, post them
(39:21):
to QuickBooks.
And actually I'm training aclient to do that later today.
I'm working in Katana with them.
And we actually bypass we postthe revenue with Cinder.
But because we don't want to bebeholden to updating the cogs in
Shopify all the time, we wantthem from the IMS.
We're going to pull them fromthat and post them manually to
(39:42):
QuickBooks Online.
There's all kinds of differentways you can be creative and do
it.
And it really is based on theirneeds.
Dan DeLong (39:51):
Absolutely.
So yeah, we can definitelyprobably spend the entire work
power hour talking about yourfavorite topic.
Yeah, for sure.
And like
Rachel Dauchy (40:01):
somebody is saying, yes, you can do it in
QuickBooks Enterprise, but Ijumped onto QBO five years ago
from, complex situations likeSAP.
I like the cloud Setup and sofor me, all I do is get
notifications all day long abouthow quick enterprise is No, no
(40:22):
longer supported or I don't knowwhat, but or maybe it's the pro
and premier that are no longerbeing sold.
And I don't know how longenterprise is going to be
supported.
If they're going to be doingupdates, I don't know.
And my business, I'm building itto, to scale and also to be a
longterm business.
I don't want to.
(40:42):
I don't want to get myselfinvolved in something that may
be going away.
Dan DeLong (40:47):
Yeah, you just end up finding yourself a new
solution in, or having thisconversation, a little bit down
the road.
Rachel Dauchy (40:54):
Yeah.
Dan DeLong (40:54):
I'm reminded of several political policies that
do the same thing, where theyjust, oh, we'll just, Increase
the debt ceiling.
Rachel Dauchy (41:01):
Yeah.
Dan DeLong (41:02):
Speaking of government policies, we've got
sales tax considerations, whichwe had a really nice series with
Avalara.
They are probably the goldstandard of of sales tax
collecting remittance services.
There are others that are outthere but we're really unpack
more things, that reallyinvolve.
With sales tax, what do I sell?
(41:23):
What kind of products do Iactually sell?
Is it services?
Is it hard goods?
Where do I sell it?
Which un unlocks this.
Specific topic of nexus and isreally concerning or a concern
for a for an e commerce sellerselling across the lines of
whether it's a physical nexus oran economic nexus who do I sell
(41:44):
it to, right?
Maybe they're wholesalers andthey have a resell sales tax.
Um, or a reseller certificate.
That's the word I was lookingfor where they don't get charged
sales tax.
And then there's this otheroption of when do I sell it?
Maybe it's during a sales taxholiday or something like that.
So all of those things fall intothis.
(42:05):
Then diagram of, is itcollecting sales tax?
And then it's the amount of whatdo I have to collect?
Is it a luxury item or food andbeverage?
The category of the item, allthose go into that.
In the essence of time, there'slinks there for the, for those
workshops.
You can get free access to theseworkshops and all the other
workshops that we do at Schoolof Bookkeeping.
(42:26):
Those links are there in theslides.
Shipping and fulfillment isanother Workflow concern do they
do that themselves or we talkabout this idea of a 3PL with
Unpack that for us Rachel.
Rachel Dauchy (42:41):
That means a third party logistics.
So that's basically is somebodyelse housing and fulfilling
their inventory for them andOftentimes they'll arrange their
shipping for them as well.
And
Dan DeLong (42:55):
You mentioned dropshipping before.
Rachel Dauchy (42:57):
Yeah.
Would
Dan DeLong (42:57):
a 3PL be considered a dropshipper if they are doing
the selling?
Rachel Dauchy (43:02):
That's a really good question.
I don't know if that'stechnically considered
dropshipping because I thinkThat is still, if it lives in
the 3PL, it's still technicallyyour inventory.
No, I would say no.
If it's on somebody else'sbalance sheet, that's
technically dropshipping.
I'm just grabbing that sale andthen I'm accounting for the cost
(43:26):
of goods sold at that time.
That's usually how dropshippersdo it.
It's not any kind of periodic orperpetual inventory.
But yeah, so a 3PL is basicallywhen you get large enough, you
want to house and ship yourinventory.
I used to work for a bottlingfacility and we used to have
(43:46):
3PLs in California, Texas andNew York because obviously that
cuts down on the shipping acrossthe country.
And so the order, depending onthe ship address gets routed to
whatever 3PL and then it shipsfrom there.
Now there's all kinds ofintegrated software that you,
cloud based software that youcan use for that like
(44:09):
ShipStation.
And that can be integrated intoyour IMS.
So it knows where, when exactlyit shipped.
So that is actually accountingfor the sale date.
And so there's no confusionabout that.
So it's um, I'm really a big fanof, like I said before, cloud
(44:30):
based everything, everything'sset up on automation.
So that way it's running in realtime, very smoothly.
And yeah, it takes a bit of timeto really understand all these
different moving pieces, but theaccounting behind it is not that
difficult.
And if you really, justunderstand this basic okay, I'm
(44:53):
buying goods and I'm puttingthem into inventory and I'm
really only going to account forthe cost.
When the item is sold, then yoursale posting is also going to
have a COGS entry.
And by the way, if you'retracking inventory in QuickBooks
Online, that QuickBooks invoicealso has a COGS entry when you
(45:19):
have inventory turned on.
If you are managing inventory inQuickBooks and anybody on this
call, you're And you are doingit and it's working great and
they have a simple enoughsituation.
Look at one of those invoices,look at the transaction journal
and you'll see that COGS entrythat's posting along with it.
(45:39):
It's really cool to understandthe movements that are happening
and you're recognizing that costof goods sold on a true accrual
basis, which is going to giveyou that P and L on an accrual
basis, but you really need totrack your cogs in the period
(46:00):
that the item was sold.
Because if you're buying allyour inventory up front.
In the beginning of one year,and then let's say you're slow
all year, and then you selleverything the following year
you want to make sure thatyou're recognizing the cost of
goods sold in the time that it'ssold, and that's really
important for businessintelligence.
(46:20):
If you're just, hitting cogsright away with all your
purchases.
It's the quick and dirty easyway to do it, but I know people
that have done it that way.
Again, it just really depends onwhat they're selling and maybe
is the stuff low cost and theyjust expense it right away and
it's not really that big of adeal.
It really just, like Dan and Ialways say, it just really
depends.
It just, Take a look at whatthey're selling, look it up
(46:44):
online, do some research, lookat, there's all kinds of
inventory accounting resourcesout there.
What you know I was just tryingto think of that one like
accounting Whatever 101 thing tolook up and look like what does
cogs mean?
Just all these different thingsand you can get some information
on that
Dan DeLong (47:03):
And just to touch loop back to shipping there is
an option in quickbooks to beable to print your own shipping
labels in inside of quickbooksonline, but If you're not
managing the sale in quickbooksonline You're not going to be
able to do that.
So that's again, talking aboutthe The priority of where is
(47:24):
your inventory going to beliving?
And that's where you're going tobe doing all of the other
workflows.
That's
Rachel Dauchy (47:30):
yeah and that's really important to know because
I and i've talked to a lot ofdifferent providers about this
And when my situation I usequickbooks to collect the data
not necessarily do the stuff.
I do the stuff You outside ofQuickBooks, I then bring the
(47:52):
data into QuickBooks.
So I have a consolidatedfinancial statement, right?
So for people that are used todoing all the stuff in
QuickBooks online, it might feela little weird, that's what I'm
saying is you can bring thatsale into QuickBooks, have your
sale, and then create a shippinglabel.
It's really At this point, Ipick and choose what do I want
(48:14):
to do in QBO and or do I want todo anything in QBO?
Do I just want to leave it as abucket and just dump all the
data in it?
It's just, there's a lot offlexibility now of how do I want
to do this?
And it's really cool becauseyou're not just, you don't have
to do it a certain way, which isthe way I thought when I first
(48:36):
came into it, I thought I had todo it this way.
The cloud gods were up theresaying, you have to do it this
way.
Otherwise you're going to bepenalized.
And as long as you're following,the What, accounting rules,
whatever, there's all kinds ofdifferent solutions that you can
stumble onto and perfect.
It's really neat.
Dan DeLong (48:58):
So we want to make sure that we cover, at least
gloss over the rest of thetopics here.
So multi channel filling, thisis like an omni channel where
you're selling online a multipleoutlet, where you've got this
hybrid of selling in Shopify andAmazon, it's exponentially more
(49:19):
complex as the image here here'sthe father, the expectant's
father, he was expecting onebaby, oh, now there's three at
at the same time various paymentmethods across all of those
sales channels, multi currencyif they're selling in
internationally, and thenthere's that four letter word
of, PayPal.
(49:41):
And then all of that boils downto how do I get my sales data
into QuickBooks?
We have these a variety of salesconnectors that we call them or
bridges.
We're not quite sure exactlywhat the terminology of it all
is.
But we had we integrate on, wetalk about.
Comparison of Webgility versusVendor and then there's Bookkeep
(50:01):
and A2X that do summarizetransactions.
All of those things are unpackedin, in that as well.
And then, Oh, there's this otherthing.
QuickBooks has its ownconnection.
What about that, right?
There's one thing that, youseamlessly connect your sales
channels, there's there's a fewyeah, buts.
You can't use inventory whenyou're using these sales channel
(50:23):
connectors in the commercesection of QuickBooks online.
You've got a limited.
Amount of sales channels tochoose from and those sales post
on payout.
So if you,
Rachel Dauchy (50:36):
I think they created that just so they can
say that they have it.
I don't use those.
Natia, have
Dan DeLong (50:41):
you have you gone down this rabbit hole inside of
QuickBooks Online?
No,
Matthew Fulton (50:46):
my I would not, no, it's not worth doing that.
It's getting on into a darktunnel with the sound of a train
coming and the train doesn'thave a light on because you
already know that you're goingto get hit by something.
Pay at the thing I want to addon is paypal.
There should be no comminglingof paypal ever if you're going
to use paypal like
Rachel Dauchy (51:05):
Such a good point,
Matthew Fulton (51:05):
right?
if you really have to do it setup different paypal accounts for
other personal stuff, but
Dan DeLong (51:14):
So we we talk about the there's one size fits all
Doesn't fit all like for all ofyour sales connector needs,
right?
Maybe you have a client who'sonly in Shopify and they want
that detail inside of QuickBooksreintegrate is actually a really
good solution for them.
Their price point issignificantly less than
something like a Cinder orWebGility if they're only using
(51:35):
Shopify if you're not needingthe sales detail, Bookkeep is a
fantastic place to Salesconnector to bring in those and
split the sale versus the payoutand reconcile those two So we
talk about the pros and cons ofeach one
Matthew Fulton (51:51):
one thing i'm
Dan DeLong (51:51):
working
Matthew Fulton (51:52):
Go ahead one thing on this real quickly when
you're able to use a softwarethat's going to do either sales
receiver or an invoice You canactually take advantage of
bundles and you can bundlethings in and get more metrics
from reporting as a sneaky way.
And you can't do that whenjournal entries are being used.
Just food for thought.
Rachel Dauchy (52:13):
Yeah.
And just to also say, Cinderdoes either journal entries or
sales transactions.
And with the sales transactions,you can do either sales receipt
or invoice.
Dan DeLong (52:27):
We'll launch the last poll question as we're
talking through the last lastthing here.
Obviously, this is just touchingon the surface of some of these
topics and it, and they do getinto the weeds really quickly as
we've as we've been able tounpack just in, in this hour.
So we've unpacked those,expanded them, made them easier
(52:48):
to consume.
We tried to take each topic.
And turn it into at most fiveminutes, a five minute
discussion.
You can go into these coursesand these lessons, ask questions
in the comments.
We'll answer them.
There is a community in, inthere outside of the social
media spectrum where you can askmore specific questions as well.
(53:10):
And then there's options ofmentorship.
Hey I want to.
Go right in, I've got thisclient and I need to, I need
some help sorting through someof these things.
We've got that there as well.
And you'll also have access tothat managing inventory course
as well.
We have a 30 day free trialneeds a promo code, a work,
you'd be power, our users, allthat great stuff there.
(53:31):
Yeah.
And I'm a member of that
Rachel Dauchy (53:34):
school of bookkeeping community too.
And I've gotten more involved inthe community and answering
questions and stuff.
So it's really cool.
Dan DeLong (53:42):
All right, so we did launch the poll question there
and it looks like a lot ofpeople got some good information
here.
I did want to answer onequestion live and I flagged it.
Where did it go?
The question was
Matthew Fulton (53:54):
by Wayne, who said, My client primarily sells
via website, but he has addedmarketplaces like Amazon.
Shopify has a process to managethe marketplace within Shopify.
So is it good to let Shopifymanage this, or is there an app
that should be in the middleinstead?
Dan DeLong (54:09):
Yeah.
That's that's a it's dependsanswer, right?
Because bringing that into intoshop in those Amazon sales into
Shopify.
The question is what's going tohappen with the payout regarding
his Amazon sales?
Because as we.
As you understand with Amazon,the payout is significantly
(54:30):
delayed when it comes to that,that particular marketplace.
And of course they throw out allthe fees.
The storage fees, the I lookedat this transaction fee.
I I made this be so complicated.
You don't argue when you contactAmazon seller central.
All of those fees are thrown inthere and those come two weeks
(54:51):
later.
And Oh, and then you also haverefunds and returns and all of
those things.
That is probably not going to beas detail oriented by bringing
that sale into Shopify.
And then trying to reconcilethat sale to the payout is going
to be significantly harder byjust bringing the sale into the
(55:12):
Shopify Ecosystem and thenbringing that into into
QuickBooks.
That's going to be a complicatedanswer.
You probably want to keep thosethings separate and keep those
things and clearing with aseparate clearing account.
I
Rachel Dauchy (55:27):
know Amazon has the ability to do that now,
bring it into Shopify.
So then you can manage yourinventory within Shopify using
something like Stocky.
I would use an IMS over that.
Dan DeLong (55:38):
Especially when you have that additional
complication of multiple saleschannels.
Keeping those separate and maybein something else.
And other people were using,Fishbowl as a route to do that.
Keeping those outside of that.
So we appreciate you all joiningus here today.
We did talk a lot about some ofthe specific nuances of E
(55:59):
commerce Rachel, appreciate youjoining us today.
You're a wealth of knowledge inthis area and Matthew I
appreciate you and your insightsas well.
Any closing thoughts Matthew onwhat we talked about today?
Matthew Fulton (56:12):
No, I have, it's fun being up here and still
actually being in listening andlearning mode.
It's why I still attend thesemyself all the time.
There's so much that I canlearn.
And I learned about Dan's uncle.
Dan DeLong (56:24):
Yeah, that's the uncle that always shows up at
the holiday dinner.
You're not quite sure what'sgoing to happen with Amazon,
it's probably, you're notprobably going to like it.
All right.
So we will see you all next timeon the QB power hour.
And if you're so inclined tojoin us tomorrow on the workshop
Wednesday, we'll talk more withRachel.
Then with, we're actuallycomparing QuickBooks enterprise,
(56:46):
the desktop enterprise to acloud based solution of Katana.
So join us tomorrow.
Rachel Dauchy (56:52):
So much more things now that they used to
have.
Matthew Fulton (56:56):
And
Dan DeLong (56:57):
thank you to
Matthew Fulton (56:57):
Makers Hub also, right?
Dan DeLong (56:59):
Yes, absolutely.
And we'll see you next time onthe QB Power.
Everybody have a great day.
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