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Accountant Grows Business by Helping E-commerce Companies Reduce Fees On Payments

Catching Clouds, an Accounting Services, Virtual Bookkeeping, and Virtual Controller company for online and e-commerce businesses, has been a Bill.com customer since virtually before they started the company. The power couple husband-wife team are well-known as sharp, energetic and great at delivering results. They focus specifically on e-commerce businesses and the unique needs for companies that sell online.

We recently spoke with Scott Scharf, cofounder and virtual CIO/CTO of Catching Clouds, to understand ways that e-commerce companies can improve their bottom line. Scott was direct and quick with his response: Fees on merchant payments have ranged from 5% - 7% in the past and should be in the 2.9% or lower these days, the higher fees for an e-commerce business can have serious financial consequences.

E-commerce Businesses Are Accelerated Businesses

An e-commerce business needs the right financial information to make good decisions, just like any other business. The difference is in the sales cycles, which are extremely accelerated. E-commerce is very much a real-time business, with the storefront being open 24/7 and few time zone or geographical barriers. This is not a steady, scheduled quarterly buying environment!

This kind of speed means that small fees, possibly inconsequential when you first started your e-commerce business, can multiply quickly. Founders and accountants can miss these fees simply because they originally didn’t matter much.

This means that Catching Clouds first needs to understand your business, its goals, and where and how you sell the product. Do you use marketplaces like Amazon, Amazon FBA, eBay, Shopify, BigCommerce or others? Each e-commerce business is unique.

The challenge is finding where all the data is hidden. You need to fully understand your payment processes. What kinds of fees are you paying regularly? What are you doing with credit cards? How are you handling sales tax in different states? Do you use payment services like Stripe and Authorize.Net?

On average, ecommerce businesses companies can have up to 12 credit cards or more. Yes, more than 10. How many do you have? Credit card transactions can get complex quickly with usage points and other differences. Scott says “I have a background in PCI auditing with a deep understanding of merchant process space. How do you account for points the business owner receives? It’s critical to watch this.”

Fees Will Hurt You

With the move to the cloud, accounting is evolving very quickly. Some accounting technology solutions that are essential today simply did not exist 5 years ago when you started your company. Stripe, for example, was founded in September 2011.

There are plenty of great alternatives for business payment processing. Fundamentally you have to understand how you’re collecting money as well as how you’re spending money. This may sound simple, but it is not. Catching Clouds, a Bill.com Expert partner, provides consulting on technology and business processes in addition to accounting. Scott looks at things like insurance and other areas that often miss scrutiny.

Plenty of clients are paying 5-7% on payments without really paying attention. That should be 2.9% and 30 cents per transaction. With a client doing 50k transactions a month, this has significant impact.  

Scott believes “We should be your business advisors, your controller, so we can catch areas that you’re missing. That’s the strength of using an outside consulting service. We don’t just say your books are done and move on.”

Interesting In Hearing More About Fixing Fees?

View a free webinar recording where Scott provides details on accounting technology for e-commerce businesses.

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Tanya Roberts
VP of Corporate Marketing, Bill.com
Tanya is a marketing visionary seasoned in establishing strong corporate brands and growth. Prior to Bill.com, she served as SVP of Marketing for GreenRoad, acting VP of Marketing for Drivewyze, and held executive roles at Intuit, SugarSync and PayCycle. Tanya holds a bachelor of science degree from University of Denver.