Businesses of every size can learn a lot from Walmart’s e-commerce accounting practices. This giant retailer has developed an impressive system that integrates its online store with its traditional stores. Let’s dive into the fundamental s of what makes Walmart’s accounting practices great.
1. Outstanding Inventory Tracking
Walmart wants to satisfy its customers. When e-commerce customers place an order, they must receive what they ordered in a reasonable amount of time. Unfortunately, system errors may cause discrepancies between e-commerce and physical inventories. When this happens, customers experience and may become dissatisfied. Hence, inventory management plays a vital role in e-commerce.
Sometimes, errors in inventory management can cause on-hand inventory items to go unsold. When this happens, customers see a message stating that the item they desire is out of stock. Besides losing such sales to competitors, the inventory could become stagnant. Sometimes, as with technology items, the products could become obsolete.
The cause of inventory discrepancies may range from clerical errors to slippage. Walmart’s e-commerce process becomes a lot more complicated because they allow online shoppers to buy goods from local stores. Sometimes, if employees don’t quickly pull an order, problems can occur. For example, an in-store shopper might buy it before it is able to be shipped. In such cases, inventory tracking issues may result. Such a situation illustrates the importance of Walmart’s e-commerce CFO advisory CPAs.
These team members monitor and analyze inventory levels for various items to support the purchasing department. This information helps Walmart forecast sales in ways that give suppliers enough time to scale their production. The Walmart e-commerce bookkeeping system ensures that the right goods arrive at the right distribution centers and stores at the right time.
2. Walmart's Accounting and Tax Planning
Walmart’s e-commerce tax planning involves an extensive network of accounting teams that work together to minimize the company’s tax liability. For example, Walmart’s tax accountants depend on Walmart’s e-commerce accounting system to track sales taxes based on the location of their customers. Whenever Walmart does not comply with the tax laws of regional, state and local jurisdictions, the company may become liable for substantial penalties.
Auditors and investors both depend on the Walmart e-commerce bookkeeping system to keep track of the firm’s taxable revenue. Without effective tax planning, a healthy gross sales figure could become troubling. For this reason, Walmart’s e-commerce CFO advisory accountants continuously monitor the company’s sales totals and strategically shift inventory and other assets to reduce the amount of taxes Walmart must pay.
Besides sales and income taxes, the Walmart e-commerce tax planning team must consider property taxes and payroll taxes. Therefore, the location and size of their facilities can indirectly impact the firm’s profitability, accountants must work with the Walmart’s human resources team to minimize the impact of labor on the company’s bottom line.
3. Getting Help From Our Expert Financial Advisers
By properly managing inventory and planning for taxes, Walmart can continuously improve profitability and please shareholders. Many small businesses can also benefit from doing the same. The complexities of managing your finances can easily become unmanageable. If you own or manage a thriving e-commerce business, you might feel overwhelmed. Fortunately, you can get professional accounting help from our team of knowledgeable e-commerce accountants.
By utilizing the services of our e-commerce accounting firm, you can stay focused on growing and managing your business and enjoy the benefits of expert e-commerce inventory management, bookkeeping, and tax planning. You’ll also have the help of our team of experienced e-commerce CFO advisors to help with negotiating contracts, positioning products, and developing financial strategies that can support long-term growth and stability.
Avoid becoming overwhelmed. Contact us to put your e-commerce business on the right track!
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