How AI Is Changing Ecommerce Accounting — Barbara Malisz-Talha | What Bad Data Does To Your Finances, Why Multi-Channel Selling Creates Messy Data, How To Use Automation To Clean Up Your Books, Why You Need A Single Source Of Truth For Data (#431)

In this episode, we explore why many e-commerce brands struggle with tracking their finances and what they can do to fix it. 

We are joined by Barbara Malisz-Talha, Product Manager at Synder, who shares how her company helps businesses turn messy, complex financial workflows into clean, intuitive automation. 

She explains the risks of "flying blind" with your numbers and how automation, AI, and proper data management can provide a clear, accurate picture of your business's financial health.

Try Synder free for 15 days. No credit card required: https://partnerstack.synder.com/veib7ht5fu87

Topics discussed in this episode:  

• How to avoid driving blind with your business's numbers. 
• Why multi-channel selling complicates financial tracking. 
• What messy data does to your financial statements. 
• How to handle multiple payment processors. 
• Why automation is key to accurate bookkeeping. 
• What to do when reconciling different data sources. 
• How to onboard and clean up your finances. 
• Why a cash settlement is not the same as revenue. 
• What AI brings to the world of financial tracking. 
• How to use financial data to optimize your business. 
  
  

Links & Resources 

Website: https://synder.com
Shopify App Store: https://apps.shopify.com/synder
LinkedIn: https://www.linkedin.com/company/synder/posts/?feedView=all
Facebook: https://www.facebook.com/SynderHQ/


Get access to more free resources by visiting the show notes at https://tinyurl.com/c3cjjdb5

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Transcript

00;00;00;00 - 00;00;21;29
Unknown
Biggest issue could be simply that you just driving blind. You have no idea what's happening, how much money you have. How much? What? Are you even profitable? Maybe you will not even have the cash to buy your next batch of inventory. And the complication happens if you have your order in Shopify being paid by PayPal, or maybe have PayPal, have gift card and that is where the complexity lies.

00;00;21;29 - 00;00;29;03
Unknown
The money that lands in the bank, that's your cash settlement and not the revenue and not the site. That is a big problem. Why is it the problem?

00;00;31;18 - 00;00;51;15
Unknown
Hello and welcome to another episode of the eCommerce Coffee Break podcast. If you're selling across multiple channels, you probably know the feeling. Your bank account balance doesn't line up what you thought you are making numbers look good in one place, but in reality it is a different story. Today, we want to find out why so many ecommerce brands are flying blind with their numbers and what you can do to fix it.

00;00;51;17 - 00;01;15;24
Unknown
Joining me today is Barbara Malisz-Talha. She is the product manager at Synder, where she helps accountants, bookkeepers and finance teams turn messy, complex workflows into clean, intuitive automation. So let's get into it. Hi, Barbara, how are you today? I saw how you like to buy. Why do ecommerce brands often struggle to track their cost, sales, and cash flow accurately?

00;01;15;27 - 00;01;36;14
Unknown
So, one major thing is that it's simply quite hard to do if you're trying to do it by hand. And if you want to look at your spreadsheets and put all of that, it's just simply a lot of work. So I would say that is one of the major reasons that is just very time consuming. Automation can help obviously, with that.

00;01;36;14 - 00;01;54;24
Unknown
And that's it takes one element of it. But then you need to also do it accurately and align with your business. And what do you do? So I would say that's another step that even if you're doing this with automation, you need to do it in a way that's, that suits your business and what you're trying to find.

00;01;54;26 - 00;02;26;07
Unknown
I think the header comes in if you're going multichannel and then you have multiple data points. Data coming from different versions. The reporting might be different. Tell me a little bit on how financial tracking is influenced by messy data. So that is a big problem. Why is it the problem? Because it's not only the fact that you sell on multiple channels, which is a big problem in itself, because you can have, for example, inventory that it's held in one place, but you're selling it in different places.

00;02;26;07 - 00;02;41;28
Unknown
So you need to keep it, like the inventory stock has to, you know, adjust to each other as you, as you have it. And you need to have a source of truth, which should also be your accounting. But it also means that, for example, if you sell on Shopify, but you are having payments coming from different payment processors, right?

00;02;42;05 - 00;03;05;02
Unknown
So for the buyer, this seems just like buying it on Shopify. And that's just that. But for the seller that means handling Shopify. Maybe it's PayPal, maybe it's up to pay. It depends how many different processes you have. And the complication happens if you have your order in Shopify being paid by PayPal or maybe have PayPal have gift card, and that is where the complexity lies, is that you need to accurately book it.

00;03;05;03 - 00;03;23;26
Unknown
Because if you just connect your Shopify, your PayPal, and let's say an Amazon and you've all connected together into your accounting, you will have duplicate entries because the the payments that are coming from PayPal for Shopify orders will be booked as certain transactions, and the orders will happen the same. So you will have a, a lot of duplicates.

00;03;23;26 - 00;03;44;05
Unknown
So that's why the complexity is there, not only with different channels, which you need to track and have it as a one source of truth, but also with the payments and matching them? So this is the biggest issue. Now a lot of DTC business e-commerce business out there are cash flow driven. And you mentioned as different payment providers that probably have different terms when they pay you.

00;03;44;08 - 00;04;08;08
Unknown
And that can be a huge risk to your business. Can you give me an example on sort of the worst case scenario, what happens to brands if they don't track their numbers? The biggest issue could be simply that you're just driving blind. You have no idea what's happening, how much money you have, how much, whether you even profitable, how much you're going into expenses.

00;04;08;11 - 00;04;31;23
Unknown
Maybe you will not even have the cash to buy your next batch of, inventory. How you inventory is moving. There is a lot of things that you just can't even understand. Where are you going from here to there? So I would say it's like, that is just like trying to go to one city to another without a map and just thinking like, you know, like you don't even know where do you go down south or anywhere.

00;04;31;23 - 00;04;49;12
Unknown
So, you know, like chances you get there. It's it's low, but you need to you need to know these numbers. Yeah, absolutely. Rides for flying blind is not a good idea. And I think specifically growing e-commerce brands who are taking new apps on their and new channels on there. At some point in their growth journey, they are at a point where they lose.

00;04;49;12 - 00;05;09;12
Unknown
Overview. Now, even though you're helping with set, automation obviously is the key there. Tell me a little bit on how automation helps brands in solving this problem. So when it comes to getting your sales, because that's the first hurdle, it's that you have your sales and your sales channel, the payment processors, and you want to get it into accounting.

00;05;09;17 - 00;05;33;03
Unknown
So this is what's into our HubSpot. It gets that data from one place to another. Like with this example of a car. But, this isn't just a simple thing of taking it. Because you could say that, you know, you can maybe, download some data and upload it, but that's not really what you would like. And this is not helpful because you need to get it into the right places because it's not, single transactions.

00;05;33;05 - 00;05;54;11
Unknown
For the buyer, for example, they just paid. That's what the seller this means your the taxes also discounts. There are the payment part and there is the revenue and so on. There is could be chargeback refunds. There is plenty of different elements that as a seller you need to book. So when you have that for or payment it has to be split into different parts.

00;05;54;14 - 00;06;28;17
Unknown
Then what happens? And this is what scenarios helps with just splitting normalizing that data. But here is a key element that this data is not only supposed to help you stay compliant, for example, with the Texas regulations and so on, but it's it's there to inform you about your business. So, for example, if you have, you selling some items, on in different locations, different sales channels and so on, maybe you have different products and you want to, split them into different income accounts, which is what, you know, many sellers would like to do that happens here in.

00;06;28;19 - 00;06;47;06
Unknown
So we are mapping your account so you can not bring yourself however you like and then you can split it. You can do it by regions, by locations, by type of, you know, like if there is a word such and such in there, put it into this. And that allows you to have your, your financial statements in the way that makes sense to your business.

00;06;47;08 - 00;07;12;12
Unknown
So I would say that is the second point. So it's not just moving part and splitting it, but then putting it into the right place. And that's something that you cannot do if you just download and upload, which isn't really a possibility because it needs to get into different accounts. So you can't really do that right now. Talking about the tech stack that a lot of brands out there have have there.

00;07;12;12 - 00;07;31;19
Unknown
There's a lot of different apps they use. There might be, I don't know, there might be used Xero or QuickBooks. They have different warehouses. How do you pull all this data together? So what do we do? We sit somewhere in between. So you have on one hand, you can have your sales channels when you sell.

00;07;31;19 - 00;07;54;19
Unknown
These could be marketplaces, like Amazon, Etsy. We support about 30 different, we connect with different, integrations. And that includes sales channels, payment processors. We have also integrations with the inventory solutions and with, accounting software. So we are sitting right in the middle. So we take all that data in and then we are putting it into the accounting.

00;07;54;21 - 00;08;27;13
Unknown
So we work with QuickBooks online with zero with puzzle for like smaller sellers and for the large ones with Oracle NetSuite and with sage, in fact. So we are not replacing any of these things. We are just the, the and middle part, which is just doing this, this, data segment, I would say, obviously as, as a merchant, you want to have a system that sort of proactive obviously, is thinking all the data, on a day to day basis, what would my day look like when I'm working with Sinda?

00;08;27;15 - 00;08;46;29
Unknown
So, a we have different modes, which means that it is up to you how you would like to have your data set so you can have it sync as individual transactions, which means that every payment, every invoice will be sync as individual and ensure you are having you know, your customer names, product names and everything that is.

00;08;47;01 - 00;09;12;15
Unknown
And then the biggest detail that there is and you can split it even further, you know, by different classes and so on. Or you can have it as a summarized entry and this could be like a daily entry, or it could be even monthly. We have, payout entries which are, journal entries, which means that all your, different lines are summaries for a specific period, let's say, for a date.

00;09;12;18 - 00;09;30;28
Unknown
So you will have, and here also, you are splitting these things. So you're not losing that possibility to categorize, for example, your income, the way you like it. So for example, if it's a, income for a particular product, this particular thing will be clumped together and all those sales for that date will be put in there.

00;09;30;28 - 00;09;51;16
Unknown
So there is a, like a, like a version which is kind of combined. And this happens when you would like to, when your business is growing, you're having more and more sales and you would like to kind of not and stroke your, accounting with thousands and thousands of different, you know, like, information for individual transactions.

00;09;51;16 - 00;10;10;02
Unknown
But you want to kind of have a very good overview of your financials that's not put this very, very detailed data over there. So here, when it comes to how often you have it, this is a difference. Because if you are doing it on the first one then they are just being just as they're going through your processes, they get in sync automatically.

00;10;10;02 - 00;10;26;00
Unknown
You are setting this, you can set it auto sync or you can sync it yourself. So they're just getting sync. And you just everything happens in the background. You don't have to do anything. And if you are doing it, with the daily or monthly, then you are just setting it. Your, you know, like your periods, how you would like to do it.

00;10;26;00 - 00;10;43;29
Unknown
And you can also always do, manually, but you can also send it. And when the summaries are ready then they are being pushed into your account. So so that's how it works. Now let's add a little bit more complexity to a already complex topic. A lot of brands out there are selling internationally. Are we talking about currency.

00;10;44;06 - 00;11;04;16
Unknown
How does that work. So multi-currency is is a big thing. And you know, as you said that more and more sellers are doing it. So we are handling like a sender. We are handling it, with different currencies. So you simply are having different accounts and which is the practice. You have the current accounts for different currencies.

00;11;04;23 - 00;11;20;14
Unknown
So for example if you have the summarized entry then you will have it for for your different accounts. You will see that there's ability for they. So they are not being, you know like kind of together that you cannot see it because you need to reconcile. So, so that's, that's how it is. So this is all handled is just separated.

00;11;20;14 - 00;11;46;20
Unknown
The separation is the part that helps you with this. Okay. Now the part that probably interests a lot of our listeners is, data protection. We're talking about a lot of different connections, sync and API's there. How does, sender support data protection acts and what comes to all companies like ours need to go through different, and, like, elements that ensures that.

00;11;46;20 - 00;12;05;14
Unknown
And one of them is such a compliance, which we, which we have and we have all other validations and things that are, that are there in place, so, so this is all like a standard procedure. So we are, you know, covering that all the time because, you know, this is a financial data. So you can't, you know, like play with it.

00;12;05;14 - 00;12;25;23
Unknown
This is, this is something that has to be, you know, always together. So, yeah, let's talk about the onboarding process. If somebody comes to you, they might come to you and they have a complete mess. I reckon it happens more often than not. And how do you help with that? Can you give me an example what the, onboarding process looks like?

00;12;25;25 - 00;12;44;06
Unknown
Sure. So. And our onboarding process, it's like I would say the first stage is relatively quick. All you need to do is just have your information about your business, just the simple ones. And then you need to have credentials to all your platforms that you want to connect, and that includes your accounting and also save time sometime processes.

00;12;44;06 - 00;13;00;24
Unknown
So you need to just connect it to a center. Once you do that then you get into center. And here you can have your first batch of transactions. Important because you can have them already sync. But it is, I would say, advisable to first see how they look like just to get get an idea of what you do.

00;13;00;27 - 00;13;24;08
Unknown
So you're getting all your data imported and that's that's happening. You know, like technically this is after onboarding, you could say that you are already in however, this is when the the second kind of batch of work happens, which is finding your best fit when it comes to different settings. So how do you like your transactions to be, synced and what would you like to sync and on what kind of basis.

00;13;24;08 - 00;13;47;00
Unknown
And here you can make your products. You're putting all the accounting mappings, groups, classes, many different aspects. So this is what will also happen during the onboarding and for the higher clients like a client premium we having this with the onboarding specialists. So all this happens with our help. And because the larger the business the more complex these things are.

00;13;47;00 - 00;14;07;08
Unknown
And like our ideal customers are those that have complex needs. Like, you know, this without that and partially this and so on. So, you know, many different complex offices, this is what we do. So then we help you set everything up. Let's talk about complexities again. If it's complex, one word comes into my mind I artificial intelligence.

00;14;07;08 - 00;14;26;13
Unknown
Is that something that you facilitate to something that you use. So yes. Like I it's these days everywhere. So yes, it is something that we are doing and I is also coming into the finance world into, you know, again, in a real sense, so yes, we do have some elements which are supported by AI. We do have like a AI dashboards.

00;14;26;18 - 00;14;42;08
Unknown
So you can, for example, ask questions. I don't know, what were my sales for New York. And, and I don't know August. Yes. And you just put things that and that becomes a dashboard. And these are the dashboards that you can create yourself. So these are like widgets that you just kind of place it. You can you can pre map them.

00;14;42;08 - 00;15;08;08
Unknown
So it can be something that you find, important to you and you just put them there. And so for example this is how we are using AI also in things like you know like some kind of chat boards and things for simple questions and, and the, the capability of AI and how we are using it, it's, it's constantly evolving and we're thinking how to do it best in a way that makes sense because, you know, it's it's easy to just say, oh, let's do it with AI.

00;15;08;08 - 00;15;25;11
Unknown
But the thing is that this is finance. It has to be, you know, like perfect. It has to be accurate. So, you know, like if you're saying that something isn't quite right, when it comes to, you know, like, financials and you need to be sure. So we are also cautious, with, how we using AI?

00;15;25;13 - 00;15;45;14
Unknown
And to make sure that this always when you know what the best value for these assets. Now a lot of founders, startups, they know bookkeeping is important, as you said. And you have a background in psychology. So you know that there's different kinds of people, and some are more creative and some are more of a better fit for bookkeeping and straightforward.

00;15;45;17 - 00;16;05;00
Unknown
Do you have a story of a brand coming to you where you really need you to take over with the onboarding process and get it streamlined? What's what's your, sort of approach there? Yes, I like, of course, as you said, it really depends on the person. Some people, prefer to do a lot of things themselves. They are the client who, you know, like, I think, understand what's happening.

00;16;05;00 - 00;16;39;01
Unknown
I need to know what it is. Especially that happens for accountants who have, you know, like, immense knowledge because some of our, customers are business owners, but also either they having their accountants on board and they are the ones that we are having, like, for example, onboarding process. So, so that's what I would say that are some of which would prefer, understand everything and do everything ask themselves or they are those, and business owners and we have many of those who prefer like onboarding when we are taking them through each and every single step and explaining because it is complex.

00;16;39;01 - 00;16;57;11
Unknown
So we totally understand it. So there are many of our users who who came in and who did not know, you know, like they just gave us the books, we saw what it is. And then we did, for example, a historical import of, a very large period and then numbers before they didn't tie up at all. And then we kind of cleaned it up.

00;16;57;13 - 00;17;13;15
Unknown
We doing like monthly health checks as well for them. So you know, so that's that's kind of helps them out. So so there is a lot of stuff. So when you're coming it's not only that everything starts from today. And that's when we were looking at your books. We're looking them backwards. And you can can have historical imports.

00;17;13;15 - 00;17;36;14
Unknown
And then also you know like sort these things out there to, who's your perfect customer? E-commerce business owners. What complex needs I would say this is our number one. So the similar complex provider. So, yes, everything that's hard and difficult, this is what we do. But also accountants, and we also, service businesses.

00;17;36;17 - 00;17;57;00
Unknown
So tell me about the pricing structure. Is it an important question? How does it work? So our pricing structure is based on two things. One is number of sales transactions and another one is a like a feature set. So the more transactions you have the higher you move up the pricing. But also it goes together with with features.

00;17;57;00 - 00;18;30;14
Unknown
So because the smaller business you have, you don't need that much, you know, like different passing on different small elements. But the bigger business you have the more needs. And you would have so. So that's also those talent. Yeah. Definitely very important to have an overview of what's happening in your business and getting the numbers right. Not only for tax reasons, but obviously you want to know what the money in the bank if it's really yours or, if there is more, costs coming into it now before our coffee break comes to an end, is there anything that you want to share with our listeners that we haven't covered yet?

00;18;30;16 - 00;18;59;15
Unknown
What you just mentioned right now, I think it's, super crucial, which is like on one hand, you want this data to, be there for the tax reasons. But for the business owners, it's like, how much do I earn? How much are my expenses? And to understand that and there are many things that I would say that are might not be obvious or we have noticed that the business owners are finding, difficult or they do not see like, how does that all kind of, ties in together.

00;18;59;15 - 00;19;14;21
Unknown
So one thing I would say that the money that lands in the bank, that's your cash settlements and not the revenue and not the sales. So, for example, we see these sort of issues when when the business owner will say, okay, this is this is what I, this is the money that I got, which is true, but this is not the states.

00;19;14;21 - 00;19;36;14
Unknown
Right? Because all the fees and refunds and chargebacks were already taken up. So that's what I would say. Another element would be to do with reconciliation, which is a huge pain that, we noticed that when we, we're dealing with our customers and especially when dealing with their accountants who are dealing with the customers, that what do you reconcile against?

00;19;36;16 - 00;19;56;06
Unknown
It's different for different people, which is that's someone can have exactly the same books, exactly the same business. And I'd say too, it's but they reconciled that against this one and that one against that one. And it's just as long as you're doing it by the correct one, this is okay. But the correct one can be different for different businesses, and that's totally fine.

00;19;56;11 - 00;20;14;18
Unknown
So that is also one thing we see. With Shopify, for example, when you are having these payment processors and then you having those, those and cash settlements and you have those numbers, it can happen, for example, that the number in this in Shopify for let's say, payable is different than the one in PayPal for five. Right.

00;20;14;21 - 00;20;34;24
Unknown
So then you need to know which one to use. And you do need to use the one which is actually in PayPal because that can be sometimes small differences. But still, you know, when finances all matters. So you will have and some differences that you need to see. And over there you can reconcile as well. So I would say these are the kind of, elements that sometimes can be missed.

00;20;34;27 - 00;20;54;19
Unknown
So, so on this on the same way, it's like when you, having your fees, categorizing the fees, we would say it's also very important, like, if somebody has a business and Amazon, Amazon FBA, you have a lot of different types of things. So to understand where your money actually is going, you need to see where it is because there are certain fees.

00;20;54;22 - 00;21;13;01
Unknown
Sure, you can't do anything about, but there are some that you can, for example, those when it comes to that, long storage. Right. Like if you understand. Okay, I am paying every month that this particular type of fee, then you can then do something about it and do something with that stock, I don't know, maybe get rid of it or, or do some kind of sale.

00;21;13;04 - 00;21;40;06
Unknown
So in the same way that's this financials are there to inform you and help you, you know, like manage your business better not only on the income part when you can see how my business is growing and and which part is growing, but also how what kind of expenses do I make and then have that split, because we can also like provide these other elements that, you know, like if this fee has this sort of name, then put it into this and then you can just split it, you know, however small be mine.

00;21;40;06 - 00;22;04;14
Unknown
So I would say this is the kind of element I would say that, that it's also important. I appreciate that you highlighted that having automation of background data to be just compliant to standard bookkeeping procedures, but also to optimize your business over time. So not only your startup, but also established business can find ways to optimize their financials through automation, through a proper system in the background.

00;22;04;14 - 00;22;23;04
Unknown
So I think that's very important for our listeners to know, this is not a system only to get started. That's something that grows over time and gives you more benefits over time as you grow. Where can people go and find out more about you guys? So you said, can I where can people go and find out more about you?

00;22;23;06 - 00;22;46;01
Unknown
And so, it's our company center, so it's a central.com if you want to come to the website when something's coming. Also the different, conferences like, so you can like the one that you can use and would be it would connect at the end of October. So, so it's these I would say are the places and we are also in many different marketplaces.

00;22;46;01 - 00;23;16;21
Unknown
Is that the Shopify? Is it the, Clover and so on. There are many marketplaces that since we, are there for like different 30 plus different, providers. So those ones who have them, we are there. So you can also, I understand you offer a promo code podcast 150 to our listeners. What's involved in that? So, this is a promo code is, podcast 150, where you can redeem this, at any single product that you buy, whatever it is or product or any sort of add ons.

00;23;16;29 - 00;23;42;27
Unknown
It's, worth, 150 USD and you can redeem, and just put that coupon. It will. Perfect. I will put all the links and the coupon code in the show notes. So then this will be just one click away. Or a lot of people reach out to you and test Sinda. I think it's crucial to have a system in a background that helps you with all these data points, and make sure that you really know what's going on in your business on the financials.

00;23;42;29 - 00;23;53;06
Unknown
And, I think you gave a very good overview today for our listeners to understand why it is so important, and I hope a lot of people reach out. Thank you so much for the show today. Thank you so much for having you

00;23;56;02 - 00;24;14;12
Unknown
Have.