June 23, 2022

Do you know Quickbooks & Shopify? with Liz Scott - Quickbooks Online ProAdvisor

By Veronica Jeans, Ecommerce Queen
Virtual Ecommerce Summit 2020 | veronicajeans.com

Hi, I've got Liz Scott with me, she's the QuickBooks online lady as I call her. And she's absolutely amazing. She knows all about how to get to QuickBooks online, how to integrate it with Shopify or any other e-commerce writers and why we should actually have QuickBooks, right? Because QuickBooks sounds so complicated, but Liz - you introduce yourself and tell us exactly what you do and then why should we use QuickBooks?

Liz Scott (00:33):

So those are all really good questions. So I'll start with - my name is Liz Scott, and I've got an accounting firm that is located in Oklahoma. And the majority of what we do is virtual. So really location doesn't matter anymore, but I'm an advanced certified QuickBooks pro advisor. And what that means is that really our accounting firm is focused on businesses who use QuickBooks. And so anytime that you've got a suite of solutions that also connect to QuickBooks, that's going to be an integration I'm going to help with. So we have really taken the idea of selling online and really try to streamline it and make it where the business owner actually can make some sense of it in the bookkeeping.

Veronica Jeans (01:20):

Yes. When I had my my previous business, I had QuickBooks and QuickBooks financials and I never looked at it. I could just barely dabble in it. So I'm like a typical, small business owner - like, do I have to do this? You know, but the bottom line is you need to know what your numbers are. And so the ease of QuickBooks online with Shopify - because it is all about Shopity today - is it is extremely easy, right?

Liz Scott (01:53):

So I would say yes and no, I would say that definitely the reporting matters, but is it always easy? No! So that's where I love coming in and I like being part of that solution. And honestly, one of my favorite type of engagements is whenever somebody tried to do it on their own and they've ran into a roadblock, so they ran into a wall and I come in and I'm able to help move them past that. And so that's, whenever you get those shiny, you know, light bulb, happy moments, whenever they can actually look at their reporting inside of QuickBooks and actually make some sense of it. And, you know, I feel like part of what I'd like to kind of share is what I share with my clients. So whenever they start selling online, whether it's because the brick and mortar soap store is closing down and they'd like to be able to have some flexibility or if they just want options.

Liz Scott (02:52):

So I have clients that have still a brick and mortar and they're online and they're going to these different locations and want to be able to be mobile. And so that's whenever I say, okay, let's look at Shopify for that solution, because Shopify does the thing where a lot of online solutions don't always have all the pieces, the components together. So what I mean by those components is being able to put in your inventory so you've got your quantity. Being able to look at what your cost is and what's your sell prices. And then being able to look at you know, how that data goes into QuickBooks really matters because Shopify is going to be the place where you could actually charge your sales tax. So if you tell QuickBooks, I want you to use my location to charge sales tax - well, that's not really where the point of sale is happening. That point of sale is happening inside of Shopify. And so, you know, one of the things that we want to do is we want to pull that data out of Shopify and push it into QuickBooks. And that way that sales data becomes useful data.

 

Liz Scott (03:58):

And that's exciting. And that's that piece that I enjoy being part of, because somebody like yourself is going to come through and help set up the Shopify account. And then somebody like myself is going to come through and say, - that's all you, you can have the Shopify part.

 

Liz Scott (04:16):

Somebody like myself is going to come through and say - Okay, I know enough about Shopify to be able to say, does this look right? Is this accurate? And then the next thing I do is be able to say, how do we make this data go into QuickBooks? And where I have seen a whole slew of issues is if you push all of that data, it can become a bookkeeping nightmare. I recommend using a third party solution to do that.

Veronica Jeans (04:45):

So why do you that?

Liz Scott (04:47):

Why do I use a third party solution? Well, because you get to have control over the mapping of how it imports into QuickBooks. If you think about those, solutions - here I've got my Shopify and here I've got my QuickBooks - there's a wall in between this whole space. And so those two are not naturally talking to each other. So you got to put something in there. You know, a middleware is what they call it, or I call it glue. So we put the glue inside and then you can map, how do you want that data to come over? My preferred way is to come in daily. And so to have one daily summary and what that means for somebody like myself is that whenever I'm wanting to accomplish good bookkeeping and good accounting, if you bring in a summary of data, you can say, here's my daily payment method for the day. And then that sum of money is going to then match your QuickBooks deposit, which is tied to your bank. And then those are those little victories that you have. It's like, now you have each piece of this, your Shopify, your QuickBooks, and your bank account, all matching. That's whenever you can pull in those reports and they mean something, you know how much you sold and you know how you're doing.

Veronica Jeans (06:04):

We have one little customer who has a boutique and she's got an online store. So Shopify, - see if I'm correct or not - they put the money into your bank account as one sum. That is it. You get the sum for the day or however they pay out. So you don't really know if you sold it on your POS system, your point of sale system or whether you've sold it in your online store. Right.

Liz Scott (06:39):

So that's true unless you use one of these middleware software. Te middleware software can actually go in and it can look to see what that brick and mortar, and there's a tag to it. There's a tag to that sale. That's exactly what you're talking about. So that tag to that sale is able to say this was brick and mortar. And so that brings it in, on your financials as the brick and mortar, and then the other tag would be the online point of sale. So then you're able to know, well, this was generated from my web store with Shopify.

Veronica Jeans (07:10):

Exactly. I had Amy our sales tax guru on as well. And we were talking about at some point - and everybody's happy to come to this point - you have to start paying sales tax into every state. Does the reporting then flow through to QuickBooks so that, you know in what States you would get to certain level or does it not. That was one of the questions we were asking each other, actually.

Liz Scott (07:51):

So I think that's a really, really valid question. And that's an area that I come in and I say, let's go to the source of truth. And that's going to be the Shopify account. So let's go pull those reports because that actually has all of the details of that sale. What is the ship to address? What is that actual pinpointed location? And so that's going to be the report I would recommend. And again, that comes due that summary that I'm talking about pushing into QuickBooks, instead of having each one of those transactions coming in and creating this nightmare, a collage of all of this data. What do you do with it. Instead create this really clean summary that you can say, I can see my sales data. I have a summary of all of the sales tax that's collected. What is my liability for the day? And that builds your liability and that's based off state or whatever your locations are.

Veronica Jeans (08:45):

Shopify is expanding and adding new capabilities as we speaking. Since I've just practically finished my book and I can already do an update. So it's like, I'm never going to keep up. But I actually did the Kindle version. And then I decided, I guess, so now I have to do the, the printed version. And obviously you're on the boat. This is a working boat, but I did the the printed version. And it was practically all yellow because it's all changing. Why I'm mentioning that is now under products you can actually add your cost to the product page as well. So here's the thing if you don't know your fixed costs and your variable cost, then that profit is not going to be a true profit, right. So, if you have QuickBooks, then you will really see what your profit is.

Liz Scott (09:49):

Exactly and I would even take it one step further to say that whenever you're using these middleware solutions, you can pull in, you know, what are my selling fees and if you want to advertise on Shopify, that's great. Those are great options for you. But each industry, each area has different fees. And if you want to see those, there is a solution out there to get that data into QuickBooks.

Veronica Jeans (10:17):

And this is what I stress as well with any of my clients that you got to know your bottom line. You got to know how much money you're bringing in, because from the profits, you should be spending at least 25% on marketing, which a lot of people don't do. They just go, I've got this money and I'll use this tiny little bit for marketing. I was just chatting to somebody and he said that he spent $50 on advertising and he sold a hundred dollars worth of books. So he made $50. But if you didn't do that, then he wouldn't make anything because you know, organic right now is like 2%. So you have to start advertising. So now Shopify have also implemented for instance the marketing aspect of with the products and everything. Will that pull into QuickBooks as well, the amount of your spend or not?

Liz Scott (11:28):

It is going to come in as a fee, but it's really that middleware that you're using. You're mapping it. And so essentially what's happening is all of the Shopify data is coming into that middleware. And then based on the way you map it, it churns it, and it sends it over into a streamline summary. And I think that you make a really valid point whenever you're talking about marketing - Oh, that feels like it's going to be so much money to spend! But I mean, ideally if you could say, I'm going to spend $25 and I'm going to have a hundred dollars in sales. So maybe you made $75 because there's no overhead. Let's just pretend that. Well, what if you said, okay, this is working, I'm going to take that same 25% and let's add some zeros to it. That's where it gets fine. So if you can see the value in marketing, that's whenever you go - okay, this is worth it. But if you can't see its worth, you can't prove it to yourself.

Veronica Jeans (12:27):

So here's a good question. We have a lot of startups. And so with a smaller businesses you're still working on the spreadsheet. Although, I had a $2.3 million million business, and I was doing mine on a spreadsheet with QuickBooks. I love my spreadsheet because it makes so much sense. Should you do it from the beginning? Because really it's not expensive, right? QuickBooks is really not expensive. It's like $14 or something. I didn't realize this until I actually had a look. So, I mean, for $14, you can have something that you can give to a bookkeeper or somebody that can make sense of it and then extrapolate your taxes and your income and what you should be paying on taxes, et cetera. Right. So when should somebody do it?

Liz Scott (13:20):

I agree with you that that QuickBooks can be inexpensive. And I would say that there are some options in QuickBooks, you know, which version should you get? And there are multiple different versions out there. And, you know, I would even say that somebody like myself who is a pro advisor can offer 50% discounts. And so that's whenever you go - Hey, this is a $70 solution and now all of a sudden I'm getting it for $35. My ideas are, go ahead and get that $70 subscription - QuickBooks Online Plus is what they call it - because you're going to get some more reporting. You do get hundreds of reporting abilities whenever you get into the higher levels of QuickBooks and when should you get it - when do you want to see your financials?

Veronica Jeans (14:09):

I know, but and I want to stress this point as well. And I've spoken about this to Joey, the trademark lawyers, when we spoke today as well. The whole thing that I maintain is when you're starting your business start it the correct way, because if you don't do that, doing it afterwards is a pain, and it takes so much time. Go to a business lawyer and go - Okay I've got one hour and I've got all these questions. No chit chatting. I use to do it all the time. I would write everything down so I can remember. This guy had to be on the ball. I know Liz, you do consulting as well, and just go in and say - Hey, you know just check if I've done everything right. You don't have to have a monthly fee. Obviously we all love monthly fees, but still if it's set up the correct way and when you really do need Liz, everything she knows is just done the correct way. When it's not done the correct way, it's just such a big mess to sort out, right.

Liz Scott (15:25):

I agree. And what makes me laugh is I'm thinking about my son, who is a tuba player. So he's a middle-school tuba player. And he started a band at school. He was with a group of people and they really weren't able to give him one-on-one critique. Well, then we decided, okay, he actually really loves this and he's got a knack for it. So we gave him some private tutoring and, one of the things that his tutor does is literally has a ruler and it's like, you're fingering wrong. And he doesn't hurt him, of course. But at the same time, he's like that action of telling you to stop. He said, it's really hard to learn something in a group where you're not really able to get the details and then later reverse those bad habits. So I think that if you go into something in the very beginning with - Okay I don't know how to set it up. Somebody like myself would come in and set it up and you do just a little bit of training. Then we wave goodbye. And what I call myself as somebody who meets businesses in transition.

 

Liz Scott (16:40):

There is no graduation day where they don't need me anymore because I know that they're going to come back with a tricky transaction or they're going to say - Ive grown again, or I'm in another transition.

Veronica Jeans (16:49):

Yes, Exactly. And I've seen messes, I've seen where I just go - You've gotta be kidding me . I've got to fix this? They've got things all over the place and four or five different platforms. The reporting is terrible. And the apps that they're using is costing them a fortune. But you can solve the problem and bring those costs down so much, because literally everything you spend is an overhead on a product that you are selling and is less profits that you're making. So you got to look at your whole business and then start it correctly. In my previous life, I used to actually set up businesses in America from overseas. So I did everything. I did the accounting, the businesses, not the accounting actually didn't set up an account, but I did set up the bank. Getting the bank accounts and all the government stuff in for the business and setting up the files and forms and whatever, and getting in the experts to come and set it up correctly.

Veronica Jeans (18:02):

So when they started the businesses they can walk in and the business goes. So I've learned that you just have to do it the right way. You've got to have a budget when you're starting a business. I don't care what anybody says, especially when they're saying, you can start a business and just sell stuff. I've seen it. I've seen them do it wrong way and getting into trouble, especially when you're talking about taxes. You know that the government and the state, they want their taxes, they want the money. It's not your money, it's their money. So all of those little bits and pieces have to be set up correctly. And one of the good habits, and I'm sure you agree, is to have that money, that sales tax money go into a separate account. So you don't think you have a lot of money.

Liz Scott (18:56):

Well, some people do that and you know, other people are just like - Well if I'm going to pay it monthly, fine, whatever. But I agree with you, no matter what, those taxes have gotta be paid, there's nothing that shuts a business down more than tax penalties.

Veronica Jeans (19:10):

Yeah. So fast. So what advice would you give somebody? Because we've talked about the beginners. So I have a few clients that are already in business with quite a handful of products, or some of them have only a few products. What would you recommend?

Liz Scott (19:31):

So recommendations for next steps?

VJ

Yes - they don't have QuickBooks?

LS

Yeah. Okay. Well, somebody like that, I would say - You're ready.

Veronica Jeans (19:42):

You are amazing because you've helped a couple of my customers. And as I said, she really was struggling with a bookkeeper that was charging her $1000 a month, to which I said - You are absolutely crazy. Not even lawyers charge that much. So that's where I recommended you. You sorted her out very, very quickly. She was already at the quarter million mark. She was starting very late and she was always behind and not doing the reporting correctly because she didn't have time. So I don't know what the other lady did. You have to talk to the right person to help you. Shop around, right. You can't just go from - Oh, you know what, I know a bookkeeper that can do my books. There's a difference between an expert and a bookkeeper. And I don't want to put them down, but it is a different expertise. Right.

Liz Scott (21:04):

I agree. And I also think that the role of the bookkeeper is changing at this point. So there are some bookkeepers - they're amazing. So not knocking them at all. The thing that I would say is if you're looking for somebody to work with QuickBooks, then I would find somebody who does that. There's various ways that you can do it. You don't just have somebody who I've seen lots of cleanups that I had to come in and they hired somebody who said, I know QuickBooks. And they used it maybe once, and maybe they use the desktop version and they're now on QuickBooks Online. So that person was like completely overwhelmed, afraid to say something because they wanted to keep that job and it was months before the owners figured out that that person didn't know their job.

Liz Scott (21:47):

So,somebody like myself has come into those roles and either one trained that person, because they were a good fit in all of their areas that they just needed some training. And then the other part is, if you want somebody who's outsourced like myself you know, you can go to findaproadvisor.com and you can search for somebody who works in your industry. So you can even get industry specific. And then you can find somebody to work with. Now, I would say, you don't have to, because it does use a location. So it's going to try to partner with you, somebody who's nearby. I feel like that's less important now in an online world.

Veronica Jeans (22:26):

My tax accountant is in Houston, but he's still an hour and a half away. I never see him. I've known him for eight years. I never see him. I saw him once when I signed up and that's it, everything these days is online. And I also know that QuickBooks Online services you could do anywhere in America, right?

Liz Scott (22:57):

Yes. You know, desktop is the same way because there's all these online solutions to both make that QuickBooks feel like it's online. It's not quite as smooth a transition. You know, one of the things that QuickBooks Online does is it has this open API. So that way it allows for all of these different solutions to essentially write code and then be connected to QuickBooks. So they have this open platform where they are asking developers to come in and create these apps, and then they have to submit them for review. And it's a really, really strategic process for them to be able to get listed on apps.com. But that's the place to go whenever you're looking for an app to connect to QuickBooks, to go and see, is it, certified? Is it one that's been approved?

Veronica Jeans (23:42):

So, quickly, the difference between QuickBooks Financials and QuickBook Online. I spoke to both and the QuickBooks Online department do not speak to QuickBooks Financial department, and they have no idea what each of the products do. So I was in the middle of this migration and I didn't know you, by the way. It wouldn't have been painful, but I was amazed because it was all QuickBooks. Right. So the difference - and I know one is desktop, and one is online, but

Liz Scott (24:16):

Exactly. So, that's number one, the biggest difference. And the other one is if you think about QuickBooks as being a subsidiary of Intuit and Intuit has all of these different platforms. So you can have the merchant service provider, which is QuickBooks Payments. And then you can have QuickBooks Payroll, you have QuickBooks Payroll Online. I mean, you have all of these different suites of solutions. And so that reporting feature is one of them. In QuickBooks Online, they have multiple different kinds of apps that you can have. The QuickBooks Online Advanced has got a connection to a really robust reporting tool that feels similar in a way that QuickBooks Reports works, where you can actually merge different entities if you need to. So it really depends on what kind of reports you need and how deep do you want to go?

Veronica Jeans (25:10):

So if I had two or three Shopify stores, would they then be connected to one QuickBooks Online.

Liz Scott (25:21):

Are they the same federal ID number? I think that's the thing that's important.

 

Liz Scott (25:31):

You want to have merged financials. So, you know, with Shopify, I can actually go through and have multiple different channels. So you're thinking of a client that actually sells in the United States. They sell abroad into other countries. And so there's different areas that they have to have, even with Amazon. So they have different locations in different sales channels. So these different solutions that are middleware, you know, there's probably 10 of them that are really, really good middleware solutions. And so you decide how many different sales channels do I need to push into QuickBooks, and then you can decide how to map.

Veronica Jeans (26:06):

That makes sense. Because I know Shopify has just added Walmart, which is not as easy as it sounds. And so they are now the new competition to Amazon, and I want to say there's one for Japan and I saw there's another one, I still haven't investigated. You know, as soon as it pops I'll be willing to actually check what they're doing, but I have to have somebody that wants to use it.

If you have any questions, leave them below in the comments and Liz will answer them for you. It will be in the group and we will keep an eye on all the comments for the next few days. And then we'll have Liz' information on my on the summit page, on my website. And then all the information will be in the description as well. So if somebody wants to sign up for QuickBooks, I'll put the link in the description for them, right?

Liz Scott (27:21):

Okay. I can even give you the link to test it out. So it's just a free little playground. You can go and see it. You can't break anything.

Liz Scott (27:35):

It resets each time that you log.

Veronica Jeans (27:38):

Oh, that's wonderful. So you can really go and try and break it.

Liz Scott (27:43):

It gives us a couple of things that don't work very well. Because it's a test environment, so it doesn't really have real data. It does dump it, but it's still fine to go try it out, click around, you know, how does it work? I am somebody that needs my hands on it to try and figure it out.

Veronica Jeans (


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