eBay® PowerSeller Business Practices FOR DUMMIES®

Chapter 41. Understanding Your Financial Reports

In This Practice

• Why keep the books?

• Finding a professional

• Regularly posting your sales and inventory info

• Letting your reports talk to you

Truth be told, posting bookkeeping entries is excruciatingly boring. I dislike it more than any other business task, but it's crucial to keeping up with the current status of just "how you're doing." Using a bookkeeping program makes this chore a lot easier — because all you have to do is click a button to generate your sales or tax information. It's a lot less time-consuming than manually going over pages of sales information on a pad of paper. That's why I'm a fan of bookkeeping software — particularly QuickBooks (more about QuickBooks in Practice 36).

If you really want to, I suppose that you could use plain ol' paper and pencil to keep your books. If that makes you happy, then go for it — for now — just understand that it definitely won't work for you in the future, especially at the PowerSeller level of doing business. Entering all your information into a software program early on — while your books may still be fairly simple to handle — can save you a lot of time and frustration down the road, when your eBay business has grown beyond your wildest dreams and no amount of paper can keep it all straight and organized.

To manage your business effectively, you must keep track of all your expenses — down to the last roll of tape. You need to keep track of your inventory, how much you paid for the items, ...