Practice Comment by FD : Are you wise to your online trading clients ?
Amazon and eBay are the first ports of call for aspiring entrepreneurs. Regrettably far too many of them will either burn their fingers or be wasting their time, mainly due to their failure to grasp the realities , both financial and commercial of trading this way. The ones who usually "succeed" are those earning beer money but will never get beyond that point. From my discussions with many of them it seems that they fail to understand margins, selling fees and distribution costs : not to mention the impact of VAT where applicable.
More worrying is that too many accountants don't understand the vagaries of selling on Amazon and eBay which puts them at a disadvantage when advising small online "bedroom" traders. When was the last time you told a client they were wasting their time (and money) in purusit of a the pot of gold at the end of the rainbow ? To do that you need a thorough understanding of the marketplace. Have you been to any webinars or seminars about online trading ? Did you ever open a book on the subject ?
To complicate matters , the landscape shifts quickly in the world of online trading , so it is not good enough to read the book from 2 years ago or even 6 months ago sometimes. So far I have only referred to Amazon and eBay but have you ever sat with a client when reviewing their accounts and helped them analyse whether or not their Adwords spend on Google is actually delivering the goods ?
The online trading scene is vast and complex. But you need to know about it if you want to stay ahead of the game and get a reputation as a business adviser who knows what's going on out there. It's not necessarily your job to provide solutions - you can send the client to specialists , but without your input many will either fumble in the darkness or be led a merry dance by "experts" who wouldn't stand up to the scrutiny of an accountant.
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