![\"AR](\"https://cdn.shopify.com/s/files/1/0070/7032/files/accounts-receivable-aging.png?format=webp&v=1682706163\")
User experience (UX) and user interface (UI) design date back to the very first inventions—when a prehistoric human first attached a rock to a stick, they made the stone easier to swing (and hopefully got a promotion in the process). As a coherent discipline, though, UI was codified in the 1970s at companies like Xerox and popularized in the 1990s with the wider adoption of the home computer.
\nSince then, UI design has continued to evolve and adapt to new technologies and devices. You can implement user interface design—often shortened to UI design—throughout your ecommerce website by following guidelines. Here’s how to get started.
\nUI design is the process of creating the visual layout and appearance of the software, apps, websites, or any digital interface with which the user interacts. Examples of UI components include the arrangement of buttons on a page, the copy guiding you through the steps to create an account with username and password, and the icons that guide you through a shopping experience. UI design aims to create simple, aesthetically pleasing, and functional interfaces that aid users in accomplishing tasks.
\nGood design does more than look nice—it can improve your bottom line. A widely cited study tracked the performance of popular design-driven companies over a decade and found that they outperformed the 500 largest companies listed on US stock exchanges by 219%. One of the most straightforward ways to emphasize design is through your website’s user interface.
\nUI designers typically work closely with user experience designers, and while UI and UX are closely interrelated, they’re separate disciplines. Where UI design focuses on the visual and interactive elements of the product, like layout, typography, colors, icons, and buttons, UX design is concerned with the overall user experience, including lofty concepts like the general purpose of the product and how the user feels about it. Both are crucial for a successful outcome: A solid UI design supports the underlying UX strategy.
\nThink of the telephone. At first, you had to tell a human operator who you’d like to talk to. Later came the rotary dial, eliminating the need for human operators but adding a time-consuming twirling mechanism. Eventually, the dial pad was introduced, with a button layout that has outlasted the traditional telephone and become standard for mobile phones. Speed dial, contact lists, and voice assistants have further streamlined this process.
\nThis evolution tracks the user interface of the telephone: the buttons and means by which we interact with it. Its user experience, on the other hand, encompasses not just the device’s UI but the actions it performs, our understanding of its capabilities, how satisfied we are after using it, and so on. For example, your satisfaction with your experience of booking a ride on a ridesharing app is influenced not only by the app’s interface, but also by the ease of finding a driver, the estimated time of arrival, and the driver’s behavior during the ride.
\nOver the last few decades, a few UI golden rules have emerged. Here are six you should keep in mind:
\nThe user, in this case, is your customer. To enhance their browsing experience, creating a welcoming environment on your website is essential. Here’s how to make navigation more intuitive and user-friendly:
\nIn other words, your goal is a clean, attractive design with purposeful visual elements that give users the information they need when needed.
\nUI design is also an opportunity to get to know your audience. With marketing research, or even demographic information available through social media accounts, you can delve into their needs and interests. Gain insights by empathizing with users and mapping out their motivations for visiting your site. What buttons and visual information do users want upfront? What might more experienced users want tucked away deeper? By prioritizing your audience, you’re letting their needs dictate the interface.
\nAnother way to let the users control the experience is by allowing them to undo an action without negative consequences. This makes exploring the site feel more accessible and safer, knowing they can always backtrack and return later if they stumble into tedious data entry sequences. So-called breadcrumb trails that show users where they’ve been and where they’re going help them make a mental map of the site and find information more easily. (Consider the one above the headline for this post, where it says Home > Shopify Blog > UI Design Principles.)
\nGood user interfaces are intuitive, with everything exactly where the user expects it. Even the most “disruptive” brands don’t disrupt user expectations in their UI design. Instead, the goal should be a seamless user experience.
\nFamiliar patterns, templates, font choices, and page layouts reduce your visitor’s cognitive load. It also means you don’t have to reinvent the wheel or explain every design decision. The little three-line menus at the top of every app work because we know what they do.
\nColor blindness impacts around 5% of the world’s adult male population and .5% of the female population. The World Health Organization reports that 253 million people have some form of blindness or vision impairment, 466 million have deafness and hearing loss, and another 200 million have intellectual disabilities.
\nDesigning a good website means designing a good website for everyone. The WCAG Web Accessibility Initiative provides UI designers with detailed guidelines. One rule of thumb is not to rely on one element to do all of the communication. Two buttons labeled “Yes” and “No” could also have a checkmark and an X on them, respectively. Making them green and red can add another layer of communication, ensuring that colorblindness or reading skills don’t stop a user from being able to navigate the site.
\nThe previous principle—“Make it intuitive”—helps here, too. Standard symbols and phrases keep everyone on solid ground. Iconographies like the shopping cart icon, the dollar sign, and checkmarks are widely recognized and enable users of all types to navigate easily.
\nUsers like to know when things are working. Consider adding a light animation when a button is clicked to confirm the action, a thank you page to close the loop on a successful transaction or form completion, a progress bar if a function takes time to load, or a series of requirements that gradually turn green when attempting to create a password. All of these can give your visitors that familiar tingle of completion.
\nWe’ve all been there: Rage clicking when a site or piece of software doesn’t work as intended. Good UI mitigates this by providing immediate and informative feedback.
\nPlan for when things don’t go as expected. Well-designed error messages and 404 pages are clear and helpful, redirecting the user to something else. Details like these show customers they’re in a functional, trustworthy shopping environment: They mean, “Don’t worry. We know, and we’re handling it.” (Think of the Twitter fail whale—the cheery beluga being lifted out of the waves by a flock of birds—that used to appear when the platform experienced a service outage. (The fail whale was retired in the summer of 2013 but remains a nostalgic symbol of Twitter’s early days when it struggled to handle high traffic volume.)
\nThink of the design process as an iterative loop with no real endpoint. It’s about repeating steps to improve. After deployment, take a moment to see how your design works before evaluating the data and making adjustments.
\nEmbracing iteration could take many forms; maybe it’s listening to customer feedback, hiring users to test a website, or diving into analytics to see which pages have a high bounce rate or where conversion is lower than expected. Small changes to the design of a checkout page, for example, can fix a leaky sales funnel.
\nAll users and all businesses are different, so a little trial and error are to be expected. With a little tinkering, good UI design can make your site more beautiful, user friendly, and profitable.
\nKey UI design principles include:
\nThe six phases of UI design are analysis (figure out the goals and expectations of the user and business), design (sketch, wireframe, and prototype an actual user flow through the website), development (turn the design into a usable web product), deployment (test for bugs and release), evaluation (measure the effectiveness of the UI design through user testing, feedback, and analytics), and iteration (use the results of the evaluation to fine-tune the design).
\nA good UI should effectively drive key performance indicators (KPIs), and be aesthetically pleasing, intuitive for users, and widely accessible.
\nhttps://www.shopify.com/blog/ui-design-principles
\nThe best way to keep your cash flowing and maintain financial stability is to effectively manage accounts receivable.
\nA company’s accounts receivable (AR) are its outstanding invoices and money owed to its clients. Essentially, it’s a claim for payment held by a business for products or services provided on credit.
\nAhead, you’ll learn the importance of accounts receivable, the AR process, and strategies to manage and reduce AR turnover.
\nTable of Contents
\nAccounts receivable is an asset account that tracks the money due to a business from clients or other debtors. Essentially, the number in this account represents sales made by extending credit to a customer up until the point that the business receives the expected funds.
\nAccounts receivable is considered a current asset account, meaning that it only records funds with a due date within one calendar year.
\nAs such, it represents short-term obligations: If you initiate a five-year contract under which a customer will pay a set amount annually, the receivable balance listed on your balance sheet would only include the amount due within one year. When accounts receivable aren’t paid, some companies send them to a third-party collection agency to recover the debt.
\nAccounts receivable is used under an accrual accounting method, the accounting system in which income and expenses are entered when a transaction occurs, not when funds are received or debited.
\nAccounts receivable is key to managing cash flows: in addition to knowing the amount of money you have, it’s helpful to know the amount of money you will have in the near future.
\nIt’s also helpful to know the amount of money you owe, which is where accounts payable (AP) comes in. Accounts payable refers to money that a business owes to its creditors.
\nIt can include material costs, overhead such as facility and utility fees, and contractor agreements. This number is also recorded on your balance sheet under accounts payable. AP is essentially the inverse of AR.
\nRecording (and collecting on) accounts receivable follows a simple process:
\nLet’s say that you run an ecommerce business that sells handmade clay tiles, and a client submits a purchase order for 300 square-cut tiles, priced at $1.50 each, for a total of $450.
\nThe purchase order will contain payment terms and specify a due date for funds, which is expressed from the date of invoice—“net 60,” for example, means that funds are due within 60 days of the date that the invoice is issued.
\nINVOICING TIP: Tired of creating invoices from scratch? Try Shopify’s free invoice generator. Simply fill in the required information and create an invoice on the spot.
\nYou’d accept the order, make and ship the tiles, and invoice the customer for $450, plus tax and shipping, as applicable. The total amount your customer owes would then be recorded as a credit on your balance sheet under accounts receivable.
\nOnce this sum is paid, the total would be deducted from accounts receivable and recorded as a deposit under revenue.
\nThere are many benefits to recording accounts receivable, from allowing you to extend credit to customers to measuring how efficiently you are collecting the money owed to your business. It can also help you manage cash flow and streamline your accounting systems, freeing you up to focus on running your small business.
\nExtending credit to customers is made possible by a system that tracks the amount of money they owe. By recording credits in accounts receivable, business owners can make sure that customers pay their bills without being forced to collect cash upfront—and extending credit lowers the barrier to purchase, increasing your sales.
\nExtending credit also builds goodwill: Requiring upfront payment can be cumbersome for both you and your customers, and clients are sometimes hesitant to pay for a good or service that they have yet to receive.
\nTracking accounts receivable can help you organize your balance sheet and streamline your invoicing processes.
\nA customer payment appears on your balance sheet three times: once as a credit to receivables, once as a debit from receivables, and once as a credit to revenue. You can easily cross-reference your transactions.
\nBy keeping track of your outstanding debt, an organized balance sheet also helps you collect money owed to you. It also helps you analyze days sales outstanding (DSO), which is the average number of days it takes to collect payment after a sale is made.
\nEcommerce accounting software can even automate parts of this process by automatically crediting accounts receivable when an invoice is issued and debiting accounts receivable (and crediting revenue) when a payment is received.
\nYour accounts receivable balance is a critical indicator of your company’s financial health. Without it, your balance sheet can’t provide an accurate picture of your liquidity. It can also help you manage cash flows, allowing you to meet your obligations while operating with a smaller amount of cash on hand.
\nThe accounts receivable turnover ratio is a financial metric that measures a company’s effectiveness in managing its accounts receivable. A higher ratio indicates more frequent collection of receivables, while a lower ratio suggests less efficient management of credit sales.
\nTo calculate the accounts receivable turnover ratio, use the following formula:
\nAccounts Receivable Turnover Ratio = Net Credit Sales / Average Accounts Receivable
\nWhere:
\nIf your company sells $100,000 on credit per quarter and the average balance of accounts receivable in that year is $10,000, your accounts receivable turnover ratio is 10:1, or 10.
\nIf your average accounts receivable balance over this same period is $120,000, however, your accounts receivable turnover ratio is less than one, coming in at 0.8. If this ratio doesn’t increase, you’re actually losing money over time, even if business is booming—and the more you increase sales on credit, the more money you’ll lose.
\nCombined with your accounts receivable balance, your accounts receivable turnover ratio gives you a strong picture of your business’s overall financial outlook.
\nImplementing effective strategies for managing accounts receivable is essential to ensure timely collections and maintain healthy cash flow.
\nAn accounts receivable aging schedule is a financial statement that categorizes outstanding receivables based on the length of time they have been outstanding.
\nThis report helps businesses identify overdue accounts, assess credit risk, and prioritize collections efforts.
\nAn accounts receivable aging schedule typically includes the following columns:
\nAccount receivables is a critical part of an accrual accounting system, allowing business owners to manage cash flow and keep an accurate, organized balance sheet while extending credit to customers.
\nIn conjunction with accounts payable, it allows your accounting team to keep an eye on long-term financial prospects and provides you with metrics to make sure customers pay their bills on time.
\nIf you’re new to accrual accounting, recording credits for money you don’t actually have in hand can feel a little nerve-wracking. An experienced accounting partner (or modern accounting software) can help you confidently track these transactions and use the information to plan for the future.
\nManage your money where you make it with Shopify Balance
\nShopify Balance is a free financial account that lets you manage your business’ money from Shopify admin. Pay no monthly fees, get payouts up to 4 days earlier, and earn cashback on eligible purchases.
\nDiscover Shopify Balance
\nAccounts receivable is considered an asset because it represents the money that a company expects to collect from its customers for goods or services provided on credit. It’s part of a company’s working capital.
\nhttps://www.shopify.com/blog/accounts-receivable
\nTax season can be a stressful time for both individuals and businesses. One of the critical forms you may encounter is the IRS 1099 form.
\nPayments made to nonemployees don’t show up on a W2. Instead, the IRS requires payers to report payments (over $600) on a tax form known as a 1099.
\nAhead, you’ll learn the various types of 1099 forms, who needs to file them, and how to file them properly.
\nTable of Contents
\nIRS form 1099 is a tax form that businesses, financial institutions, and other entities use to report payments to nonemployees. Nonemployees include independent contractors, freelancers, and other self-employed individuals that are not considered employees of a business.
\n![\"What](\"https://cdn.shopify.com/s/files/1/0070/7032/files/1099-form-example.jpg?v=1682704785\")
Since 1099s don’t include Federal Insurance Contributions Act (FICA) tax withholdings, self-employed individuals pay their version, called a self-employment tax. The 15.3% tax rate is the employer and employee shares of taxes.
\nLike W2s, 1099 forms are considered information returns, which means they contain information about a taxpayer but do not detail tax liabilities.
\nThe IRS uses the 1099 to track nonemployee income, and taxpayers use it to correctly prepare and file income tax returns.
\n1099s can help taxpayers and federal, local, and state tax departments ensure the accuracy of taxable income reported on tax returns. For example, they can help self-employed individuals track total income earned through various freelance or contract positions in a given tax year.
\nAny business that pays a freelancer, independent contractor, sole proprietor, or member of a partnership or LLC more than $600 in a tax year is required to file a 1099 form.
\nThe $600 threshold applies to payments such as rental income, prizes and awards, medical and health care payments, and payments made from a special type of arrangement known as a notional principal contract.
\nFinancial institutions, lenders, and federal and state tax authorities must also provide these tax forms to individuals who have received payments such as royalties or brokerage payments of $10 or more during a given tax year.
\nLearn: Small Business Tax Deductions: 22 Money Saving Tips
\nAcquire the appropriate 1099 form from the Internal Revenue Service (IRS) website. There are several types of 1099 forms depending on the nature of the income. You can look up more information about each form at IRS.gov, or read through the list below.
\nFor each recipient, you will need to fill out three copies of the form: one for the recipient, one for the IRS, and one for your own records.
\nBefore you can complete the 1099 form, ask the recipient to provide you with a completed Form W-9, which includes their name, address, and taxpayer identification number (TIN). The TIN can be a Social Security number (SSN) or an employer identification number (EIN) for businesses.
\nFill in the 1099 form with the following information:
\nReview the form for accuracy and ensure all fields are completed correctly.
\nBy January 31 of the year following the tax year in question, provide Copy B of the 1099 form to the recipient. This allows the recipient to report the income on their tax return.
\nSubmit Copy A of the 1099 form to the IRS by February 28 if tax filing by paper, or by March 31 if filing electronically. If you have 250 or more 1099 forms to file, you are required to file electronically. To do so, register for the IRS’s Filing Information Returns Electronically (FIRE) system.
\nKeep Copy C of the 1099 form for your records for at least three years from the due date of the related tax return.
\nIf you are submitting paper 1099 forms to the IRS, you must also file a Form 1096, which serves as a summary of the 1099 forms you are submitting. Include your contact information, the total number of forms, and the total amount reported. Mail Form 1096 along with Copy A of the 1099 forms to the appropriate IRS service center.
\nE-filing options are available through the IRS website, and many small businesses hire a tax preparation expert to send 1099 tax forms versus using a tax software like Turbotax.
\nThere are multiple types of 1099 forms, each of which is used to record a different type of income or payment. Here’s an overview of some of the most common 1099 forms.
\nForm 1099-A records income from real estate transactions that result in debt cancellation. If you sell your house in a short sale (in other words, for an amount less than the sum of your outstanding mortgage debt) and this results in your mortgage lender forgiving some of your mortgage, your debt reduction is considered taxable income and reported on Form 1099-A.
\nForm 1099-B records capital gains or losses. They are typically issued for brokerage accounts.
\nThis form also records value gained through a barter exchange transaction, a transaction type in which individuals or entities agree to exchange goods or services without accepting monetary payment.
\nForm 1099-C reports income in the form of credit card or other cancellation of debt or forgiveness. If, for example, your credit card company forgives $10,000 of credit card debt, that $10,000 is considered taxable income and must be reported on an income tax return.
\nIf your debt forgiveness involves a real estate transaction (such as foreclosure on a home), you might receive both forms 1099-A and 1099-C. The lender will issue Form 1099-A when you abandon the property, and your financial institution will issue Form 1099-C when it forgives the debt.
\n1099-DIVs report distributions in the form of dividend earnings, which are funds paid to a company’s shareholders out of its profits. Dividend earnings are a type of investment income.
\nForm 1099-G reports distributions received from local, state, or federal governments. This can include unemployment payments or tax refunds, credits, or refund offsets.
\nForm 1099-INT reports interest income from a bank account, brokerage account, or other financial institution.
\nForm 1099-K is sent to freelancers, independent contractors, or any unincorporated business entity paid more than $600 from another business annually via credit card or an electronic payment app like Venmo or Zelle.
\nForm 1099-LTC records benefits paid out by long-term care insurance contracts or accelerated death benefits from a life insurance contract.
\nForm 1099-MISC is used to report miscellaneous income such as rent, prizes and awards, and royalty income. Any individual who received payments of more than $600 in a tax year can expect a 1099-MISC.
\nForm 1099-NEC is one of the most common types of 1099s. 1099-NECs are for non-employee income: any business that pays an independent contractor, sole proprietor, or member of a partnership or LLC more than $600 dollars in a tax year by either direct deposit or cash payment is required to send the payee a 1099-NEC.
\nForm 1099-OID records discounts, or when the security drops below face value, on bonds or notes. These discounts are considered taxable income. You’ll receive a 1099-OID from the original issuer of your discounted bond.
\nSome cooperatives pay members patronage dividends. Any dividends in excess of $10 annually are recorded on Form 1099-PATR.
\nForm 1099-Q records money that you receive from a 529 plan, which is an education savings account. These funds are only considered taxable income if they are used for purposes other than qualified education expenses.
\nForm 1099-R reports distributions from a retirement plan, such as a retirement pension, annuity, IRA, profit-sharing program, or other retirement account.
\nForm 1099-S reports proceeds from the sale of a home or other real estate property. Whether are not these proceeds are considered taxable income depends on a number of variables, so consult the IRS website or a tax professional for details on your specific situation.
\nForm 1099-SA records distributions on a health savings account (HSA) or different types of medical savings accounts (MSAs), including Medicare Advantage MSAs. These distributions are not considered taxable income if they are used for qualified health expenses.
\nForm SSA-1099 is also known as a Social Security Benefit Statement. This shows the total benefits you received from the Social Security Administration in the previous year.
\nTake the stress out of sales tax with Shopify Tax
\nWith Shopify Tax, you can oversee your current sales tax obligations from Shopify admin, collect the right amount at checkout with product and location-specific accuracy, and let Shopify automatically apply rate and regulatory changes whenever they happen.
\nExplore Shopify Tax
\nThe IRS uses the 1099 to track nonemployee compensation; it’s used by taxpayers to properly file federal income tax returns.
\nBusinesses or other entities must fill out 1099s and provide them to freelancers, independent contractors, sole proprietors, or members of a partnership or LLC who have earned more than $600 in nonemployee income during a given tax year.
\nFinancial institutions, lenders, and federal and state tax authorities must also provide these tax forms to individuals who have received payments during a given tax year, including royalties or brokerage payments of at least $10.
\nA Form W-2 is issued by employers to report an employee’s annual wages and the taxes withheld from their paychecks. A 1099 form is issued by businesses or individuals to report various types of non-wage income, such as payments to independent contractors, freelancers, or vendors.
\nA Form W-4 is used by employees to indicate their tax withholding allowances, helping employers determine the correct amount of federal income tax to withhold from their paychecks. A 1099 form, as mentioned earlier, is used to report non-wage income for independent contractors and other recipients of miscellaneous income.
\nhttps://www.shopify.com/blog/1099-form
\nLearn more about how to create an outstanding customer experience and reap its benefits!
\nHaving a great customer experience can mean something different for everyone. For some, it’s being able to pay in their preferred method. For others, it’s about a website’s design and user experience.
\nBut make no mistake—customer experience can make or break a customer’s relationship with your business.
\nThat’s why customer experience improvement has seen a 19 percentage point increase in priority from 2019 to 2022, according to research from McKinsey & Company.
\nBut given how vague “customer experience” can be, it’s difficult for some businesses to pin down. Ahead, you’ll learn everything about customer experience and how to improve it.
\nTable of Contents
\nCustomer experience is the sum of all interactions a customer has with your brand, from the moment they discover your company to after-sales support. A positive customer experience fosters brand loyalty, increases customer lifetime value, and drives word-of-mouth marketing.
\nFilip Pejic, founder of Pearly, a DIY bubble tea business, says customer experience is about “making sure the customer feels heard at all steps in the buying process. Resolving any issues or pain points as easily as possible, delivering a unique, seamless, and unexpectedly awesome experience.”
\nA good CX strategy has many benefits for your business:
\nEvery touchpoint your customers have with your brand is a chance to create a positive customer experience, or a negative one.
\nAlthough the terms “customer experience” and “customer service” often are used interchangeably, they refer to distinct initiatives.
\nRead: How To Save Sales and Solve Customer Problems With Live Chat Customer Service
\nA good customer experience is different for each business. It depends on what your customers value and what you can realistically provide.
\nHowever, there are a few universal truths that define a good customer experience:
\nLearn more: Customer Service 101: A Guide to Providing Stand-Out Support Experiences
\nA poor customer experience can negatively impact your reputation and customer loyalty. The first step toward improving customer experience is to understand the common causes.
\nHere are some common factors:
\nThink about the last time you were annoyed as a potential customer. What happened? It’s probably one of the reasons mentioned above.
\nThinking your business has a great customer experience differs from knowing it has.
\nSo, how do you figure out if what you’re doing is working? You measure it. This section will cover some of the easiest and most reliable ways to measure your customer’s experiences.
\nCustomer effort score refers to how much effort your customers have to put in to interact with your business. Or to put it another way, how easy or difficult it was for them to resolve an issue with your customer support team.
\nYou’ll want to track this metric to ensure your CS team is doing its best to make things right with your customers. Happy customers = a better experience.
\nYou’ll find most CES surveys are based on a single main question:
\nHow easy was it to deal with [insert your brand] today, from 1 (very difficult) to 5 (very easy)?
\nHere’s an example from Monzo Bank:
\n![\"customer](\"https://cdn.shopify.com/s/files/1/0070/7032/files/customer-experience-example.png?format=webp&v=1682707700\")
As you can see in the example, asking for customer feedback or additional comments is common, which can help your business figure out any specific pain points they experience.
\nNet Promoter Score is a popular metric businesses use to measure customer opinions. If you’ve ever interacted with a customer service representative before, you’ve probably come across the follow-up survey designed to generate an NPS.
\nIt’s a favorite because, like CES, it has only a single question:
\nHow likely are you to recommend us to a friend or colleague?
\nYou might see variations in the relationships (e.g., friend or family member), but the measurement of the question is still the same—a Likert scale from 1–5 or 1–10.
\nHere’s an example of an NPS survey from Squarespace:
\n![\"squarespace](\"https://cdn.shopify.com/s/files/1/0070/7032/files/squarespace_edc4c012-0781-48c2-9467-d0713dea7f37.png?format=webp&v=1682707739\")
NPS surveys are a great option to get quick feedback, and you can send them via email, SMS, or in-app prompts, if applicable.
\nAnother common customer experience metric is the customer satisfaction score (CSAT). CSAT is a score that measures your customers’ perception or overall happiness/satisfaction with your business.
\nIt’s another survey you can send to your customers after their purchases, but it uses a few more open-ended questions than the other surveys. CSAT surveys are valuable because you can get more information about your customers’ experiences than a single scale.
\nHere’s an example from Just Eat:
\n![\"customer](\"https://cdn.shopify.com/s/files/1/0070/7032/files/customer-satisfaction-score.png?format=webp&v=1682707844\")
You can use multiple-choice questions, free-text answer boxes, and sliding scales to help your loyal customers express their opinions better and help you understand their overall customer experience.
\nThe time-to-resolution metric is also important to track, but it’s not something you send to your customers. It’s a behind-the-scenes measurement of how long it takes your customer support team to resolve an issue a customer is having.
\nThe longer your TTR, the more likely it is to be a bad experience for the customer. You can also use a metric alongside first-time resolution (FTR) to see the percentage of support tickets resolved in the first contact versus how many take more than a single interaction.
\nTo measure either of these metrics, you’ll need a software provider that helps you track your support ticket completion rates, such as HelpScout.
\nHere’s a common experience you could add to your customer journey map:
\nScenario: Online product return
\nJohn recently bought shoes from an ecommerce website. After receiving the shoes, he realized they were the wrong size. To return the shoes and request a different size, John had to navigate through the company’s return process.
\nCustomer effort score survey
\nAfter completing the return process, John receives an email containing a CES survey from the company. It asks him to rate the ease of the return process on a scale of 1 (very easy) to 7 (very difficult).
\nJohn found the return process relatively straightforward. The website had a dedicated returns section with clear instructions and provided a prepaid shipping label.
\nHowever, John had to print the label himself, which he found inconvenient. As a result, John rates the ease of the return process as a 2 out of 7.
\nAnalysis and Improvement
\nCES data shows that the company can streamline the return process by offering a more convenient way to print shipping labels. Customers could receive pre-printed labels in the mail or use digital shipping labels that can be scanned at the carrier’s location.
\nWith CES, the company can measure and improve the customer experience, resulting in increased customer satisfaction and a higher likelihood of future purchases.
\n![\"What](\"https://cdn.shopify.com/s/files/1/0070/7032/files/shopify-inbox_69c6f01a-7c39-4830-8c8e-f4a3c433ede1.png?format=webp&v=1682707914\")
Would you like to chat to your customers from Instagram, Facebook, and more with one handy chatbot, in real time? How about knowing what’s in your customer’s cart when they reach out to you? Shopify Inbox is a free messaging app that lets you turn chats into checkouts.
\n![\"What](\"https://cdn.shopify.com/s/files/1/0070/7032/files/wonderment.png?format=webp&v=1682708029\")
It can be frustrating for customers to have purchased a product from you and not know where it is. Wonderment Post-Purchase is a tool that helps you sort orders by fulfillment status, carrier, or region.
\nIt helps you let customers know if their order is delayed before they raise a support ticket about it. You can optimize all of your post-purchase experiences with this app.
\n![\"hubspot\"](\"https://cdn.shopify.com/s/files/1/0070/7032/files/hubspot_52d10625-9d69-41a0-be16-ad78e819419a.png?format=webp&v=1682708079\")
Already use HubSpot for your customer relationship management (CRM) or email marketing needs? With the official HubSpot for Shopify integration, you better understand customer interactions, leverage automation, segment groups, and improve your customer experience management (CXM).
\nYou can even sync the customer data you gather in your Shopify store to HubSpot and turn it into valuable marketing signals to use in your campaigns.
\nA great customer experience strategy is at the heart of any successful ecommerce store. It helps improve customer engagement and reduces customer churn rate.
\nUsing the tips and tools in this guide, you’ll be well on your way to building a customer experience you can be proud of. One that both customers will appreciate every time they shop with you and improves your bottom line.
\nA good customer-centric experience is one that is seamless, personalized, and easy to navigate. Customers feel valued and satisfied with the quality of products or services, prompt and empathetic customer support, and a consistent experience across all customer touchpoints.
\nhttps://www.shopify.com/blog/13251973-creative-ways-to-improve-ecommerce-customer-experience-that-also-boost-loyalty-and-sales
\nUnderstanding and analyzing data and key metrics for your online store can be challenging, especially when there are no industry standards or comparative data available. If your store’s conversion rate is 4%, is that good? How does it compare to other stores in the same industry? Should you invest in improving your conversion rate?
\nBenchmarks are industry-specific metrics that establish a performance standard for businesses. They provide insights into your online store’s performance, allowing you to make informed decisions about where to focus your efforts and resources.
\nWith millions of merchants on our platform, Shopify has the unique ability to match merchants not against industry standards but to surface benchmark data against similar merchants. Comparing performance against stores similar to yours, gives merchants a highly competitive and achievable advantage.
\nBenchmarks in Shopify are based on cohorts of stores that are similar to yours. These cohorts are defined by looking at the order volume, primary market, and product categories sold over the past 30 days. If there aren’t enough similar stores like yours on Shopify, Benchmarks data may not be available for your store.
\n\n
Shopify gives you Benchmarks data at a median, 25th percentile and 75th percentile level so that you can make better decisions based on your relative performance. For instance, finding yourself in a narrow range for conversion between the median and 75th percentile may suggest that smaller changes in conversion rate might not have a significant impact on your top-line. This means you can focus instead on your average basket size by offering bundling options.
\nPercentiles can also be helpful in indicating how close or far your shop is from peak performance. When there is only a small difference between the median and 75th percentile, even a small percentage improvement in conversion rate can bring your store up to par with other stores at the 75th percentile.
\nIn this first iteration, Benchmarks data is available for the following metrics in Shopify: online store conversion; average order value; retention rate; and time to fulfill, ship, and deliver. You can access these metrics using the relevant reports in Shopify.
\nOnline store conversion is the percentage of website visitors who make a purchase. View the Online store conversion over time report in Shopify to find out how your store’s conversion rate is doing compared to other similar stores in the industry over a period of time.
\n![\"Online](\"https://cdn.shopify.com/s/files/1/0070/7032/files/Reports___Customer_cohort_analytics_-_BG.jpg?v=1682700098\")
Compare the average value of an order placed on your store against similar stores using the Average order value over time report.
\n![\"AOV](\"https://cdn.shopify.com/s/files/1/0070/7032/files/Reports___Benchmarks_A.jpg?v=1682980215\")
Retention rate is the percentage of customers who return to your website to make another purchase. Dig into your Customer Cohort Analysis report to view the retention rate for your store and compare against similar stores.
\n![\"Retention](\"https://cdn.shopify.com/s/files/1/0070/7032/files/Reports___Benchmarks_B.jpg?v=1682980239\")
Time to fulfill is the average time it takes for you to start processing an order after it’s placed. Time to ship is the average time it takes for an order to be shipped after it’s been processed. Time to deliver is the average time it takes for an order to be delivered after it’s been shipped. The Fulfillment, shipping, and delivery times report in Shopify gives you a clear view of these metrics along with Benchmarks data to analyze your performance in fulfillment, shipping and delivery.
\n![\"Fulfillment,](\"https://cdn.shopify.com/s/files/1/0070/7032/files/Reports___Benchmarks_C.jpg?v=1682980263\")
Benchmarks help you stay on top of the game by giving you unique insights that uplift your performance and help you make better decisions. With Benchmarks, you can realistically view how your KPIs are performing against others in the industry, identify areas for improvement, and see where your efforts are paying off.
\nhttps://www.shopify.com/blog/benchmarks
\n"}]},"page_header":{"background":null,"backgroundOpacity":100,"color":null,"fieldGroupName":"page_header","title":"Benchmarks for Comparison","opacity":100,"position":"on","size":{"desktop":64,"tablet":null,"mobile":null},"spaces":{"top":null,"bottom":null,"leftright":null,"units":"em"}},"link":"/blog/compare-data-to-stores-like-yours-with-benchmarks"},{"id":"cG9zdDo1NDUx","title":"Double-Entry Bookkeeping: Guide for Small Business Owners","date":"24.05.2023","schemaDate":"2023-05-24","modifiedGmt":"2023-07-28T07:02:59","slug":"double-entry-bookkeeping-guide-for-small-business-owners","acfSchemaPost":{"blogPostingImage":null},"categories":{"nodes":[{"id":"dGVybTox","name":"General Articles"}]},"levels":{"nodes":[]},"acfPost":{"fieldGroupName":"acfPost","excerpt":"It’s a common bookkeeping problem for small-business owners: You review your monthly bank statements and check them against a handwritten log of sales and expenses. The log and bank statements don’t always match, however. Sometimes the bank says you have more money than your records show, sometimes less. ","squaredImage":{"altText":"Double-Entry Bookkeeping: Guide for Small Business Owners","localFile":{"childImageSharp":{"gatsbyImageData":{"layout":"fullWidth","backgroundColor":"#c8a8b8","images":{"fallback":{"src":"/static/d6c01754bf4a8f56618847d7a1f16e7c/b956e/double_20entry_20bookkeeping.webp","srcSet":"/static/d6c01754bf4a8f56618847d7a1f16e7c/d1fa5/double_20entry_20bookkeeping.webp 750w,\n/static/d6c01754bf4a8f56618847d7a1f16e7c/b956e/double_20entry_20bookkeeping.webp 1024w","sizes":"100vw"},"sources":[]},"width":1,"height":0.4228515625}}}},"metaData":{"title":null,"description":"Discover the power of double-entry bookkeeping for small businesses. Learn how it works, its benefits, and limitations. Understand the differences between double-entry and single-entry bookkeeping. Get step-by-step instructions to set up a double-entry system and conduct a trial balance. Explore the importance of double-entry accounting for financial statements and external reviews. Choose the right accounting software to streamline your bookkeeping process and gain accurate insights into your business's finances"},"banner":{"title":"Double-Entry Bookkeeping: Guide for Small Business Owners","showTitle":true,"image":{"altText":"Double-Entry Bookkeeping: Guide for Small Business Owners","localFile":{"childImageSharp":{"gatsbyImageData":{"layout":"fullWidth","backgroundColor":"#c8a8b8","images":{"fallback":{"src":"/static/d6c01754bf4a8f56618847d7a1f16e7c/b956e/double_20entry_20bookkeeping.webp","srcSet":"/static/d6c01754bf4a8f56618847d7a1f16e7c/d1fa5/double_20entry_20bookkeeping.webp 750w,\n/static/d6c01754bf4a8f56618847d7a1f16e7c/b956e/double_20entry_20bookkeeping.webp 1024w","sizes":"100vw"},"sources":[]},"width":1,"height":0.4228515625}}}}},"timeToRead":null,"sections":[{"fieldGroupName":"post_Acfpost_Sections_ArticleRichTextContent","content":"It’s a common bookkeeping problem for small-business owners: You review your monthly bank statements and check them against a handwritten log of sales and expenses. The log and bank statements don’t always match, however. Sometimes the bank says you have more money than your records show, sometimes less.
\nThere is a better way to keep track of your business’s finances. It starts with double-entry bookkeeping.
\nTable of Contents
\nDouble-entry bookkeeping, also called double-entry accounting, is a system of recording each business transaction twice. These are known as bookkeeping entries, and they appear in equal but opposite amounts. One entry shows the source of money of each transaction, and the other entry shows the money’s destination. The double-entry system displays two columns for these entries, called debits and credits.
\nThe key feature of double-entry is that the two columns must balance. This allows you to track money coming into your business and going out of it. Through periodic reviews called a trial balance, you ensure accounts are accurate.
\nA double-entry accounting system is more reliable than a single-entry accounting system, in which purchases and payments are recorded simply as additions or subtractions to a single business account. Double-entry allows you to create other accounts to track money not yet received (accounts receivable) or paid (accounts payable), and goods held for sale (inventory).
\nPublicly traded companies and many privately owned companies use double-entry bookkeeping. It’s essential for preparing financial statements, such as the balance sheet, income statement, and cash-flow statement, as well as for accrual accounting—recording revenue and costs as they occur but that are not yet received or paid. Lenders and investors require financial statements based on double-entry to verify a business’s financial condition before they consider a loan or an equity investment.
\nDouble-entry bookkeeping and balancing a business’s books—ensuring that debits equal credits—is linked to a fundamental concept of finance called the accounting equation. It looks like this:
\nAssets = Liabilities + Equity
\nThis equation sums up a business’s balance sheet, one of three essential financial statements along with the income statement and cash-flow statement. It’s called a balance sheet because the business’s assets must equal, or balance, the debt and liabilities used to finance them.
\nIdeally, assets are greater than debt and liabilities, and this difference makes up the owners’ or shareholders’ equity. Equity represents the dollar value of an ownership stake, whether the business is a sole proprietorship or a huge corporation with thousands of shareholders.
\nIn double-entry bookkeeping, the left-side entries are called debits and the right-side entries are credits. The document (or software) where these entries are recorded is called a ledger.
\nDouble-entry can help your small business in several ways, including:
\nAt the same time, double-entry has some drawbacks, including:
\nA quick rundown of the differences include:
\nFinance apps in the App Store
\nEvery business is unique, but they all need to make money and pay taxes. We have the apps to help stay on top of your finances.
\nUsing an accounting software program is one of the easiest ways to start double-entry bookkeeping. Your small business has a wealth of options to choose from. After the initial setup of a double-entry system, most software providers charge a monthly subscription fee.
\nIf your business accounts need to be straightened out first, you may also need to hire a bookkeeper or accountant before investing in a software program.
\nHire the business expertise you need
\nConnect with Shopify experts for free today, so you can grow your business tomorrow.
\nStarting a double-entry system isn’t necessarily easy, but the following four steps can simplify the process:
\nDouble-entry requires the following five accounts for entering debits and credits. The first three relate to the business’s balance sheet, and the latter two to the income statement:
\nThis is the place to record all transactions, in chronological order, with documentation, such as receipts, bills, and invoices. Journal transactions are then transferred and entered twice in the ledger as offsetting debits and credits. Software programs for business accounting typically are set up with formats for a journal and ledger.
\nEven with a software setup, understanding the double-entry system can be challenging if you have little or no accounting experience. First, you must match transactions to the appropriate accounts for debit and credit entries. Second, the terms “debit” and “credit” are not always as simple as “add” and “subtract” in single-entry bookkeeping, and they may even seem counterintuitive. In some cases, a debit increases an account while a credit decreases it.
\nThe important point is that debits, on the left side of the ledger, must be balanced by equal credits on the right side, to properly track the source of money for each transaction, and the destination for the money. Accounting software does much of this for you.
\nTo keep them straight, below is a chart of the five key accounts and how they are debited or credited in double-entry bookkeeping:
\n| ACCOUNT | \nHOW IT INCREASES | \nHOW IT DECREASES | \n
| Assets | \nDebit | \nCredit | \n
| Liabilities | \nCredit | \nDebit | \n
| Equity | \nCredit | \nDebit | \n
| Income | \nCredit | \nDebit | \n
| Expenses | \nDebit | \nCredit | \n
Here are a few examples of double-entry bookkeeping:
\nLet’s say your business, an online seller of cookware and kitchen utensils, secures a $20,000 bank loan. A double-entry record of the loan transaction would look like this:
\n| ACCOUNT | \nDEBIT | \nCREDIT | \n
| Cash (asset) | \n20,000 | \n\n |
| Loan payable (liability) | \n\n | 20,000 | \n
Now, using part of the loan proceeds, let’s say you buy $10,000 worth of cookware at wholesale for your inventory. Here’s how this would look in double-entry:
\n| ACCOUNT | \nDEBIT | \nCREDIT | \n
| Inventory (asset) | \n10,000 | \n\n |
| Cash (asset) | \n\n | 10,000 | \n
Finally, you buy advertising for $2,500. You would record the costs as a double-entry this way:
\n| ACCOUNT | \nDEBIT | \nCREDIT | \n
| Advertising (expense) | \n2,500 | \n\n |
| Cash (asset) | \n\n | 2,500 | \n
The trial balance is a review of the ledger to ensure that debits and credits match. This is the time to find and correct any errors so that the ledger can be used to prepare the business’s financial statements. You typically perform this review monthly.
\nSome historians cite evidence of people using the double-entry method almost 2,000 years ago in the Middle East, but it became more widely used during the Italian Renaissance. Credit is often given to Luca Pacioli, a 15th-century Venetian friar and mathematician who wrote a treatise on the subject. He is sometimes called the father of modern accounting.
\nYou could, though it would be a waste of time. Double-entry bookkeeping incorporates all aspects of single-entry bookkeeping, so there is no need to do them simultaneously.
\nSome basic knowledge of accounting is helpful, because the double-entry system of debits, credits, and multiple accounts might seem daunting to a newcomer. Many small-business software programs are available and easy to set up.
\nhttps://www.shopify.com/blog/double-entry-bookkeeping
\n