Dropshipping is a popular business model for Shopify stores: you sell, your supplier ships. But how do you handle the bookkeeping correctly? And how do you keep your Moneybird administration automatically up to date? In this article we explain how Shopify dropshipping accounting in Moneybird works and what Schakel can do for you.
What makes dropshipping accounting different?
With a regular webshop you buy stock, store it, and ship products yourself. With dropshipping, the flow is different:
- You receive payment from the customer (sales invoice)
- You pay the supplier for the order (purchase invoice)
- The supplier ships the product directly to the customer
In your bookkeeping you therefore have two separate transactions per order: a sales transaction toward the customer and a purchase transaction toward the supplier. The difference is your gross margin.
Automatic sales invoice creation
Every paid Shopify order needs to appear as a sales invoice in Moneybird. With 30 orders a day, keeping up manually is no longer realistic. Schakel connects Shopify directly to Moneybird and automatically creates a sales invoice as soon as an order is paid. This keeps your Shopify accounting always up to date without any manual work.
Schakel correctly processes:
- Customer details (name, address, VAT number for business customers)
- Product lines with correct VAT rates
- Discount codes and gift cards
- Shipping costs as a separate invoice line
- Payment registration via the correct bank account
Purchase invoices from suppliers
In addition to the sales invoices you have purchase invoices from your dropshipping supplier. These are processed manually (or via an import function) in Moneybird as purchase receipts. A few tips:
- Link a ledger account: Use a separate ledger account for dropshipping purchases so your margin is immediately visible. See also setting up ledger accounts in Moneybird.
- VAT for foreign suppliers: Sourcing from China or another EU country? Different VAT rules apply. For EU suppliers, the reverse-charge mechanism applies to B2B deliveries.
- Currency: Paying your suppliers in USD? Moneybird supports foreign currencies. Make sure you book exchange rate differences correctly.
VAT for dropshipping: watch out for international rules
Dropshipping has specific VAT complications, especially when selling to consumers across Europe. Since July 1, 2021, the OSS (One Stop Shop) system applies: if you sell more than €10,000 per year to EU consumers outside your home country, you must remit VAT in each consumer’s country.
Schakel automatically recognises EU orders and can assign the correct VAT code, so your Moneybird OSS reporting is accurate. Read more in our article about Shopify OSS and EU sales.
Margin calculation in Moneybird
One of the advantages of a clean dropshipping administration in Moneybird is that you can see your margin directly. Book sales invoices to revenue and purchase invoices to a cost account called “dropshipping purchases”. Your profit and loss statement will then show your gross margin percentage per period straight away.
Returns in dropshipping
Returns are extra complex with dropshipping: the customer ships back to the supplier, but the credit note runs through you. Schakel automatically creates a credit note when a Shopify order is returned or refunded. This means your administration is always correct, even when returns are high.
Getting started with Schakel for your dropshipping store
Schakel is set up in 10 minutes for your Shopify dropshipping store. Connect your Moneybird API token once, configure your invoice settings, and everything runs automatically from there. Try it free for 30 days, no credit card required.
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