Applying AI in the E-Commerce
Amazon’s complicated accounting framework overlay on vendors’ outdated accounting and reconciliation processes, inevitably leads to significant profit leakage. This process can cost vendors as much as a 5% loss for every $100,000 generated through Amazon. Marketplace vendors must find a way to match up with Amazon by utilizing equally advanced technology.
Amazon has long recognized and reaped the benefits of artificial intelligence (AI), machine learning (ML), and related technologies. Countless organizations across all types of verticals use AI in everyday business endeavors. It helps improve the speed of business, processes massive amounts of data, reduces human errors, identifies expansion possibilities, and drives productivity gains.
More specifically, regarding accounting, AI is helping businesses find a balance between brainpower and modern technology by automating numerous tasks and increasing efficiency. It draws conclusions from large quantities of data and adjusts activities based on its findings. As more data pours in, it solves increasingly complex formulas. AI can also overtake specific tasks like facilitating tax preparation, performing budget forecasting, reducing the risk of fraud, and streamlining data entry and analysis.
AI the future of E-Commerce Accounting
Amazon vendors have struggled to match the company’s complexity for true clarity in accounting and reconciliation. Apart from various tax compliances and complex fee structures, vendors face a number of challenges in their accounting practices.
Challenges in Amazon Accounting
- High Volume of transactions: Amazon vendors deal with a high volume of transactions which leads to a rise in the number of shortages, overbillings and chargebacks. It is difficult to manage and reconcile their accounts in a timely and accurate manner.
- Labyrinth of data points: With the growth of e-commerce, the volume of data generated by e-commerce accounting is increasing rapidly, creating a need for sophisticated data analysis tools and techniques to manage, interpret, and utilize this information effectively.
- Inventory Management: Inventory management is critical for Amazon vendors, as they need to ensure that they have enough stock to meet Purchase Order demands, while minimizing storage fees and avoiding stock-outs.
- Manual Processes: Many Amazon vendors still rely on manual processes to manage their accounting, such as spreadsheets, which can be time-consuming and error-prone, especially as their businesses grow.
- Quick Resolutions: Amazon has a large and complex platform, and as a result, there can be delays or difficulties in getting in touch with their support team. It is not easy to get through Amazon support. In some cases, Amazon vendors may find it challenging to resolve disputes with Amazon, particularly if there are complex issues or discrepancies involved.
By leveraging AI and machine learning algorithms, Amazon vendors can reduce or eliminate these challenges. These technologies can automate certain functions and analyze complex data, providing valuable insights that can improve decision-making for e-commerce businesses.
Fully-Automated E-Commerce Solution
By incorporating DimeTyd’s AI and RPA capabilities into their accounting processes, vendors have been able to conveniently eliminate errors, increase cost efficiency, and create more seamless FinOps. With these services, vendors can optimize their accounting processes, reduce manual effort, and gain greater insights into their financial operations, enabling them to make data-driven decisions and achieve better financial outcomes.
DimeAide
DimeAide is an integration of the full spectrum of dispute management tools to ensure seamless timely disputing and recovery of missed revenue. This solution protects vendors from missing out on the opportunity to dispute transaction entries from both payables and receivables.
DimeAide focuses on
- Identifying and disputing all instances of overbilling related to expenses
- Recovering overbilled amounts on behalf of the vendor
- Submitting and managing shortage claims disputes
- Tracking the progress of shortage claims recoveries
DimeCore
DimeCore is another automated solution that significantly reduces the number of resources required. It is powered to provide precise, accurate, and timely reports, empowering vendors to run the most efficient and profitable business without performing any manual tasks.
DimeCore constitutes core transactional-level jobs that need to be performed every day:
- Managing invoices that contribute to shortages
- Gleaning data from multiple pages of line items
- Allocating and indexing data to streamline the Cash Application process
- End-to-end management of operational chargebacks, including timely disputes, root cause analysis, areas of improvement, monitoring, and reporting
- Managing itemized shortage disputes on a daily basis
DimePlan
DimePlan infuses AI predictive insights and advanced analytics through machine learning to help vendors make smarter business decisions and drive future-ready performance. It provides insights into drivers of revenue and profit and deep evaluation at the ASIN/SKU level. This helps to identify the most profitable areas and shift resources accordingly.
It is crucial to align financial plans with operational plans to:
- Identify areas where revenue is being lost
- Determine which ASINs/SKUs generate the most revenue, and which do not
- Forecast demand from Amazon over a 26-week period
- Ascertain the amount of stock needed to meet Amazon’s demand and ensure adequate inventory levels
To manage shortages, vendors need to ensure they have a clear understanding of their inventory levels and reorder points, and implement processes to monitor and track inventory accurately. To address overbilling and operational chargebacks, vendors need to regularly review their account statements and invoices to identify discrepancies and dispute them promptly with Amazon.
Identify, Recoup and Reinvest
The ability to identify and recoup funds quickly and track down errors in the invoicing process are true game changers for vendors to ensure precision in their accounting and reconciliation. It’s time for vendors to evolve and embrace these technologies to drive profitability and direct important internal resources elsewhere.
Commence by calculating how much can recoup with the help of DimeTyd calculator in just 3 simple steps!
To summarize, by utilizing AI, vendors can take advantage of:
- Generating new insights from the analysis of data
- Freeing up time to focus on more valuable tasks such as decision-making, problem-solving, advising, strategy development, relationship-building, and leadership
- Improving analysis of unstructured data through deep learning
- Machine learning-based predictive models for ASIN forecasting and profitability
- Discovering hidden profitability and reinvesting in the bottom line of their business
AI is highly effective in analyzing vast amounts of data to identify overarching patterns, making it an ideal tool to support the strategic aspects of an accountant’s work, such as reporting on financial performance and predicting future changes.
DimeTyd’s automated accounting solution can recover up to 93% of profit leakage from years of transactions.
Commence your journey with a complimentary audit! Schedule a Demo now💡