Inventory accounting is where DTC brands quietly die
shopify_survivor · 4/9/2025
Cash basis makes a growing inventory business look profitable right up until the credit line is gone. If you sell physical product and your books do not carry landed cost, you do not know your margin. Anyone moved from cash to accrual mid-year — how painful?
5 replies
Cash basis DTC brands looking at a great month that was actually a big inventory buy. Classic.
PenskeFile · 4/10/2025
Exactly this. Our "best quarter ever" was a container arriving.
shopify_survivor · 4/10/2025
Landed cost is where most of them break. Freight and duty belong in the unit cost, not in an expense bucket you look at once a year.
bookkeeping_becky · 4/10/2025
we just count everything in december and hope
Ninjasaurus_Rex · 4/15/2025
Please do cycle counts. Please.
bookkeeping_becky · 4/15/2025
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