When looking at an item myself, on the register or the dashboard, it makes sense to have the item as an 'item' with multiple variations. However, when the customer looks at it they're likely to see different 'items' instead of different 'variations'. It would be greatly beneficial to be able to select a checkbox on the item page in square online that makes the different variations show to the customer as different items.
One instance is Cards, we have cards from multiple sources and like to group them based on source for ease of ordering (due to order minimums etc.). However, this practice doesn't work on the website. Another item is balloons. Putting mylar balloons in as individual items is time consuming and clutters our item list. Putting them in as one item though is less than ideal for online. Having 15 variations of Mylar Balloons on the website in one single item makes it hard for customers to compare different styles side by side.