Choosing accounting software is no easy feat, and making the right choice for your business or start-up, is critical.
- Choosing accounting software is no easy feat, and making the right choice for your business or start-up, is critical.
- Xero Accounting Software
- Quickbooks Accounting Software
- Ready to choose your accounting software?
Accounting software can be a source of frustration for your business or it can become a powerful information base to manage and grow your business.
It has the potential to intelligently anticipate critical turning points, help business owners and managers become smarter and more confident in business decision-making.
But choosing or changing to new accounting software can be a daunting experience and not something to be taken lightly. Platform changeover, staff training, and data migration costs all need to be assessed.
If managed well, it can be an easy and productive endeavour, whilst keeping in mind, that the new system will provide improved efficiencies and better systems.
And deployment pains felt so sharply at first, will pale into insignificance once you see the power and access to new information can hold for your business.
When choosing a new accounting software package, here are 3 key things to consider:
1. Can it provide all the functions I need in my business?
Look at the information all departments within your business need to make them stronger, efficient and grow. Does the software have a good search function to help me find transactions?
Is it easy to use and understand the information available – by this we mean, is it quick to enter information, find information and generate useful information.
2. Is it cost effective?
Will I need to customise the software to suit my business?
And if so, what add-ons will I need to implement?
3. Will it grow with the company?
Look at your business needs today and future needs. The last thing you want to be doing is changing accounting software after a few years when you have outgrown it.
All accounting software requires a general level of bookkeeping and accounting skills, these can all be easily learnt and are highly recommended for any employee – these skills are never wasted, regardless of your position in the company.
Which is the best?
Xero and Quickbooks are two of the most popular accounting software platforms available today, and we are often asked the difference between the two or which one we think is the best.
If your business is considering a change, this can be a complex question, one we recommend is approached from as many directions as possible as there are so many considerations to contemplate; the type of business you run, the industry, the information you want from it.
(Ask about our business health check, it’s a great starting point for this!)
Xero Accounting Software
Xero was founded in 2006 in New Zealand. It is one of the fastest growing software as a service (SAAS) companies globally.
With over 1.4 million subscribers worldwide, they lead the New Zealand, Australian, and United Kingdom cloud accounting software markets, employing a team of more than 2,000 people.
They have a good market share in Australia, New Zealand, and recently returned a 57% subscriber increase in Britain in the year to 31 March 2018. The US market has increased slowly in the last year from relatively flat trading in previous years.
The pros of Xero
- Well-designed software and intuitively easy to use.
This is important especially when you consider the number of hours you may spend on the software and the abundance of information it contains on your business.
We particularly like the dashboard which allows you to see your key information in one place from bank accounts, invoices, and bills, making it is easy to keep track of your finances.
We found its intuitiveness really helped our inexperienced clients quickly get a grasp of the software and those experienced users can explore more options available within the software confidently.
- A wide range of functionality
Functionality gives you more options to enter the information and use this information in your business. From expenses, invoicing, payroll, bank reconciliations, it does everything you need for bookkeeping and keeping on top of your business accounts.
- Great reporting capabilities
There are over 4 interactive reports to use and these can be configured to contain the information you need. There are also performance tracking reports available, so you can really drill down into sections of your business such as departments, products, or income streams.
- Extensive webinar training available online
Xero has many courses available via online, webinars and events, in all sections of accounting and the software. We highly recommend you spend some time, in the beginning, watching these to explore all the capabilities of Xero.
- With over 500 add-ons, Xero has more than QuickBooks
Add-ons are a great way to already enhance great accounting software. You can get industry-specific add-ons in areas like hospitality, manufacturing and education or by task such as payroll timesheets.
The cons of Xero
Xero is more expensive – if it has extra functionality that you don’t need, QuickBooks might be a better option.
With over 500 add-ons designed to improve tasks or provide extra functionality specific to different industries, you may need to budget for these as well.
Customer service is lacking – all support is online, there is no support line to call.
However, their Xero business community is a strong and active source of information & advice and helps you learn from others.
Quickbooks Accounting Software
Quickbooks by Intuit is an American based company with 8300 employees worldwide, in 24 locations and 11 countries.
The company has more than 2.8 million subscribers for its QuickBooks online service. Quickbooks entered the Australian market 4 years ago and as of 2017, had 100,000 users. They are strongest in the US, with 1.9 million subscribers.
Intuit future plans include leveraging artificial intelligence, data and automation for small businesses.
The pros of Quickbooks
- Great functionality
Behind the basic functions of Quickbooks – vendors, banking, employees, and customers and company, you can delve further to expand your accounting and the information you access.
Some examples of the functionality include the use of multi-currency, converting estimates into invoices, job costing, inventory, budgeting, time tracking and exporting and importing.
Quickbooks is particularly good for service businesses where staff and contractors are the main expense items. The payroll function allows you to allocate labour costs to projects for accurate costing.
The homepage consists of a graphical flow chart illustrating the most often used functions and how they flow together. Each main section of the program (Customers, Vendors, and Employees) has its own ‘centre’, a page that provides navigational tools for using its features.
- Great reporting capabilities
Besides the standard one-click reports like Profit & Loss, Balance Sheet, Company Snapshot, customised reports within defined parameters can also be set up, so you can get the information exactly how you want it.
You also have the option to integrate graphs into the reporting, to give users a visual of the numbers and trends.
Reports can be easily shared with your accountant for updates, or with business partners or managers anytime.
- Great mobile app
It has more functionality than Xero, so if you’re looking to do more on the run, it’s the best option.
It can be used offline as well for when access to the internet is limited or to save your data when out of the office. All entries you make whilst offline will be updated once you are back online.
We have found the mobile application is stable and mirrors the user interface of the desktop version for easy navigation. It also allows you to email purchase orders, quotes, and invoices whilst you are out and about, improving your customer service and making your workload more efficient.
- Better value for money
On a cost by cost basis, if the functionality of Quickbooks will do everything you need, it is better value for money.
- Phone support and training available
Even though Quickbooks is easy to use, sometimes you get need a little help, and Quickbooks have a support line you can call on business days during business hours. (1800 046 038 in Australia)
There are also many online training and video support tools available to get you started or if you are unsure how to use any aspects of the accounting software.
The cons of Quickbooks
- The layout of the dashboard isn’t as user-friendly as Xero, and accessing bank account information requires extra steps in comparison.
Ready to choose your accounting software?
When deciding which accounting software to implement, there is no right or wrong choice, it is purely an individual and company preference. It will definitely help to explore the functionality of Quickbooks and Xero, by downloading each of their 30-day free trial versions.
During the trial, play around with the functions, adding real bank entries, invoices, purchase orders, inventory, payroll and view the reports.
This is the best way to see if you find it easy to navigate and has the accounting features your business needs.
Talk to an expert
There are many accounting software packages available in the marketplace and Penguin Management has experience in most of them. If you still need some help choosing which one is right for your business, let’s have a chat – tell us about your business, what you need from your accounting software and we can help point you in the right direction.
Penguin Management is happy to talk you through the differences between the software packages. We know and use these packages every day for our clients from many industries and can help you narrow down exactly what you are looking for in a new accounting software package.
Call us now on +61 2 8298 5301.
Does your business need a health check? This is a great place to start before you move or decide on an accounting software package – a health check helps to improve struggling businesses or make strong businesses even stronger.
Here are some bigger picture actions you can implement to your business into a better position moving into the future or a new financial year – 4 ways to hack the end of the financial year.
And if you found this post useful, please do share it with your network or leave us a comment below.