What Do You Need In Your Small Business Accounting System?

Choosing a small business accounting system is a big step toward making sure your small business is running as well as it possibly can. After all, proper business accounting ensures that you’re operating your company effectively, efficiently, and within your budget.

The good news for modern business owners is that modern small business accounting systems put professional-level accounting into the hands of nearly anyone. There are dozens of companies offering the services you need to track budgets, invoices, income, payroll and more. But which accounting system is right for your small business?

In this article, we’ll take a brief look at five of the most popular accounting systems and help you choose which one is best for your individual needs.

I want my small business accounting system to work with my other software.

You may want to try Xero. Xero integrates fully with over 700 business apps, meaning that no matter what other software you’re using to run your business, Xero can track its income and expenses automatically. If you’re accepting payments from Square and PayPal, managing payroll with Paychex, or paying for marketing with MailChimp, Xero will track it automatically.

But integration isn’t Xero’s only strong point. It’s a beautiful app that allows you to pay your staff, send invoices (and accept payment), and see your cash flow at a quick glance.

Xero isn’t perfect. While it’s got a mobile app which allows business owners to run their operations on the go, some customers find the app to be lacking, slow, and seemingly dated. Their customer service has been described as occasionally slow.

But at the end of the day, if you’re looking for highly-integrated software that is strongly recommended by accountants for its ability to put accounting services into the hands of nearly any user, try Xero.

My accounting system needs to have outstanding customer service.

FreshBooks is the way to go. FreshBooks doesn’t have all of the features of some of the other small business accounting systems, but it does have outstanding customer service. The company puts an overwhelming emphasis on ensuring that its clients have an outstanding experience whenever help is needed.

Every employee at FreshBooks starts their time at the company with a full month in the customer service department to make sure that everyone understands the struggles that could occur for its users. That time also means that FreshBooks employees are connected to its users in a tangible, human way.

Speaking of connection, FreshBooks makes a concerted effort to go out into communities in order to meet face to face with its many users, setting up meet-and-greets in various cities where customers can tell the team about their experiences with the software and service.

But outstanding customer service means nothing if the software isn’t strong. And FreshBooks is a great accounting system for many small businesses. If most of what you’re looking for in accounting software is invoicing, billing, and time-tracking, FreshBooks will be a great choice. Their app is also full-featured, intuitive, and attractive.

On the other hand, FreshBooks lacks some more powerful accounting features that you’ll find in some of the other software found here. It uses single-entry accounting, not double-entry accounting, which can become a problem as your business scales up.

But if you’re looking for a simple experience on a smaller scale with a great app and even better customer service, try FreshBooks.

My accounting system must cost as little as humanly possible.

Wave is free. Most of the other software discussed here comes with a monthly fee depending on the software in question and the tasks you require it to do. Wave, on the other hand, can do accounting, invoicing, track your expenses, connect to your credit cards and banks, scan receipts, and more. Completely free.

They do charge small fees for accepting online payment and processing payroll, but those fees are very competitive.

Instead of one catch-all app, Wave offers two mobile apps, one each for invoicing and receipt scanning, which might limit use on the move. Wave also doesn’t offer time tracking or inventory management features like some of the bigger companies. But if you’re looking for a simple accounting system for a small business at no charge, Wave is the way to go.

My accounting system should be pretty solid on every front.

QuickBooks has been the standard-bearer for online small business accounting systems for years. There’s a reason for that – beyond the fact that the company was started in 1983.

The longevity of QuickBooks means that it’s nearly ubiquitous. Every accountant is familiar with the software, and it’s likely that you’ve heard of it as well. That means that decades of users have been troubleshooting, creating how-to guides, and integrating third-party companies and software. There’s a community built around QuickBooks.

As a larger company, there are multiple options for users within QuickBooks. There’s QuickBooks Self-Employed, QuickBooks Online, QuickBooks Online Advanced, and more. With such a variety of options, you can be assured that you’re getting the software that’s best suited for your needs.

All the features discussed with other software are available to QuickBooks users at one level or another. It’s up to you, as the business owner, to decide which features are most important. Do you need multiple users to have access to your books? Do you need to handle multiple currencies? How much money do you want to spend on an accounting system?

The right accounting system is incredibly important to the success of your business.

Regardless of your company’s size, product, location, or plans, it’s vital to choose an accounting system that fits your needs, accounting ability, and budget. Before you choose, take time to carefully assess which features will be most important to you, and if it’s one of the factors listed here, think about starting your search with the company we’ve highlighted for that factor.

Finding new customers, growing a small business, or hiring new employees all starts with regulating and understanding your cash flow, which means choosing a great accounting system for your small business.

Sam Osterling
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Sam Osterling

Sam Osterling is a freelance writer whose work has been published in The Oklahoman, American Way, Renovator Magazine, and Hook & Barrel. Sam writes on small business management, marketing and technology. He’s based on Long Island, New York.