There is no question that a successful business requires solid accounting practices. However, the world of accounting can be quite tricky for small business owners especially if they do not have easy access to an accountant. This is true both when preparing for a year-end or when exploring the idea of selling a business. Most big decisions require concrete bookkeeping to ensure good control of finances and a better understanding of performance.
When thinking of an exit strategy, you will need to evaluate the financial progress of your business including income, debts, assets, and more. However, acquiring accounting support through traditional means might be costly and time-consuming.
Good accounting software for small businesses can help resolve these issues without the need to break the bank. Here is a list of 5 great accounting software and websites that will help you evaluate your small business- whether or not you are thinking of an exit strategy. Below, you will find the costs, services, and advantages of all software. Remember, it is important to do your own research when picking the best accounting service for your business.
Regarded by many as the best accounting software for small businesses, QuickBooks provides amazing accounting services for a reasonable price.
- Receipt scanner that organizes everything about your recent expense through a picture of its receipt
- Third-party integration for apps like Stripe or Paypal
- Mileage tracker to help deduct vehicle-related expenses
- The platform’s design makes it easy to use even if you have no accounting experience
- Easy to set up and get started with guides to help you follow along as you start applying the software to your business
- Customizable to fit your business needs
- Very sustainable as your business grows
- No limits to the number of invoices you can record
- The “EasyStart” package only allows for one user to access the platform, for multiple users you will need to use the “Essentials” or “Plus” tiers
- The “EasyStart” tier does not allow for bill managing and payments
- The “Plus” is the only package that offers project profitability tracking which can be useful when thinking about an exit strategy
The New Zealand-based accounting software for small businesses Xero is very beneficial if your business takes a more collaborative approach to bookkeep.
- Over 800 third party apps to fit your business’ needs
- A hubdoc sharing system that allows for each team member to track their own receipts, share financial documents, and capture bills from their own accounts
- All of the software’s plans allow for unlimited users, meaning that all of your team members can have access to the platform
- If you are worried about entering financial data into a cloud-based service, Xero offers extensive security features to ensure that your business information does not get into the wrong hands
- Affordable pricing for all tiers, with most of the basic needs covered for smaller businesses provided in the first tier
- While the cheapest plan is as low as $11 a month, it only offers up to 5 bill entries and 20 invoices. For a more sustainable plan, the “Growing” plan offers unlimited bill entries and invoices.
- The “Establish” plan offers a project tracking system which can be useful when thinking about an exit strategy
If your business requires a lot of invoicing with a limited number of clients, you should consider FreshBooks as accounting software.
- Automated invoicing makes it faster for clients to pay bills with additional functions to send them reminders and alerts if they are late in payments
- An “at-a-glance” performance dashboard to quickly evaluate your business’ financial performance
- Amazing customer service with real people answering questions
- Easy to use even with no accounting experience
- Invoice software can be accessed using mobile devices and tablets
- Very affordable prices especially if you are only looking for an invoicing and expense/tax tracker service
- The “Premium” tier is only $20 a month and has most of the features that are offered from other services but at a much lower price
- While the “Lite” plan is at an extremely low price, it is very limited in its features
- The “Select” plan is the only one that allows for more than 1 user. If you require multiple users on any other plan you will need to pay an extra $10 a month
While Zoho might offer the most expensive packages out of the 5, the number of features included definitely justify its price tag. It is probably the most in-depth service for accounting on this list.
- “End-to-end” accounting whereby setting up a recurring profile, the software can chase payments, send reminders, and send recurring invoices to customers without you needing to press a button
- Automatic tax calculations for every transaction to create consolidated tax reports that are in accordance with IRS guidelines
- Offers a lot of great in-depth features
- Great tax options that are in accordance with IRS guidelines
- The cheapest plan is very sustainable as it offers features like project tracking, up to 3 users, and a maximum of 5000 invoices
- No accounting knowledge required
- Payroll solutions are not offered in any plan
- Payments like bills and sales orders are not covered using the “Professional” plan
- The most expensive plan offers usage to up to 10 team members
If you own an e-commerce business, GoDaddy might be the service for you. The website-making platform offers a solid basic accounting platform at low prices.
- No manual data entry. By syncing with online retailers (Amazon, Etsy, eBay, Paypal) the software records transactions for you and imports to create up-to-date income and expenses reports
- 256-bit data encryption security, the same as most major U.S. banks
- You do not need any accounting knowledge to set it up
- The entire system is online so you will not need to download any software
- The most affordable solution for e-commerce businesses
- Profit and loss reports and sales taxes reports offered at only a $10 per month
- No automation and payroll features
- Recurring invoices feature offered at the most expensive tier
- For e-commerce businesses only
Conclusion: How to find the best accounting software for small businesses?
When it comes to finding the best accounting software for small businesses, it is important to do as much research as possible. All of the software shown on this list are all great options depending on what you are looking for in organizing your finances. Whether you value collaboration, ease of use, or quality of features, with enough research you can definitely find the accounting platform that is best for you.
No matter what you choose, it is always good to have solid accounting practices to ensure that your business is progressing. Furthermore, if the time comes for you to sell your business, being on top of your finances will show that you are serious about selling and will save you time and headaches down the road when it comes to buyer due diligence.