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What Are The Best Accounting Software Options For Small Businesses?

BY: Marjulyn Mardo
POSTED September 20, 2024 IN
General

Running a small business is no easy task. From managing day-to-day operations to staying on top of expenses and payments, there’s a lot that demands your attention. One area where you can significantly lighten your load is accounting. But here’s the thing: keeping track of finances manually or with outdated methods is a surefire way to lose time and create unnecessary stress. You need accounting software that works for you, not the other way around.

What’s the best accounting software for small businesses? The answer depends on your needs. Whether you’re after simplicity, affordability, or advanced features, there’s an option designed just for you. By picking the right one, you’ll not only streamline your accounting but also free up time to focus on growing your business.

We’ve taken a look at some of the best accounting software options out there, evaluating them based on ease of use, pricing, and features relevant to small businesses. Here’s what you need to know before making your choice.

1. QuickBooks Online: The All-Rounder for Small Businesses

If you’ve ever searched for accounting software, you’ve probably come across QuickBooks Online. It’s popular, and for good reason—it’s one of the most comprehensive accounting tools on the market today.

What makes it great?

QuickBooks Online is a full-featured platform that caters to a wide range of business sizes, but it’s particularly suited for small businesses. It offers tools for tracking income and expenses, invoicing, accepting payments, managing payroll, and even inventory. Everything you need in one place, without being overwhelming.

How easy is it to use?

The interface is user-friendly, and you can customize the dashboard to see the information that matters most to you. Plus, the mobile app is a standout feature, meaning you can check your financials or send an invoice while on the go.

Pricing

QuickBooks Online has several pricing tiers. For small businesses just starting, the Simple Start plan starts at $30/month, but you might find value in higher tiers as your business grows.

Why choose it?

If you want a trusted, all-in-one solution that’s scalable, QuickBooks Online should be at the top of your list.

2. Xero: A Cloud-Based Option With a Modern Feel

Xero has carved out a space in the accounting world by being an entirely cloud-based system that’s particularly attractive to modern businesses.

What makes it great?

Xero shines when it comes to automation. From bank reconciliations to invoice reminders, it helps minimize repetitive tasks. You can also track projects, expenses, and even manage your payroll (with an additional add-on). It’s particularly good for businesses with multiple users—there’s no limit to the number of team members you can add.

How easy is it to use?

The design is clean and intuitive. Xero doesn’t overwhelm you with too many features upfront but makes everything accessible when you need it. Even if you’re new to accounting software, you’ll find it easy to navigate.

Pricing

Xero’s pricing starts at $13/month for the Early plan, which is a great starting point. For growing businesses, you may want to look into their Established plan at $70/month to access more advanced features.

Why choose it?

Xero is perfect if you’re after a modern, flexible, cloud-based solution that works well for teams and automates many of your tasks.

3. FreshBooks: Ideal for Service-Based Businesses 

FreshBooks is another strong contender, particularly if you run a service-based business such as freelancing, consulting, or offering digital services.

What makes it great?

FreshBooks is designed to make managing client relationships and invoices as seamless as possible. It stands out for its time-tracking features and expense management. You can easily log hours worked for each client and generate invoices based on that time. It also integrates well with payment gateways like Stripe, making it easy for clients to pay you.

How easy is it to use?

It’s simple. FreshBooks’ clean interface and automation make it easy to track your billable hours, expenses, and client communications all in one place. Even if you’re not a numbers person, it won’t take long to get the hang of it.

Pricing

The Lite plan starts at $17/month for smaller operations, but most service-based businesses will benefit from the Plus plan at $30/month, which supports more clients and additional features.

Why choose it?

If your focus is on managing client invoicing and time tracking with ease, FreshBooks is a strong choice. It simplifies billing, helping you stay on top of your payments without the headache.


4. Wave: Free and Packed With Value

Not every small business is ready or able to invest in accounting software. That’s where Wave comes in—it’s completely free, making it ideal for solopreneurs or very small businesses that want to get a grip on their finances without breaking the bank.

What makes it great?

Wave offers a surprising amount of functionality for a free product. You can track income and expenses, create invoices, and even accept payments (for a small processing fee). Wave also generates reports to help you understand your business’s financial health at a glance.

How easy is it to use?

Wave’s interface is beginner-friendly. It won’t overwhelm you with options, and most features are simple to set up. The dashboard is also well laid out, helping you focus on what’s most important for your business.

Pricing

Wave is free for accounting and invoicing, though you’ll pay transaction fees for accepting credit card payments (2.9% + $0.30 per transaction).

Why choose it?

If you’re running a small operation or just starting out and need a basic but reliable accounting solution, Wave is the obvious choice. It’s free, functional, and gets the job done.

5. Zoho Books: Great for Integrated Business Solutions

Zoho Books is part of the Zoho suite of business tools, making it a fantastic option for small businesses already using or interested in the Zoho ecosystem.

What makes it great?

Zoho Books offers everything from expense tracking and invoicing to project management and tax management. It’s well-integrated with other Zoho apps, so if you’re using Zoho CRM or other business tools, Zoho Books allows seamless collaboration across your systems.

How easy is it to use?

Zoho Books is intuitive and flexible. While there may be a bit of a learning curve if you’re not already in the Zoho system, the integration options make it easier to manage all aspects of your business in one place.

Pricing

Pricing starts at $15/month, making it a cost-effective solution, especially if you’re already using Zoho’s other business tools.

Why choose it?

For businesses that want an integrated solution that covers more than just accounting, Zoho Books is a great fit. The seamless integration with other apps and the wide range of features makes it a strong choice for growing businesses.


Conclusion

The right accounting software can be a game changer for your business. Whether you need something free and simple like Wave, or a comprehensive, all-in-one platform like QuickBooks, the best option depends on what you value most. Take the time to assess your business’s specific needs, and don’t be afraid to start small. Your future self (and your growing business) will thank you for it!

marj

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