Best Accounting Software For New Businesses
Unless you’ve been in business for a while, or you have a trusty bookkeeper on the tools, accounting software might seem overwhelming, or just not important. It might even feel premature to invest in whiz-bang software when you’re not earning much at the start.
I got some advice when I launched my own business and it was to start how you mean to go on. If you want a thriving, sustainable business that is prepped for growth, you need the systems to support you. If you have no plans to expand your weekend side hustle, your set-up could look quite simple. The bottom line is if you are earning money, you’ll need to report on it and pay tax. Either way, accounting software will support you. The beauty of the platforms on offer is that they each offer different packages to suit your stage in business.
Today, I’m going to give you an honest review of the wide variety of accounting software on offer. So that when you chat with your good friend Google to find the software of your dreams, you don’t just go with the first one mentioned 😉.
Plus, if you read on to the end, I’ve got a little something just for you if you’re new to this business/numbers game.
Xero
I’m going to give it to you straight here, Xero is by far my preferred (and only) accounting software. It’s professional and if you’re wanting to look after it yourself in the start, really user friendly. If you want to track expenses, process payroll, report on income, and produce comprehensive reports with ease, Xero is your new BFF. Integration wise? It connects with multiple banks, PayPal, Stripe, and even HubDoc to record receipts and expenses + so many more. It’s a winner.
Recommended for: Businesses of all sizes ⭐️⭐️⭐️⭐️⭐️
Cost-wise, Xero has you covered. Most of my clients are on the Premium plan but if you are a sole-trader and are just starting out, the Starter or Standard plan is more than enough.
MYOB
MYOB was the leader of the pack many years ago and yes, it offers most of the features of Xero but in my humble opinion, it’s not nearly as efficient with less integration and automation available. It’s widely used by larger businesses with multiple departments with many employees or specific inventory needs.
If you’re new to business and you haven’t been trained in how to use MYOB, it can take a little to learn.
With a wide pricing bracket, from $24 to $150 per month, there’s levels to suit you and it can be affordable and usable for small businesses but it’s not my personal preference.
Recommended for: Medium to Large businesses ⭐️⭐️⭐️
QuickBooks Online
QuickBooks is a robust software option that enables you to track income, expenses and report on your business finances. It does have merit but I find the expense coding and bank integrations clunky and when working with new clients, I always strongly suggest Xero over QuickBooks for this reason.
As with the others, different options are included in each package. Starting at $22 a month, it’s cost-effective with the very basics. As your business grows, be wary not to use the Sole Trader version, as this is a stand alone app and you can’t upgrade as you grow, you get to start all over again. Payroll is a winner here for QBO, it can do more than the basics. That aside, Xero outshines QuickBooks in the long run.
Recommended for: Sole-Traders and Small Businesses ⭐️⭐️⭐️
Features Snapshot
So which platform wins out? Drum roll, please….Xero! By a country mile.
Of the features I’ve put in my snapshot here, you can see that all the same things are included, depending on which plan you’re on of course, but the option is available.
You might then be wondering, what is the difference?
And the difference is the interface and what is actually available, how automated and streamlined things are, and what your business really needs.
Xero is amazing at automation & integrating with all the things, Quickbooks not so much and MYOB I don’t believe integrates with much at all.
MYOB doesn’t have nearly as much automation, but the ‘newish’ online version is always growing and changing.
Quickbooks has a lot of room for error with a lot of clearing/unallocated accounts. It’s hard to find where things are.
Xero’s inventory and payroll are basic. It has the function but performs the minimum requirements to tick that box – which works beautifully for nearly everyone. If you’re running a super large e-commerce business and you need strong inventory, I’d suggest connecting to a really good app or add-on. Options like Shopify, Vend or Neto. With KeyPay, Deputy and Microkeeper being great for payroll!
They all do the functions we need them to, so it really comes down to you!
All that aside, I love Xero and know it pretty well inside out. I became #TeamXero only after using them all side by side for so long, it was the superior option with a seamless process for both me and my clients.
A Note On Wave Accounting
Wave Accounting was widely used by freelancers but as of 2020, it no longer integrates with Stripe which makes getting paid difficult. It’s aimed at tracking income rather than expense tracking with BAS and Super management being near impossible. The Australian market is also not supported anymore and bank feeds, well non-existent!
I would not recommend this platform for any Australian business, including hobby businesses.
There are other free/low cost alternatives kicking around – heard the saying ‘you get what you pay for’? I would steer clear – why do you want something free with minimal to no standards looking after your money ??
Recommended for: Overseas freelancers ⭐️
Bonus
If you’re serious about setting your business up the right way, hopefully with Xero, I’ve developed a few tips over on my blog.
Need more help? I’ve got you covered!
My signature course, Power In Numbers is launching again in January 2022! It’s a 4-week group coaching course where I’ll personally teach you how to:
- Be all over setting prices for your products or services
- Setup your processes to know exactly what and when to do your numbers
- Be clear on things you HAVE to do
- Understand reports to spot the numbers you love to look at
- Grow your numbers
- And, MORE!
You can join the waitlist here and you’ll be the first to know when it opens.
