Business & Finance

What Accounting Software Do Small Businesses Use?

What Accounting Software Do Small Businesses Use?

Small business owners like you have one thing in common—you all want to see your business grow and succeed. From an eCommerce store that only has a few products, you want to see more and more sold in your store. But as your business grows, you need reliable accounting software that will keep all your store’s finances in order.

The good news is that there are plenty of tools out there! You won’t have a hard time looking, but you’ll find it a little challenging to choose. If you feel this way, then this article is for you! Continue reading as we share with you the five most reliable accounting software for small businesses. We’ll take a look at the features that set them apart to help you decide, and we’ll also check what they have in common. Let’s begin!

5 Reliable Accounting Software that Small Businesses Use:

It is the presence of the same excellent features that make it difficult to choose among QuickBooks, Xero, Sage50 Cloud/Peachtree, Freshbooks, and Wave. Good thing there are specific offers each software has that set them apart from the others. Here they are.

1. QuickBooks

QuickBooks is one of the few accounting software that offers training for its users. Through the QuickBooks Online Advanced plan, you’ll have access to a variety of training materials that you can learn at your own pace and time. 

If you sign-up for a plan with QuickBooks in the middle of the year, your partner bookkeeper or accountant will handle the backtracking of your data. From then on, your books will always be up-to-date. 

2. Xero

Many software offer reports for accountant analysis. However, Xero, with its Analytics Plus, takes financial health checks to the next level by forecasting future cash flow. You can proactively create actions to ensure you have a bright financial future. 

Meanwhile, you can see your business’s current financial health through an easy-to-view dashboard. You can customize report timeframes and do comparative reports or see trends. You can also tailor-fit reports to your business by getting Key Performance Indicator (KPI) reports.

3. Sage 50cloud (formerly Peachtree)

Sage 50cloud Accounting offers specific accounting solutions for construction and real estate businesses. Their offers are also tailor-fitted for small to medium businesses.

It is one of the few software that offers Customer Relationship Management, Construction, Real Estate Management, and Human Resource Management on top of all the accounting features it has.

4. Wave

Wave boosts confidence when you know that there are expert bookkeepers and accountants you can count on to utilize the software you chose. Wave has an Advisors feature where you will be partnered with their in-house accountants, bookkeepers, and financial coaches. 

These experts will work with you and help you with managing your books, tax computation, and tax filing. You’ll also get bookkeeping, accounting, and financial management coaching, so you can become more confident in being your company’s head of finances.

5. FreshBooks

Meanwhile, while the above-mentioned four accounting software have plenty to offer, some may be too much for those who are looking for just the basic services. Besides, many of the extra offers always come at a price, which businesses on a budget just can’t afford. 

If you are looking for simple and easy accounting software, look no further than FreshBooks. It has top-tier accounting features—more than enough to get you through your bookkeeping and accounting. These tools are available at a lower rate than Freshbooks’s competitors.

Now, let’s discuss the software similarities for you to see that they are all qualified to be your business accounting software.

What Are the Main (Must-Have) Features of Accounting Software?

Here are some key features of accounting software that you should be aware of:

1. Cash-Based and Accrual Accounting

Accounting software should give you the choice between cash-based or accrual accounting. Cash-based accounting is when the money coming in and out of an account is recorded as it happens, while accrual accounting tracks accounts receivable and accounts payable.

2. Invoicing

Skip the hassle of creating manual invoices as the software should automatically generate all the details in an invoice for you. Included in the invoice is a “Pay Now” button for clients to automatically make payments. You can set up recurring invoices to send reminders to customers regularly and on time.

3. Different Payment Gateways

The accounting software above allow creating and receiving payments through various channels. This makes it easier for you and your clients. Aside from the convenience, all the transactions from these channels will automatically be recorded and organized into your books.

4. Taxes

Though you’ll need other software to compute sales taxes and income taxes, they are still organized in one place through the help of your chosen accounting software. As a result, you will see all your data in a single tool, which you can use to run holistic reports.

5. Project and Time Tracking

Accounting software also have project and time tracking features. After collating the time spent on projects, the data can be placed in the payroll system to get the equivalent employee salary or to know how much a project costs.

6. Bank Reconciliation

Accounting software allow bank connections, which record your transactions straight into your books. You can easily reconcile transactions and see which are missing or inaccurate. And if all details are correct, you can run and receive accurate reports.

7. Integrations

Fortify your software, and make it even more usable by integrating these different tools:

  • Ecommerce Integrations
  • Payment and Payroll Tools
  • Tax Software
  • Marketing Tools
  • Data and Document Management Software
  • Customer Relationship Management Tools
  • Inventory Management Data From Various Platforms

Collate all data in a single accounting software, and see everything in one interface.

8. Reportingecommerce

Dashboards are readily available on many of these software solutions for you to see your business’s financial status. Many reports are also customizable to ensure that you will be updated with your business’s key performance indicators (KPIs), so you can make decisions based on data and improve financial performance.

9. Data Security and Accessibility

All the software featured here have data stored in the cloud, so your data won’t get corrupted or lost. Accessibility of these software systems is also role-based. As the business owner, you have control over who can access confidential financial data.

Final Thoughts

The five most reliable accounting software for small businesses are QuickBooks, Xero, Sage50 Cloud/Peachtree, Wave, and Freshbooks. These programs offer similar features, however, there are some differences in the analytics, training, and coaching they offer. 

If you’re looking for a comprehensive yet user-friendly accounting software package that will care for your business’s financial needs, one of these five is sure to fit the bill!

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