Best Online Accounting Software for Small Business
As I sit down to write this week’s blog post I’m just a little bit some undecided about how to address the issue of the best online accounting software for small business. This is because the second most important thing (besides making a profit) to a small businessperson is time saving.
You might be thinking what does time saving have to do with accounting software? Well these days, everything.
Accounting has been a time burden for centuries whether you were making entries on late, papyrus, paper or in a computer. Everyone needed to methodically make entries for transactions that occurred for a business. Now however there is a new way. By connecting to banks and downloading transactions no one will need to enter transactions anymore.
This is critically important today, so much so that I simply cannot recommend any accounting software that doesn’t connect to your bank, download and categorize transactions for you. There is simply no need to use old-fashioned software any longer and you should consider such products like QuickBooks Pro cautiously if at all.
That being said, this leaves you with a very small list of software in the United States that can take care of you. All of which are cloud hosted packages. They are automated accounting software that also provides the ability to pay bills and invoice your customers.
Which one is best for you will depend on the particulars of your business. If you absolutely have to do certain advanced accounting functions within the software (and I’ll give you a short list of those in a moment) you will have to use either QuickBooks Online or Xero. The specialized functions include things like payroll, perpetual inventory (as opposed to periodic inventory), job costing, time and billing, and some other less common but specialized needs like a linking a cash register or perhaps restaurant management software.
However, such software features are generally needed only for larger small businesses: those businesses over a million to 1.5 million dollars a year in sales can require their accounting software manage complex internal functions like reordering inventory, keeping track of the time of their employees and applying that to invoices etc. etc.
Frankly companies with these needs aren’t usually small businesses – they might best be called medium-size businesses. Less than 3% of small business in the United States has more than $1 million in sales annually. So what are the other 97% supposed to use?
Well they could use those same packages except there’s a problem: they’re a bit more expensive and quite a bit more complex.
So that’s where accounting software for true small businesses comes into play. At the moment in the United States there are two products that you should consider. One is Wave Accounting the other is Cheqbook (There are others but they are not a complete accounting package and we cannot as yet recommend them).
Wave Accounting is actually from Canada but they have a major focus in the United States. They are a free product except for some add on features that you might need to use. My general assessment of Wave is that it’s okay for the small business owner who has no formal training accounting but your accountant is simply not going to be very satisfied with it.
But don’t take my word for it, look to Greg Lam, the blog writer for the SmallBusinessDoer.com, he likes Wave but he says it’s not quite a full and complete accounting package yet. That leaves our product Cheqbook.
We built it to be functional for the small business owner who is not a trained accountant to be able to do the tasks that they need to do. Additionally we built it to satisfy the needs of their accountant with the features necessary to properly prepare a set of books for their client.
I won’t bore you with all the details of checkbook (this is why there’s an entire website here!) but we believe Cheqbook is the best online accounting software for small business because we’re easy to use, powerful for accountants, and specifically address the needs of real small businesses.