Tracking the financial side of any business can be a lot of work. But understanding the numbers is essential to success. You don’t have to manage the money on your own, there are several software options that will help improve and measure business financial activities. This is one of the early and important decisions that every business must make. Don’t hesitate to take advantage of free-trial offers before jumping in. The financials are the lifeblood of the business so before you start shopping here are 5 things to consideration when selecting accounting software your small business.
Ease of Use: Ask yourself how easy it to use the program. The interface and navigation should be simple and self-explanatory. There should also be an option for data back-up. I personally like to purchase from companies that offer help at no additional cost, have reasonable service plans or offer tutorial training that walks me through the most popular business tasks and transactions. If the program is not easy to navigate, it will be installed on your computer but you will never want to use it and you don’t want that to happen.
Features: What your software offers you is an important consideration. Make a list of the primary things that you need to track and account for. You must know how much each service or product costs and be able to track your cost of goods sold (COGS). Features like invoicing, online payments, payroll, auto payments, reporting, bank balances will help you stay up to date on your small business income, expenses and where you may need to make adjustments. Narrow the choices and compare program features by using the accounting library’s free software selection tool.
Compatibility: If there are other financial tools that are used in your small business – for example, a POS or ecommerce system, then you want to look into the compatibility of your financial software with any other essential software to run the online or storefront portion of the business. In an ideal world, you want a solution that provides most of what you need in one program. If you must have multiple software packages, make sure that the data can automatically be linked for real-time updates or transferred daily with the upload of an Excel or CSV file.
Collaboration: In many companies, knowing the numbers is a team effort. Consider a software program that allows you to have several users including a financial manager, accountant and bookkeeper. Billing your clients is core to how you get paid and it shouldn’t be overwhelming. Although you or your bookkeeper may be the ones operating the software on a daily or weekly basis, it makes tax time easier and keeps you organized until you’re ready to hire an accountant.
Price: While price is a factor it shouldn’t necessarily be the deciding one. The ability to manage your money is far more important if it’s the difference of saving just a few dollars. What you should be aware of is the different pricing models that used by software products. For example, you can purchase Quickbooks software for a one-time fee of $249, or use their online version which starts at $12.95. Freshbooks is a cloud software and has monthly pricing options that start at $19 per month for up to 25 clients or $39 a month for unlimited clients.
Having software in place, will allow you to stay on top of cash flow and focus on what you do best. You won’t have to create a duplicate for yourself, and it keeps your records clean. People who don’t manage their household with a budget won’t manage their business with a budget. Businesses that don’t make decisions based on up-to-date financials don’t make many dollars and that doesn’t make much sense.
“Finance Calculator Shows Revenue Income And Success” courtesy of Stuart Miles / www.freedigitalphotos.net
What accounting software are you considering and why?
Great post. Thanks!
Also, I would have to mention Xero’s beautiful accounting software. Cloud accounting is making things ridiculously easy for business owners and it benefits CPAs and bookkeepers as well, because they don’t have to pay for multiple seats.
There really are a lot of things that you have to look into when choosing the right accounting software for your business. I particularly like that your article brings up the features as one of the big things to look for. After all, you want to make sure that the software you choose has all of the features that your business needs.