If you are someone who has just entered the accounting software market, you might be feeling overwhelmed by all the options available out there. There exist a number of alternatives for all types of accounting, invoicing, bookkeeping, to track expenses, making financial statements, financial report, understanding cash flow, accounts payables, etc.
There are a lot of amazing online accounting software like Zoho books, FreshBooks, profitbooks, etc.
Two of the biggest names in the world of cloud accounting tools are Xero and Quickbooks. Both these software options offer powerful features and services such as invoices, budgeting, payrolls, etc.
In this article, we have got everything that you need to know about these two software, so that you can easily decide whats best for you.
Well consider accounting features software has and understand the pros and cons, pricing, support network, and other key features so that by the end of the article, you can figure out which accounting software is worth the investment for your business.
- Xero and Quickbooks in a nutshell
- Parameters used to compare the software
- Pros and Cons of Xero
- Pros and Cons of Quickbooks
- Heres why you should use Xero
- Heres why you should use Quickbooks
- Support Network and Customer Service
- But how much will it cost you?
- Why is ProfitBooks a better option?
- So which software to go with?
What is Xero?
Founded in 2006, in New Zealand, Xero is an excellent online accounting software suite that allows its users to coordinate and manage all their financial processes and complete their accounting needs.
The software utilizes a modern cloud network and has an easy-to-use platform that is accessible from all kinds of devices across the globe.
What is Quickbooks?
To make accounting easy for small businesses, Quickbooks Online, offered by Intuit, is another cloud accounting software.
The software has amazing essential features such as creating and sending invoices and estimates, tracking expenses, and payments, managing P&L, and balance sheets, and a lot more. It also integrates with around 80 other applications making it an efficient software to work with.
Following are some of the factors that we have considered to compare these two software in the accounting market.
- User Interface
- Range of features
- Value for money
- Customer Support
- Mobile applications
Pros and Cons of Xero
- Simple and elegant user interface
- Efficient payroll management
- Batch payments
- Powerful integrations with multiple complimentary applications
- Fair pricing
- Graphic reports and charts are unavailable
- Random bugs make the UX unpleasant sometimes
- Customer service can be better
Pros and Cons of Quickbooks
- User-friendly interface
- Strong integration with other systems and flexibility with third-party applications
- Provides good accounting reports
- Easily accessible through other devices
- Lacks some advanced and business-specific features
- Needs improvement in multi-user features
- Needs more invoice design tools
- Limitations on the number of transactions
- Mobile application needs to be more robust
- only suitable for international businesses as they are closing Indian operations.
Heres why you should use Xero
Xero has a fixed asset manager that calculates and keeps track of the depreciation on your types of equipment and machinery. This helps a business to claim the exact gain or loss while disposing of the asset.
Doing business with multiple users without much hassle can be possible with Xero. If your business has a large team of accountants and bookkeepers to work on the books, Xero can be a great option for your business.
Small business owners
If youre starting something new or own a small business on a budget, Xero can be the optimum option for your business. The software is ideal for small business owners as it helps them manage their accounts independently, offering a lot of features at a lower price.
Heres why you should use Quickbooks
Live customer service
Unlike other accounting software, QuickBooks has excellent live customer service via both telephone and live chat. Therefore, if your business team requires continuous or frequent support and service, Quickbooks is an ideal option to go with.
If you want to integrate your accounting software with other software and apps, Quickbooks wont disappoint you.
With more than 650 integrations, Quickbooks integrates with most of the small business software in the market that has any sort of financial functionality. It works well with other apps, letting you handle all your business operations on one platform
Strong reporting capabilities
QuickBooks is a great business accounting software option for a business that is set to grow and expand. If your business requires strong reporting capabilities and wishes to have an edge in running down complicated and advanced reports, Quickbooks would turn out to be a great option.
Support Network and Customer Service
Requirement and dependence on the support and customer service of the software depend from business to business. A cloud accounting software support team should aim to deliver the highest standards of expertise and services.
Some business owners, who like to work through a hiccup on the phone, should prefer Quickbooks as their business accounting software. The support network and live customer services through both, telephone and live chat, makes it a great alternative.
This service offered by Quickbooks is available from 6 a.m to 6 p.m PT throughout the business days and also from 6 a.m to 3 p.m on Saturdays. Whereas, the customer support offered by Xero, despite being available 24/7, is sometimes difficult to access.
But how much will it cost you?
Choosing the right plan for your business becomes a crucial factor. The features that a small business requires might not be sufficient for a large and established business.
Therefore, depending on the requirements of the services and features, a business should carefully choose the ideal pricing plan for the software.
Here are the pricing plans for both Xero and Quickbooks, so that you decide whats best for your needs.
All the pricing plans cover the basic helpful features and functionalities. But if you wish to have optional add-on features for your accounting needs, there are two more plans that Xero has to offer. With essential features, Xero offers three pricing tiers, from $12 to $65 per month, as mentioned below.
- Early: $12/month.
- Growing: $34/month.
- Established: $65/month.
The Early plan is perfect for sole traders, new businesses, and also the self-employed. If you own a small growing business and need to carry out transactions in bulk, you might go with the growing plan.
Xero also has a priced plan called Established, for established businesses, that, along with the standard features, offers in-depth analytics.
Quickbooks has announced that it will be discontinuing its services and products in India as of April 2023. Its accounting and all other services would work seamlessly outside of India. Here are the pricing plans that they have for the same.
The priced plans for Quickbooks come in four different tiers with different features and versions. The subscribed users can switch their plans at any time according to their needs.
- Simple Start: $25/month
- Essentials: $50/month
- Plus: $80/month
- Advanced: $180/month
Why is ProfitBooks a better option?
is one of the fastest-growing and most powerful online accounting software in the market, doubling down as invoicing software. With profitbooks, you can create beautiful invoices. You can also do inventory management of all your supplies in various locations. Profitbooks also offers payment gateways for receiving online payments.
With profitbooks you can manage your accounts easily, the interface is so user-friendly that even without any knowledge about accounting, you can still be able to take care of all your accounting needs.
The software has a free version as well as a paid version and unlike other software, you can use the free version of software forever, even while you use the free version you can use features like expense tracking, inventory management, online payment gateways, financial reporting, digital payments, etc.
Moreover, many features that other software like Xero and Quickbooks provide in their priced plans are included in the free version of ProfitBooks. Such features, without a doubt, make ProfitBooks a better option to consider.
So which software to go with?
Xero and Quickbooks are two of the most popular and powerful cloud accounting software out there. Although both have their own advantages and perks, both software has some differences and inconsistencies that your business might or might not be compatible with.
Xero has more affordable plans that would suit small businesses or the self-employed. But if your business has advanced and complex requirements, you would need software with more enhanced features. In such cases, a business can go with Quickbooks which has features to work with multiple vendors and customers.
In this article, we evaluated Xero and QuickBooks across several accounting parameters and features. There is no one-size-fits-all thing in the world of accounting.
Software that turns out to be an ideal option for a small business just might not be a great choice for an established firm. Its better to do your due diligence before choosing whats best for your business.