We need to embrace this technolution.
As a bookkeeper, I encourage my clients who do not want to pay an accountant to invest in accounting software and encourage them to take the decision seriously. Chosen well and utilized appropriately, your software can be one of your best business tools, yet software chosen in haste can quickly become the bain of your existence (or at least feel like it).
Common Rookie Missteps in choosing accounting software:
- choosing based on price alone
- choosing a software because your bestie uses it
- choosing based on marketing and hype
- not choosing any software because you are overwhelmed
Yes, you need to find a system that fits your budget. Of course you will want to learn about what others are using in their business. Don’t let overwhelm or overconfidence lull you into a state of inaction. Even though you are the business owner you are not the only stakeholder in your accounting system. Banks will want reliable data in order to make lending decisions, governments require accurate recordkeeping in order to be in compliance with tax legislation, and customers may require access to their historical records or account balances. Not to mention accountants will charge you hourly to prepare reports, statements or tax remittances all based on the information recorded, (or not) in your application.
5 things to consider when choosing your accounting software:
1.Are you a Mac or a PC?
You may be surprised to learn that even with Apple’s increased market share the choice of software, especially desktop software, is still limited for Mac. Even more so if you are operating outside the US. When I got my first mac I didn’t even think about my accounting software. I was so in love with my new baby it was a few days before I realized the system I had been using for years was not compatible. The result was a frenzied search for new software I could use on my new system. I did find something and it turned out to be great. However, my lack of foresight cost me. The new software was significantly more money and I had to spend hours migrating my data to the new platform and I lost easy access to all of my historical data.
2. Desktop vs. cloud.
There is a major trend in software as a service (SaaS) right now. Instead of going to a local retailer and buying a single use, CD licence for a needed program, you can now purchase a subscription for an online (cloud hosted) version of the same program. By breaking the cost of the program into a monthly fee the investment in your accounting system is now really accessible. Plus, programs are constantly being updated, and with cloud based services you always have the most recent version. However, if you decide to discontinue your subscription you will lose access to your information after a set period of time and you must have a reliable internet connection in order to access your information.
It is important to consider what your business needs are going to be in 6 months, 1 year and 5 years. That invoicing app that let you works with up to 25 clients for x dollars may suit you as a solopreneur right now, but will it cover your needs when you have employees, sub-contractors, sales tax, and passive income products? Choosing a true double-entry platform may feel like more than you need right now, but it is important to base this decision on how well the platform can grow with you. I have been through software migrations, they aren’t fun or easy.
Does the software you’re interested in work with other software? You want to choose an accounting system that works well with everything you are already working with. If you need payroll, the ability to integrate becomes a huge deal. Now, the beauty of integrations is that there are so many and so many people doing it really well. Also, consider which features are included at each price point: think multi-currency, purchase orders, inventory management, and number of users. The whole point of integrations is increasing efficiency, doing more in less time.
Great user design is not just about something looking pretty, but also the day-in and day-out user experience. Does the software work well and is it relatively easy to use? Does the software allow keyboard shortcuts (a huge timesaver)? Can I complete a task (or figure out where to go) in less than 10 seconds? Try not to get sucked in by hype.
There are two ways I recommend making the final decision:
First, trial at least 3 different platforms, most (if not all) software companies will give you 1 month free to put them to the test. Use this time to futz about. Check out the customization to see how easy it is to set up for your business. Make mistakes and see if you can correct them. Try out the integrations to see if they work well. Second,consult your bookkeeper or accounting professional. This will allow you to have a conversation about the features and benefits unique to your business. The other benefit to working one-on-one with a professional is they can offer insight you may not have even considered yet. Not to mention a well-trained bookkeeper has already put the software through the paces which can greatly reduce your own learning curve. Stay tuned to hear which software I recommend. Until next time, I would love to hear from you.
Have you ever invested in a system and then quickly regretted it?