Accounting packages for small business is a hot topic these days, so I’ve done some research and decided to share my findings with you. Some people may feel that there are only two options when it comes to accounting packages for small business: Quickbooks or Xero. While both of these options are good for small business, they aren’t the only solutions out there. There are other reputable accounting packages that can also be great choices.
Lots of small business owners are searching for the answer to these questions. They want to know if Xero is good for medium-sized businesses. That’s why I decided to write this article about xero accounting packages. Hopefully by reading this article you will learn what the best Xero accounting packages are for your company.
As a software solution, Xero’s operational capacity is not affected by the scale of the numbers involved – 1 invoice of £1m or 1 invoice of £1 both take the same amount of processing. Instead, what matters most is volume.
Xero’s capabilities in coping with a high volume of transactions came into question at Accounts and Legal HQ when Kiko Cosmetics, a national retailer with circa 50 stores nationwide, got in touch to see if we could help improve their reporting processes and speed up management accounts production.
Kiko’s previous outsource provider was quite traditional in their approach – resorting to manual solutions in many cases. Furthermore, the existing Sage 50 software had run out of steam and become temperamental.
It was immediately apparent that the company’s new Head of Finance was open minded and ready to hear innovative solutions. They had investigated a Sage 200 upgrade, but were also aware that sister companies in the group were successfully using Microsoft AX.
Nonetheless, they were not ready to adopt Microsoft AX in the UK. So, we proceeded to dig and probe around other systems that existed before one of the team bit the bullet – “why don’t we use Xero?”.
In front of the prospective client’s eyes a live debate ensued between the pitch team as to whether Xero could work. This impromptu discussion was followed by general agreement that it might and was probably worth a try. Not really the conclusion to fill a prospective client with confidence.
Back in the office, one bright spark in the room suggested we just ask Xero directly, so we did. Their response informed us that the soft limits for transaction volume are around 2000 sales, 2000 purchases and 4000 bank lines per month, after which Xero’s performance “deteriorates dramatically”.
Not suitable for larger businesses
Generally Xero is time consuming (except reconciliations), poor UI for quick glance info and some basic reporting, missing basic features that are part of nearly ALL other desktop and online competitors. Just read feature requests to get an idea of it’s lacking features in more specific detail.
We have recently converted from QB to Xero… frustrated and disappointed. It’s really not suitable for larger or complex businesses. So many small but crucial features are not there, are not suitable, time costly or faulty. We’ve invested to much in the change over and feel it would be too hard to now go back. I really hope Xero picks up the ball and makes changes quickly. The recent update was appalling with very little real progress. I see a big future for Xero, but only if they can fill in these holes
The benefits
So what do businesses get out using this service? The main plus point is based around efficiency. One of the key barriers to growth for small businesses is inefficiency. And doing the accounts is one of the key areas in which businesses waste time.
Xero allows you and your staff to keep up to date with accounts and services from anywhere. There is no need to drive back to the office to upload or download information. It’s all accessed on the move. You can look up the necessary financial information wherever you are, using any computer, smart phone or tablet.
Most of the time-consuming manual processes are also redundant. So put your calculator and ledger in a draw and forget about them. Xero pulls information from bank feeds, generates invoices and automates the whole process. This streamlining of the accounting process can help small and medium businesses to save time and money.
Collaboration
Building effective working relationships takes energy, time and understanding. Coming to terms with how your colleagues operate can be a testing period. But if everyone is on board with the same platform, then it’s not such a big deal. Using Xero, you can collaborate in real time on financial data, helping to create a more efficient group dynamic.
There’s no sending round long email chains and having to locate necessary figures on spreadsheets. It’s updated in real time and everyone has access, no matter where they are. Multiple people can work on any account at the same time which helps to speed up the decision-making process and reduce bottlenecks.
Security
Of course, the safety and security of your financial information is paramount. Xero takes your private information very seriously indeed. That’s why they lock it all away behind a wall of up to the minute technology. It prevents all unauthorised entry to sensitive information and guards against systems failures.
If you’re a small business and don’t have an IT department or adequate IT security, then your financial information is always at risk. Xero offers the benefit of an increasingly secure online presence, with dedicated professionals looking after your online security. Your accounts will be guarded with passwords, firewalls and third party inspections.
The cloud
You’ve probably heard a fair bit about the cloud in recent years, unless you’ve been living with your head in them that is, and for good reason. This technology is really unlocking a lot of potential for small and medium businesses. It’s levelling the playing field and makes doing business that bit easier for companies with limited funds.
By deploying the potential of the crowd, using services like Xero, small business are working smarter. Taking the information stored in Xero, it is possible for businesses to get a clearer picture of what they are strong at and the areas they need to improve. It helps them to think about their next phase of growth and gives them access to sophisticated technology that was once the preserve of large multinationals.
Xero gives businesses a real time view of how they are doing. There is no waiting until the end of the month or year to do the accounts and see where you stand. It is a constantly evolving and updated process and one that is accessible from anywhere on the planet. Making better informed decisions is now a real possibility for small and medium businesses.
Conclusion:
If you’re a small business owner, chances are you’ve already heard of Xero. But if you haven’t, you should find out more about this accounting software for small and medium-sized businesses. With almost 4 million users, Xero is one of the most popular accounting software solutions for service professionals.