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In a crowded field of accounting software solutions, Xero may be just what you need to help you keep your small business on track. It’s simple to use, powerful, easy to understand and eliminates many of the hassles of using an online financial system. Find out how Xero can help you manage your business.
Why Xero is perfect for small businesses
Accounting plays a vital role in any business, but small businesses don’t always have the funds to hire an accountant. Thanks to cloud accounting, there is an alternative for businesses to keep processes in house. We explain why Xero is perfect for small businesses.
For small businesses without a finance team, keeping tidy records can be a challenging task. Already with 1001 things to do, it’s easy to lose track of numbers, misplace invoices, and neglect your tax reports until April approaches. When hiring an accountant isn’t an option, how can you relieve the burden of micromanaging your financial records?
Cloud accounting software can multiply your accounting capabilities with little effort. With real time insights and incredible accessibility, cloud based platforms ensure that you’re never blindsided by your business’s financial health.
Leading the way for cloud accounting software is New Zealand based platform Xero. Launched in 2006, Xero was designed with small businesses in mind. By combining the innovation of cloud technology with beautiful design, Xero has created the perfect cloud accounting solution for small businesses through an easy to use interface backed by powerful AI.
The web based platform has become a top priority for anyone looking to transform their business processes. As of 2020, Xero now boasts over 2 million users globally and is a staple amongst both tech forward accounting firms and small businesses alike.
Here’s why small business owners choose Xero:
<h2 id="<strong>xerohelpssmallbusinessestosavetimeXero helps small businesses to save timeIt’s no secret that accounting processes can be tedious. There are parts of the job we just can’t help but put off. For a small business owner without accounting expertise, menial processes can quickly take an overwhelming amount of time to complete.
The efficiency of Xero means that users can undertake these same tasks with ease and often with no effort at all thanks to automation. Processes that would typically take hours to complete manually now take just seconds thanks to the help of AI technology. No longer do business owners have thoughts of tedious data entry and financial forecasting clouding their focus. Instead, tasks can be automated to regularly streamline processes, with notifications indicating when a job is done. This lifts a heavy weight off of the shoulders of business owners who would much rather spend their time on the growth of their business.
For small businesses owners who are new to accounting, it can be difficult to avoid making mistakes without moving at a glacial pace. Mistakes can cost businesses millions of pounds, but, with a thousand things on your plate, there’s no time to get bogged down in small details.
Xero takes care of all the heavy lifting so you can avoid making mistakes in your bookkeeping. With digital invoicing, data capture tools and automated processes, Xero promises better accuracy and fewer chances for costly errors in your accounting.
<h2 id="<strong>xeroimprovesyourbusiness’cashflowXero improves your business’ cash flowSecuring stable cash flow is vital for any business. Xero can help you to get it right in a couple of ways.
Real time data and clear reporting mean that you can see what money is going in and out of your business at any time. This gives you a better understanding of the state of your finances.
However, on top of that, Xero can make a direct impact on your cash flow by helping you to get paid faster through online invoicing. Customers or clients simply need to pay the invoice online and the money will go straight into your account. You can also set up automated reminders so that you don’t have to chase payments. With more money at hand, you’ll be able to continue the growth of your business.
Flexibility is a core reason that cloud technology has become so popular. As long as you have access to an internet connection, you can log in to your Xero account on almost any device. Xero is cloud based so you’ll be able to accurately view your data in real time. That means whether you’re on a train using your tablet or at home using your PC, you’ll be able to view your finances at the click of a button.
This flexibility is also great if there are multiple people within your business collaborating on your accounts. You’ll be able to work off the same data without having to communicate outside of the app – simply log in and you’re already on the same page. This saves you both time and money as there’s no longer a need to export reports, make printouts, and send (already outdated) files to your partner.
Xero is constantly evolving to offer innovative features
Innovation is at the heart of what Xero does, evidenced by their recognition as the World’s Most Innovative Growth Company in 2014 and 2015 by Forbes. Not only does Xero frequently roll out product updates, but their partnerships with other apps offer a range of new software capabilities each month. This means that businesses are constantly given access to new and exciting ways to keep up with their finances, gain real time views of their cash flow, and keep up with the demands of their business.
<h2 id="<strong>xeroisacosteffectiveaccountingsolutionXero is a cost effective accounting solutionStarting at just £10 a month, Xero is a great tool for small business owners who wish to make their accounting processes simpler, easier, and more efficient.
From handling your processes while you’re running your business to offering unique insights that become more and more intelligent over time, a business that uses Xero is dealt a great advantage in understanding their finances and knowing what actions to take towards success.
Pros
- Unlimited users
- Numerous integrations
- Suited for large businesses
- Advanced features
- Double-entry accounting
Cons
- Learning curve
- Poor customer support
Xero Overview
Xero is cloud-based accounting software based out of New Zealand that has been giving QuickBooks a run for its money since 2006. Xero is a robust accounting solution with sophisticated accounting features, ample reports, 800+ integrations, and unlimited users. Unlike QuickBooks Desktop, Xero also has the mobility and modern UI of cloud-based software.
The software has over 2,000,000 users and is the primary accounting solution for over 16,000 accounting firms. The company has recently added a project management feature, which was one of the most significant drawbacks previously.
However, some of Xero’s most recent improvements have come at a steep cost, and there has been an increase in customer complaints. Xero recently increased its prices, and it no longer includes built-in payroll with its plans. The company has also limited expense claims, projects, and multi-currency support to the most expensive plan. Since our last review, Xero’s customer support has also gone downhill.
While the price may rule out the software for small businesses, Xero still has a lot to offer for medium and large businesses or those in need of multiple users.
Xero vs QuickBooks Online
Xero and QuickBooks Online are two of the most popular accounting software platforms. Here’s our comparison of their pros and cons to help you decide between them.
About Xero
Xero was founded in 2006 in New Zealand and has since consolidated its reputation as one of the top accounting tools on the market. Its tagline is “Beautiful business”, which is the main thing you need to know about Xero: it manages to make accounting sleek and enjoyable. Xero is incredibly user-friendly, simple and powerful, and is designed to help their customers do better in their own businesses via their accounting tools.
Xero has a strong value proposition to compete with QuickBooks Online: its customers love it. Xero consistently gets stronger average reviews than QBO despite a lower quantity of them. With its younger brand image and focus on clean usability, Xero also tends to be more popular in the startup world than QuickBooks.
About QuickBooks Online
QuickBooks Online, the market-leading accounting software from Intuit, offers “Smarter business tools for the world’s hardest workers”. With their cloud-based system, businesses can streamline many of their repetitive tasks and processes by managing bills and invoices, tracking projects, and even tracking miles automatically with a smartphone.
QuickBooks claim on their website that 98% of customers say that their solution helps them run their business more easily, and we can see why: there’s a reason that QBO has built such a solid reputation.
QuickBooks has been in the market for longer than Xero, is very well-developed, and is generally loved by accountants – especially in the US market, which QBO has dominated. QuickBooks has an estimated 80% market share in the US. QBO claims that customers find on average $3,534 in tax savings per year.
What’s the difference between QuickBooks and QuickBooks Online?
QuickBooks is Intuit’s general accounting software, while QuickBooks Online (QBO) is specifically the cloud-based service. For QBO, you pay a monthly subscription rather than an upfront fee, and you get all the patches and software updates from Intuit. In this article, we’ll mostly refer to QuickBooks Online, which is what we think you’ll likely opt for instead of Intuit’s desktop version of QuickBooks.
QuickBooks Online is rated 4.2 out of 5 on Capterra by 3520 users, while Xero has an average of 4.3 from 1880 users.
Conclusion
Xero is a cloud accounting software solution designed specifically for small businesses. It helps you manage your finances anytime, anywhere, so you can focus on what matters. Get started today with your free 30 day trial of Xero accounting software.