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9 Factors to Consider When Choosing Accounting Software for Small Business

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Estimated reading time: 5 mins

When choosing the right small business accounting software, you want to select the best one right out the gate. That way you won’t have to deal with the headache of realizing your selection doesn’t offer the accounting software features you need, ultimately returning to the hunt for a better option. This could not only lead to valuable time lost but also dollar signs down the drain. 

Without the right receipt tracking software or the best online invoicing software, your business finances won’t be in tip-top shape to operate with the efficiency you need to streamline financial tasks and drive your business forward. 

Finding the best small business accounting software that provides all the tools you need is vital to success. So if you’re wondering how to choose accounting software, here are some important aspects to consider.

Functionality

Before starting your search, make a list of the accounting software features you’ll require from your small business accounting software. Will you need to audit inventory? What about efficient receipt tracking software so you can easily add project expenses to customer invoices? Would it be beneficial to have a time-tracking app to easily record hours? Will you need to create estimates for customers and track those estimates against actual invoice totals? Having multiple tools that fluidly work together makes your life easier and your bottom line bigger.

Scalability

The more your business grows, the more you’ll need accounting software features to work for you. Let’s say you start selling arts and crafts at local events as a side hustle. What if that side hustle turns into more and you end up selling at regional shows, too? You may even eventually open an online store that sells and ships worldwide. 

As you scale your company, you’ll need small business accounting software that can keep up, providing tools such as multi-currency functionality, receipt tracking software, and easy-to-read reports, so you have a clear picture of your profitability and cash flow.

Cost

While a free small business accounting software sounds tempting, chances are even a cheap version isn’t going to supply the accounting software features you need to accurately assess and run your business. For example, does your free version have the ability to produce payroll? What about the option of receiving digital payments? And will it save you time invoicing, or will you have to manually enter everything? 

While online accounting software may have a monthly fee, it will gain you functionality and fluidity. Plus, it’ll save you time. And every small business owner knows time is money.

Compatibility

Online accounting software can connect directly to your bank, allowing for automatic downloads and categorizing of your transactions, freeing up time you would normally spend entering expenses. It also gives you the ability to upload or email receipts directly to the software, helping you easily pair the paper trail to the proper expense — no paper files required.

Remote backup

While not retaining that physical receipt might sound intimidating, you can rest easy knowing all your records are safe and sound in your remote storage. If something should happen to your computer, such as a system crash or office fire, you can simply pull all your finances from the cloud and forge ahead with less stress.

Security

Choose small business accounting software from a reputable company with a history of innovation. You don’t want to share your banking information with a unsecure, start-up. Additionally, if your business grows and you end up hiring multiple employees who need access to financial data, your software should allow you to assign the right level of clearance to individual workers so your private information stays that way.

Ease of use

Don’t select an accounting software that has you Googling how-to tutorials. Of course, there will be a learning curve with any new system, but make sure that educational time doesn’t lead to lost profit. 

Remember: Accounting software is supposed to make your life easier. To see the inner workings of small business accounting software before you buy, try out a demo to ensure it has straightforward accounting software features and reporting functions. If you can’t easily produce a profit and loss statement, you may want to keep looking.

Accountant-friendly

Even if you track your own finances, it’s always a good idea to have a certified public accountant on your bench. That pinch hitter can come in handy when tax time rolls around or if you have questions about the best way to organize your business finances. Ask your accountant for their recommendations on how to choose accounting software and what options they recommend. They’ll likely suggest one that gives them remote access to your records so they can file your taxes without breaking your focus.

Invoicing 

This monthly task can require significant time to divvy up things like employee hours and project expenses. And that’s not including the hours it takes to create invoices, send them, and receive and process payments. Select an option that includes the best online invoicing software, allowing you to seamlessly add project expenses and hours with the click of a button. The software capabilities also should include sending of digital invoices that accept credit card payments. Once your software receives those payments, it should automatically mark the invoice paid, deposit the funds to your account, and enter that deposit into your ledger. The question is: What are you going to do with all that saved time?The right small business accounting software makes all the difference. It will help you spend less time running your business and more time growing it. With accounting software features like receipt tracking and invoicing, you can easily track expenses, view reports, receive payments, and pay taxes in a timely, organized manner, leaving you to focus on improving your products and services and strategizing your business development goals.

 

About the author /


Simon is a creative and passionate business leader dedicated to having fun in the pursuit of high performance and personal development. He is co-founder of Truthsayers Neurotech, the world's first Neurotech platform servicing the enterprise. Simon is also an Ambassador for Gloucestershire business. Simon is an Associate Member of the Chartered Institute of Professional Development and Associate Member of the Agile Business Consortium.

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