Accounting Software Buyer's Guide
No matter the size of your organization, accounting software can vastly improve the manner in which money, assets and other financial aspects are taken care of. From basic cloud-based solutions to intricate bespoke software, there are countless options out in the market.
Features of accounting software consist of but aren’t limited to:
- Invoicing and billing
- Payroll management
- Tax calculation
- Stock and inventory management
- Sales and purchase orders
- General ledger
- Financial reporting
Types of accounting software by complexity
(i) Low-end market
Fundamental accounting software that consists of all basic features shall fall under the low-end market range. This can include online SaaS platforms that run on a subscription basis, which are ideal starting points for SMEs and businesses that operate from home. What’s more, low-end accounting software solutions can also be used for monitoring personal transactions, such as household expenses.
A notch or two above its low-end counterpart, mid-market software products include additional features, ideally those that can be bought as a bundle or independently, for your specific business requirements. Some mid-market applications also present functionalities that enable them to be smoothly integrated with other forms of software, thereby providing the option to create a holistic ERP system that is affordable for smaller businesses.
(iii) High-end market
Accounting software products that are exclusively customized or developed specifically for certain industries fall under this category. Targeting larger corporations, high-end accounting applications present features that are uniquely developed to cater to specific business objectives – and as a result, are more expensive than the rest.
So, which solution is right for you?
With accounting software available to suit any known business requirement, there’s bound to be a solution that is just right for your organization. In order to determine this, first ask yourself:
What accounting problems need solving/objectives need to be met?
Analyzing where your shortcomings are and what needs to be fulfilled is the best starting point to determine which accounting software is right for your business. For instance, you may need a system that shows you key statistics on the financial health of your company, and any areas that need to be addressed in the likelihood of a loss.
Discussing the matter with important staff members in your company can enable you to comprehensively identify what goals different members are intending to meet in terms financially, and how an accounting software can help bridge those gaps.
Things to consider before buying accounting software
The accounting software you eventually choose will solely depend on the objective(s) you need to achieve. The features you therefore require can be found over an online, subscription-based solution or via bespoke software (which will take longer and cost more as it will be exactly tailored to match your business’s needs).
For companies that are growing over time, it is also imperative to consider how scalable your software is capable of being. If your software can’t keep up with the expansion of your company, chances are that you will need to shift to a completely new system later on which will cost you time, effort and money in the long run.
This is one of the most important things to consider when it comes to accounting software. Ultimately, your company’s bottom line matters the most, and making your accounting software be part of a fully-fledged ERP system will help you learn about various financial aspects pertaining to your company, all from different angles.
Fusing your accounting software with other departmental automation systems such as human resources, customer relations, marketing etc. can help you gauge the profitability ratios of your company – both independently as business units or as a whole.
While there is no ballpark figure when it comes to deploying the right kind of accounting software for your business, prices can range from as low as $5 a month (for inexpensive subscriptions) to thousands of dollars for a tailor-made product. Several factors weigh in on determining how much you will eventually need to shell out.
Of course, software systems custom-developed to meet your company’s accounting requirements shall be most expensive. However, low to mid-tier systems (while comparatively less expensive) may require paid add-ons, which could drastically increase your bills over time.
Again, this depends on several key factors pertaining to the software you have selected for your business. One major point to consider is whether your software (and its data) is being stored over the cloud in a third-party host’s server, or in a private server that is owned and accessible only by your organization. The latter definitely requires more effort, time, money and external hardware for set-up, but compensates for the big investments by providing enhanced security for your data.
Another factor that affects the time and effort required for implementation is training; depending on the complexity of your accounting software, staff members who are due to be using it may require education on any technicalities involved. Therefore it’s advisable to allocate some extra time prior to formally launching the operation of your software, as a contingency.
How to search for accounting software that’s best for your business
(i) Do your research
As mentioned above, discussing what your business’s specific objectives are in terms of accounting should be the first course of action. Once you have figured out what exactly you need, it is time to…
(ii) Explore your options
Now you need to scrutinize software products that are available in the market, in relation to fulfilling what your business requires. Hit a search online or ask accounting professionals you know for some of their favorites, to give you an idea on what’s out there.
(iii) Request a demo
Speaking to brand representatives of the software you are interested in will give you an insight on how their products can be streamlined to suit your business. Most brands offer free trials that last up to a month, which your business can take advantage of in order to determine how the software will be beneficial towards meeting your specific objectives.