01Which Accounting Software Features Do You Need?
Narrow down accounting software choices by making a list of small business accounting features you need to run your business. Most of the small business accounting features include:
- Inventory management
- Sales tracking
- Manage customer contacts or work with your current contact management software
- Merchant account support to accept credit card payments
- Business tax reporting
Industry-Specific Accounting Software
Some accounting software is designed specifically for industries such as construction, manufacturing, and wholesale distributors. If your small business is in an industry with specific accounting requirements, there may be accounting software with features to meet those requirements.
Talk to Others About Accounting Software
Before you buy accounting software, talk to at least three other people who use accounting software in businesses that are similar to yours. Discuss what they like about their accounting software and what needs improvement. You may find that there is no perfect accounting software out there, but do not be discouraged. The goal is to find accounting software that best meets your small business needs.
02More Accounting Software Considerations
Now that you have narrowed down your accounting software choices carry this list of questions with you while you shop for small business accounting software.
Will the Accounting Software Grow With Your Business?
Find out if the software has modules you can add later if needed. A module that is commonly added after a business grows is for payroll accounting.
If modules cannot be added, does the software upgrade easily to a more capable version of the same accounting software? Or, does the software export to a data format such as CSV so it can be read by should you switch to another accounting software title later?
What Accounting Software Supports Your Bank Support?
Being able to download transactions from your bank saves a lot of time, so find out what accounting software your bank works with.
Online or Desktop Accounting Software?
Online accounting software is web-based software that runs securely through an Internet browser. Online accounting software is especially convenient for accessing accounting data and records from multiple computers.
Can Access Be Restricted for Some Users?
If more than one person is using the accounting software, one individual may need full access to all functions, but others may only need access to data entry areas and not reports.
Does the Accounting Software Come With a Free Trial?
It is always best if you can try the software before you buy it. To see how useful the software documentation is, click on Help in the free trial, then look for a user guide or tutorials.
03Accounting Software Support Options
Remember to figure support costs into your accounting software budget. Some accounting software provides fee-based support by email or phone from the moment you start using the software. However, it is common for the cost of small business accounting software to provide support at no cost for a set period of time so you can ask questions when you first start using the software without incurring additional expenses. After that time period, you pay for support annually, quarterly or on a per-use basis.
The accounting software may have a free online user forum where you can ask questions as well. It is often a good option to fee-based support when your question is about how to use a feature.
04Don't Pay for Features You Won't Use
A smaller, less complex business needs fewer features than a larger business does. Remember the question in Step 3 regarding upgrading or adding modules to the accounting software later? No matter how irresistible extra "whistles and bells" seem, resist the temptation to buy more accounting software than you need.
Generally, you pay more for more features in accounting software and if your business grows enough to need more robust financial features, the cost is justified. For smaller businesses, there are now enough accounting software options available that over-buying is unnecessary.
05Use an Accountant or Accounting Software?
Accounting software does not replace an accountant for ensuring that your business adheres to legal and accepted accounting and tax practices. But, when you use accounting software, you take every day accounting tasks out of the hands of an accountant, which saves money for a small business.
Good any accounting software will have the reports you need to give to your accountant on a monthly, quarterly and annual basis. Either the reports can be printed or they can be delivered securely to an accountant electronically.
Ask your accountant what reports are needed and be sure you can generate them with the accounting software you are considering.
Tips for Choosing Small Business Accounting Software
Using accounting software saves hours of time compared to handling the books manually and is usually more efficient than using a spreadsheet. It is because accounting software reduces or eliminates redundant data entry, like entering the customer's address on the quote, then the work order, and then the invoice.
If you are a sole proprietor with no employees, low or no inventory and a handful of customers, you may not even need accounting software, or there are free or low priced accounting software options available. Small business owners who carry inventory, have more customers or employees will save time and have more accurate records if accounting software is used.
Most accounting software is much easier to use than it once was, and some small business accounting software was designed for ease of use by a person with no accounting background at all.