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3 Main Factors When Choosing Small Business Accounting Software

3 Main Factors When Choosing Small Business Accounting Software

It’s official, you’re a business owner! You know because you have more paperwork than you know what to do with. Let’s face it, if you enjoyed admin, you wouldn’t be where you are today. So how can you conquer the time-sapping, desk-burying pile of invoices and receipts? With small business accounting software of course!

Choosing accounting software is extremely necessary, especially if you run your own show. To make the process a little easier, we’ve summed up some things you should know into three useful points. You’ll also get a super quick rundown on some of the popular accounting packages out there.  

Benefitting From Accounting Software for Your Small Business

When it comes to running a business, efficiency is key. The right software will help you cut down the time you spend on daily accounting tasks. Since the main point of any company is to turn a profit, keeping a close eye on the financial health of your business is crucial. 

When you automate more of the tedious tasks, fewer administrative mistakes slip through the cracks because there’s less room for human error. (Inventory control errors are a big one.)

Additionally, all your financial tasks can be conducted on the same platform. If your business is small, you may not have the budget for an accountant, but the right software means you can handle your own accounting tasks while your business grows.  

Here are a few ways that small business owners can use accounting software:

  • Recording payments 
  • Tracking expenses
  • Customer invoicing
  • Reconciling transactions
  • Gain a better understanding of their profitability 
  • Prepare for tax season

Basically, accounting software saves time, makes your business more efficient, and saves you money in the long run. Plus, it gives you a good perspective on how your business is doing financially.

Perhaps you’re wondering how you should go about choosing the right accounting software solution. The three important factors you’ll want to consider are integrations, the needs of your business, and added features.  

1. Small Business Needs

First and foremost, you’ll need to take a serious look at your business as a whole. Be mindful of how it runs, its limitations and possible growth potential. You’ll also need to think about the industry you operate in and the number of employees you have.  

Here are a few questions you’d do well to answer:

  • How often do you receive payments?
  • Do you process online payments?
  • Can you do the bookkeeping on your own? 
  • Do you have employees?
  • Is your business retail or service-based?

The idea is to be realistic about the extent of your accounting requirements. Additionally, consider how much support you will need in setting up and learning your new software. Several software platforms come with basic training to help you get started.

2. Accounting Software Features

There are a few features included in small business accounting software packages that you’ll want to look out for. The suggestions below will help you plan what you need. 

  • Customisations and Future Growth

Think about the features that are immediately relevant as well as those that will be helpful later on.

If you run a small business, your accounting needs might not be all that extensive. You could work away quite happily with only the basic functions and not give a second thought to customisations. However, when your business grows, your accounting needs will change. 

As your company expands, in time you’ll find yourself needing an enterprise resource planning (ERP) system. While that might be something to tackle down the line, it’s a good idea to think of where you’d like to take your business and align yourself with the right software providers early on. 

You’ll want an option that scales with your business growth.  

  • Online Access

Cloud-based accounting means you can access your information from anywhere. As we learnt from the COVID-19 pandemic, being able to work remotely involves more than just freedom. When unforeseen events occur, your business doesn’t have to shut down if employees can’t get themselves to your place of business. 

  • Add-Ons and Maximum Value

Some add-ons aren’t completely necessary, but they make a difference when you know how to use them. For example, they can make reporting easier and your workload smaller. 

To determine if the software has any useful add-ons, it’s always a good idea to read the finer details. Learning how to use the full functionality of your accounting solution will help you maximise its value.  

  • Affordability

Of course, being able to afford your accounting software is going to be a significant deciding factor. Free accounting software does exist. However, it’s not worth skipping a paid-for accounting solution if it has features pertinent to your business.

While you need to be reasonable, accounting is no frivolous expense. So if you think your business needs something more than the absolute basics, don’t hold back. In the long run, accounting software is an investment in the growth of your enterprise.  

3. Accounting Software Integrations

You’ll want your accounting software to integrate well with other business solutions. In other words, your accounting package must link up with the software you’re already using, such as your payroll system. It makes life much easier when your accounting solution can automatically populate information.

Integrations are especially important if you use a POS (point of sale) device. Make sure those two are aligned. After all, the one receives your income and the other records it. If you end up having to manually capture your POS entries, that pretty much defeats the purpose of automatic reporting.

In short, make sure your accounting software will be compatible with other aspects of your business. 

Speedy Software Review

If you’re looking for a good small business accounting software in South Africa, there are a couple of popular options to look at. We’ve put a speedy review together for you to get an idea. 

QuickBooks Online

QuickBooks has a strong reputation and is considered the best option for small business accounting software. It’s easy to find their training and support resources if you need them. Plus, there are customisations available on the different plans that you can match to your business needs. 

Sage

Sage is great because it integrates well with Microsoft and it has some very useful customisations. It has the hybrid option of hard-drive-based software that can also share data with the cloud. 

Xero

If you’re self-employed with a really small operation, Xero is the way to go. Its platform is simple and straightforward to use. Additionally, it integrates well with payroll software as well as Stripe and GoCardless for online payments. 

Wave

If you’re a one-man band such as a creative freelancer, Wave is a really good solution. It’s perfect if you only send out basic invoices and don’t need payroll. And, its reporting saves you all the time you don’t have when tax season comes around. More importantly, it’s free to use. 

Data Capture for Days

If data capture isn’t your thing, that’s okay! Getting your accounting software right means you can spend more time making money and less time worrying about invoicing. With not too much effort you can even run a super organised operation.

You want to keep track of your expenses and know how much your profits are. Small business accounting software will help you manage your turnover. It will also save you a lot of time and hassle.

The best thing is, you’re the boss so you get to make the decision! If you’re interested in a great all-in-one accounting solution, chat with Omni Accounts today!