If you find your business is spending more time than you’d like managing the books and dealing with unwieldy spreadsheets, then accounting software may be the right choice. By reducing - or eliminating - the need to constantly re-enter the same data on multiple forms, you can save time as well as your sanity.
Accounting software is a good option for small businesses that tend to carry inventory, serve a relatively high number of customers, and employ more than a couple of staff.
Thanks to advances in software, most accounting programs on the market today are more user-friendly than ever before. Even people with no background in accounting will find the learning curve quite easy to navigate. Here are some things to consider if you decide to invest in small business accounting software.
Decide which features you will need
Your decision on which software to invest in will rest in large part on the features you decide are necessary for your purposes. Common features available in accounting software are:
- Business tax reporting
- Credit card payment support for merchants
- Customer contact management support
- Sales tracking
- Inventory management
It is also possible to find accounting software that is specific to your industry. For example, if your business is in hospitality you may be able to locate a software package that is tailor-made for your needs and includes features specific to your industry like meal price estimating, managing perishable food supplys and employee tipping management.
Questions to ask yourself before purchasing accounting software
Do you need software that will grow with your business?
If yes, then you should look for a package that will allow you to add in modules at a later date. Payroll is a popular add-on once businesses start expanding.
If you can't add modules to the existing software, look for a package where you can upgrade to a different version when you need different features. At the very least, make sure whatever software you purchase enables you to export data in CSV format that can be easily read by other software. This enables you to integrate your old data with the new, when you make a switch to different software.
Does your bank support a particular brand of accounting software?
It can be a massive time saver if you can download all of your banking transactions and import them easily into your software program.
Do you prefer a desktop or a cloud based solution?
The need for cloud-based solutions is growing as businesses come to recognize the value and convenience of being able to access accounting software from multiple devices and across multiple locations.
Do you need to be able to restrict access for some users?
If you have several people who will be using the software, but only one person who needs to be able to have full access to every function, then you will want to include this feature in your list of requirements.
Do you want to be able to try out the software before buying it?
Then look for a solution that includes a free trial period. However, it’s often very labour intensive to implement an accounting system, so you need to be pretty sure before you invest your time.
With some accounting software, you will need to purchase support, while other providers will include it at no extra cost (at least for a designated period). This could affect your costs, so keep it in mind when making your decision.
Make sure that you are not paying extra for features that you will never use. As mentioned above, you can always upgrade later if you find that your business has grown to the point where you need them.
It is important to remember that accounting software does not replace an actual accountant. If you need to ensure that your business meets legal standards, you should consult with a certified accountant.