Buying Small Business Accounting Software
Often times, people go out and buy small business accounting software like Sage Simply Accounting or Quickbooks based on a quick price evaluation. However, this approach cannot be any more wrong. It makes no sense to purchase small business accounting software before you properly define the specific tasks that you want the software to address, or even before you try it out first. Think about it, you don’t purchase a car before taking it on a test-run, then shouldn’t you do the same for software that’s going to handle all of your financial management?
The best plan of attack when choosing accounting software is to first make a list of all of the tasks that you need the accounting solution to do. The small business accounting software should be able to handle that list of responsibilities at the very least. One of the first considerations, is whether you will need a complete small business accounting software solution, or if what you need is a light accounting solution that just helps you keep track of your cash flow.
In the end, it all really depends on how in-depth you want to get with your financial management. If you choose a robust small business accounting software package then you will be able to see exactly how your business and investments are doing, and you will be able to generate several detailed reports. However, if all you really care about is who owes you money, or whether you are on budget, then you can settle on a lightweight small business accounting software application.
Small business accounting software, for the most part, should handle the obvious needs such as accounts receivable and payable, tax reporting, and expenses. But if you are looking for your small business accounting software to have extended capabilities such as CRM, inventory management, business intelligence, or sales management, you will have to start looking towards Enterprise Resource Planning (ERP) software or small business accounting software with strong integration capabilities.
After deciding what features you need your small business accounting software to have and what specific tasks you need it solve, the next step is to start comparing vendors and different software packages. Once you have devised a list of vendors and software, then you are ready to try them out and make your small business accounting software purchasing decision.
An accounting software, any, is a one size fits all general purpose tool that is suitable for a small number of businesses: businesses that have a simple business process such as retail store, wholesale business, restaurant, small repair shop, etc… An accounting software, be it QB, PT, SA, ACCPAC, etc… is unsuitable for a large number of businesses: businesses that don’t have a simple business process.
SMBs don’t realize this because their current system is so patched up and clunky that the problem has been blurred and buried ten feet underground.
The simple and undeniable fact is that if spreadsheets didn’t exist, the usefulness of your accounting software would drop by 50%, and in many cases the accounting software itself would simply be unusable.
Why is it so? The answer is simple: An accounting software is an accountant’s tool, not a business tool and as such its function is very limited. The best proof that its function is limited is this: In the majority of businesses, users spend a significant amount of time and effort extending its functionality with multiple spreadsheets, databases, 3rd party add-ons, electronic files, etc…. in order to bridge the gap between accounting and their company’s business processes. QuickBooks payroll is no longer adequate? No problem, new spreadsheets are created and maintained by the payroll person or an addon is purchased. The sales process is getting more complex and your MS Dynamics or Sage can’t handle it or is too complicated or heavy to reconfigure? No problem, another series of spreadsheets or a database is created by the sales department. The result is a system that is patched up and stitched from nearly every side. That’s the type of result you get when you use a screw driver to drill holes. Messy and painful isn’t? The astonishing part is that users do it naturally without questioning this nonsense. The not so surprising part is when a business commits the sin (they all do) of asking their CPA or a system reseller to suggest a solution, he/she almost invariably recommends another brand of screw driver,… and life goes on.