Is QuickBooks the only game in town when it comes to small business accounting software? No one can question its popularity—QuickBooks claims to have 80% market share and over 2 million users.

Some small business owners, however, prefer other software. Let’s talk about additional accounting programs you should consider.

First up, what does accounting software do?

These are the 7 most common functions:

  1. Invoicing
  2. Purchase orders
  3. Bill management
  4. Payments
  5. Expense tracking
  6. Financial reports
    • Profit and loss statements
    • Income statements
    • Cash flow statements
    • Balance sheets
    • Customer balance summaries
    • Accounts receivable aging summaries
  7. Inventory management

What small business accounting software offers an alternative to QuickBooks?

FreshBooks

Website
Lite plan: $6/month
5 billable clients
Plus plan: $10/month
50 billable clients
Premium plan: $20/month
500 billable clients
Custom pricing for 500+ billable clients

Xero

Website
Free 30-day trial

Early plan: $9/month

  • 5 invoices and quotes
  • 5 bills
  • Reconcile 20 bank transactions

Growing plan: $30/month

  • Invoices
  • Quotes
  • Bills
  • Reconcile bank transactions

Established plan: $60/month
Features of Early and Growing plus:

  • Multi-currency
  • Expenses
  • Project tracking
  • Customers can pay from invoice with PayPal, Stripe, Apple Pay.

Zoho Books

Website
Free 14-day trial

Basic plan: $9/month

  • Maximum of 50 contacts (customers and vendors)
  • 2 users
  • 5 automated workflows
  • Bank reconciliation
  • Custom invoices
  • Expense tracking
  • Projects and timesheets
  • Recurring transactions
  • Sales approval

Standard plan: $19/month
Features of Basic plan plus:

  • 500 contacts
  • 3 users
  • 10 automated workflows
  • Bills
  • Vendor credits
  • Reporting tags
  • Purchase approval
  • Budgeting
  • Twilio integration

Professional plan: $29/month
Features of Standard plan plus:

  • 500+ contacts
  • 10 users
  • 10 automated workflows/modules
  • Purchase orders
  • Sales orders
  • Inventory
  • Custom domain

Wave

Website

  • Free accounting software designed for entrepreneurs
  • Fees for payments: 2.9% + 30 cents per credit transaction, 1% per bank transaction
  • Multi-currency
  • No limits on transactions or users
  • Intuitive interface

Fun fact: In July 2019, Wave was acquired by H&R Block for around $400 million.

Did we mention that Wave is free?

For comparison, here is the pricing for QuickBooks:

Self-Employed plan (for freelancers): $5/month.
For small businesses there are four plans:
Simple Start plan: $10/month
Essentials plan: $17/month
Plus plan: $30/month
Advanced plan (6 or more users): $60/month

Most small business accountants and bookkeepers are familiar with QuickBooks. There are over 50K accountants/bookkeepers who have been certified by QuickBooks as QB Pro Advisors.

If you choose a QB alternative, make sure your financial people are okay with it. If you haven’t hired an accountant or bookkeeper, you can choose your software first. Then find an accountant who is familiar with your software.

For New Business Owners

Starting your first business? Congratulations! We wish you success. Here is some basic information you should understand before choosing accounting software.

What is QuickBooks?

QuickBooks is the most popular accounting software for small business.

What is the difference between QuickBooks and QBO (QuickBooksOnline)?

Before cloud computing, QuickBooks was sold as a product you installed on your business computers. You paid a one-time upfront cost. You used the software for a few years and paid again if you upgraded to the latest version.

With QBO, the software is housed on Intuit’s (the company that makes QuickBooks) servers.

This method of delivering software to customers is also called Software as a Service or, more commonly, the acronym SaaS. SaaS is pronounced ‘sass.’

What is the ‘cloud?’

The cloud is another name for the internet. With cloud computing, software is housed on remote servers hosted on the internet. You access the software with a web browser.

How do you pay for QBO?

Software hosted in the cloud works like a subscription service. Instead of buying the software in a box and paying once, you pay a monthly fee. The software described in this post is cloud-based as well.

By Liz Strikwerda