Any business can benefit from modern small business accounting software in a digital business landscape. Reliable accounting software can eliminate costly human errors, help you track your finances and cash flow, and get invaluable insights into your company, which is essential for making data-based decisions.
Finding the best accounting software can be daunting since there are numerous options on the market. However, your business needs will determine the most appropriate software to work with. Here are 10 vital factors to consider when selecting a business accounting solution.
1. General and Industry-Specific Functionality
Regardless of the nature of your business, some accounting needs are cross-cutting. You can start by writing down the core functionalities that are most important to your business. While most accounting solutions vary in advanced functionalities, excellent software can help you simplify basic accounting tasks.
Businesses in different industries may have different accounting and financial reporting requirements. Typically, you can find specific IT solutions tailored for businesses in industries like construction, ecommerce, healthcare, and manufacturing. Understanding the best practices in your industry can help you decide on the most vital accounting functions. If you’re unsure, you can research more about industry-specific needs and options for your business.
2. Integration and Scalability
Regardless of the number of features in any potential accounting solution, it may not offer maximum accounting automation if incompatible with your business solutions, including payroll, shipping, sales, and inventory systems. Consider your tools and determine if the accounting software supports easy integration.
Choosing a software solution that integrates with other business tools can help you save time and achieve process automation. If the accounting software can seamlessly sync with project management and invoicing solutions, you can eliminate manual data entry that often comes with human errors.
If the growth prospects of your business are high, it’s advisable to choose accounting software that can grow with you. Steady business growth means the transaction volume increases over time. In addition, you’ll likely need more functions and multi-user capabilities to accommodate additional accountants. It’s prudent to consider the features you might need in the future and determine if a potential software solution supports scalability.
3. Ease of Deployment and Available Training
If you have difficulties deploying the accounting software, it can be hard to utilize its full potential. While some accounting solutions are simple and straightforward, others are complex to set up. Ideally, you should consider how various options are configured and determine if your technical capabilities are sufficient. You can hire a third party to implement the accounting system, but you will have to pay extra costs.
Some businesses implement accounting systems that employees are not conversant with. This leaves them clueless, as they can’t figure out how to use the solution. Ensuring your accounting team gets the appropriate training once you deploy the software is essential. Sufficient training ensures your employees get the most out of the software, enhancing productivity and efficiency.
If it’s impossible to train the entire team, you can select a few team leaders and ensure they get advanced training from the vendor. The employees with expert training become the go-to resources whenever junior employees face difficulties with the software.
4. Multi-User and Data Sharing Capabilities
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Most business owners find that the stakeholders and volume of transactions increase as the business grows. To ensure seamless access by multiple users, it’s essential to make sure the software has the capacity to accommodate several users working on the same files to enhance productivity.
While some accounting solutions have multi-user capabilities, others may not support multiple users. However, every growing company needs to ensure they can easily activate the multi-user feature whenever necessary. Real-time and seamless sharing between employees and stakeholders can enhance business efficiency and transparency.
Data sharing is vital to any accounting software, but it must be accessible on multiple devices regardless of location. This feature simplifies collaboration among teams in your company since they can seamlessly view and edit the files.
5. Customer Service and Support
Reliable customer service and support are crucial considerations when choosing accounting software for your business. Your accounting team needs quick responses whenever they have issues with the software. It can be daunting to be kept waiting when you need urgent technical support.
Ideally, you should work with a software vendor with a reputation for outstanding customer service and support. You can get a clear picture of the company’s customer service by looking at online reviews and testimonials. Most importantly, it’s essential to determine if you will be required to pay extra fees for advanced support. Great accounting software vendors are serious about customer service because they know clients will need support at some point.
6. Cloud-Based vs. Downloadable Software
It’s important to consider whether the software is cloud-based or downloadable for desktop use. Evaluate the pros and cons of both options and determine which one can be most appropriate for your business needs.
Cloud accounting software is based online and can only be used from a browser. All the accounting data is backed up in the cloud, meaning there’s no risk of losing vital business data if your hardware systems crash. Similarly, users don’t need to update the software on their computers. Instead, cloud-based software will automatically update and back up your business data. Most importantly, cloud accounting solutions facilitate easy and seamless access to financial records and reports from multiple locations.
On the other hand, desktop accounting software must be installed on a computer and can only be used on a specific device. In addition, you have to perform regular updates manually and back up any business accounting data.
7. Overall Software Costs
Cost is a vital factor to consider, and the more features a software has, the more it will cost. Depending on the pricing plan, some options can limit the usage of certain features. Compare different software solutions and determine how much you will pay for the features you want. Most importantly, be keen on additional costs that may come with add-ons. Regardless of whether the software has a monthly or annual subscription, consider the number of limited features that may attract extra charges to unlock.
Some accounting software vendors offer special plans for businesses that want multi-user software. Asking the vendor if they have a custom payment plan for your intended use case is essential. Additionally, some providers offer custom integrations to complement the accounting software capabilities, albeit at an extra cost.
Oftentimes, you will find solutions that are priced based on monthly transaction volume. It’s best to consider your current needs as well as what your business might need in the future. While you can switch your accounting software if your business outgrows its capabilities, it’s often cheaper and easier to upgrade your current system.
8. Reporting Capabilities
Good reporting features are an integral part of great accounting software, as it helps you to track and forecast business trends. Accurate accounting reports can offer invaluable insights necessary to make strategic business decisions. Accounting solutions with superior visualization capabilities can help you understand complex business data.
Some vital reporting features may include profit & loss statements, balance sheets, and cash flow projections. Most importantly, consider the ease of accessing and sharing the reports across multiple platforms for quick collaboration. Depending on your business needs, you can quickly generate standard and custom reports.
9. Security Features
Understanding the security features and backup capabilities of potential account software is vital due to the sensitive nature of the financial data of your business. A good software vendor should disclose sufficient details about their security protocols. Ideally, most small business accounting software encrypts your data to enhance security. While educating your employees and business partners on cybersecurity best practices, the admin should be able to view and edit access and restriction rights of any user.
Similarly, you should consider available data backup options, and the protocols for data restoration in case your business data is lost. Most modern accounting solutions support automatic and manual backups, and others allow you to select different directories. Most importantly, you should be able to configure the backup process based on your needs.
10. Frequency of Software Updates
Accounting software that gets frequent updates is more reliable, unlike those that rarely get updates. Ideally, the accounting solution should keep up with current industry trends to maintain efficiency since new features and improvements enhance customer experience.
Most updates seek to enhance the security of your business, especially since the software deals with finances. Cybercrime is prevalent in the modern business landscape, and hackers are finding new ways to target businesses. It’s essential to ensure you are using accounting software that gets frequent improvements to ensure security and usability.
Good accounting software can streamline and automate bookkeeping processes in your business. This can eliminate human errors and save the time spent on keeping track of business finances. The best accounting software should grow and evolve with your company and inform your financial decisions.
While different businesses have varying advanced requirements and needs, there are basic features that cut across multiple industries. You can plan ahead and define your specific needs to ensure you get a solution that suits your business.