7 Best Accounting Software for Small Business in 2021

One of the first things you will need when running a company is accounting software. From tracking sales and expenses to creating invoices and estimates, these are some of the best accounting software for small businesses.
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Top Picks for Small Business Accounting Software

Regardless of the type of business, accounting for its activities is critical.

There is an ever-growing number of small business account software on the market to help with these tasks.

Depending on your business, finding software that can create invoices and estimates, track time, projects, revenues, and expenses are all things to consider.

Finding the right solution for you can significantly reduce the time you spend on some of the business’s administrative aspects.

This list should help you identify some of the pros and cons of the best small business accounting software out there today.

FreshBooks

FreshBooks is a robust cloud-based accounting system for a small business.  Their suite of tools takes care not just of the accounting itself but also includes functionality to create invoices, organize and categorize expenses automatically, track time for per-hour billing, and create many different reports in a wide variety of configurations. 

It is a comprehensive system that can form the backbone of your business’s financial analysis. 

If you’re on the go, you can use their mobile app to get the information you need right at your fingertips.  It also integrates with over 100 apps to fit seamlessly into your workflow.

As far as cloud-based accounting providers, FreshBooks is one of the best.  It’s been around for a long time, and they’ve earned themselves an excellent reputation.  The customer support is very helpful and is there for you every step of the way.

Pros:

  • One-stop-shop
  • Hundreds of integrations with other small business software
  • Intuitive mobile app
  • Solution-focused interface
  • Sophisticated reporting functionality

Pricing: Currently, there is a special with packages ranging from $4.50to $15 per month.  This is about a 60% discount on typical prices. It’s available for six months before returning to a range of around $11 to $38 per month.

QuickBooks

QuickBooks is the incumbent in the world of small business accounting software. Over the years, they have built an excellent reputation for what they can bring to their clients. 

Their suite of tools is comprehensive and covers everything a small business would need in terms of its accounting.  You can manage everything in one place from their easy-to-use dashboard and mobile apps. 

Some key features include custom invoicing, automated payment reminders, infinitely reconfigurable report setups, automatic importing of bank statements, advanced data security, and much more. 

Every aspect of your financial situation can be managed through this platform. What makes it great is that you can ramp up the complexity to suit your needs.  This means the system maintains its agility and can adapt to your business as it scales.

There’s a reason that they’re considered the market leader by many. It’s because they offer such a great set of tools that can be adjusted and adapted to any small business.  Also, because they’ve been around for so long, their reporting structures and APIs can be accessed and used by a vast range of additional add-ons.

Pros:

  • Strong track record
  • Automated bank reconciliations
  • Powerful invoicing functionality
  • Scheduled payment reminders
  • Strong data security protocols

Pricing: For the first three months, packages range from $7.50 a month for a self-employed person to between $12.50 and $75 per month for small businesses.  After that, it goes up to the standard prices, ranging from $25 to $150 per month.

Zoho Books

Zoho Books provides an integrated platform for end-to-end accounting. It helps you manage your finances, automate workflows, and collaborate across departments. 

You’ll get all the features you need to run a complex business simply and intuitively on their platform.  You can create custom invoices for deals you’re working on, manage your accounts payables efficiently, track inventory levels, connect with your bank accounts, track time spent on projects, run sophisticated reports, and much more. 

Another thing worth mentioning is the range of integrations. They can augment the product and make it that much more helpful.  It feeds nicely into the whole Zoho platform, which incorporates a range of other small business tools.  So when you use them together, you have a fully-fledged cloud-based team at your disposal. 

It’s a great choice at a slightly lower price point.

Pros:

  • Built for collaboration
  • Affordable
  • Lots of integrations
  • User-friendly interface
  • Strong accounts payable management functionality

Pricing: Package pricing is straightforward and ranges from $9 to $29 per month.  This provides exceptional value for money and makes it a strong contender when you’re considering small business accounting software.

Sage

Sage Accounting is a cloud-based platform brought to you by the software behemoth best known for Pastel in the accounting world. 

Their tool allows businesses in all industries to track their finances efficiently in the cloud and manage their invoicing, cash flow, payments, and more from wherever they are. 

They have the same essential functionality as most players in this field and have unique additions that set them apart.  The most exciting one is native integration with Stripe. It helps you get paid quickly right from the invoice itself, which saves you having to chase after debtors. 

In addition, their graphing features make for compelling graphical representations of your data which can make all the difference when trying to get a grip on how your business is performing.

They bring a lot of experience in the space to the table, and you can leverage this for your small business.

Pros:

  • Great data visualizations
  • Stripe integration
  • Cash flow management reporting
  • Automatic expense tracking
  • 24/7 support

Pricing: There are two packages, a starter-level at $10 a month, perfect for self-employed people and micro-businesses. The main package is $25 a month and gives you all the pro features any small business could need.

Wave

Wave is interesting because it brings you a suite of powerful accounting tools for free!  Unlike other providers, Wave’s core functionality doesn’t require you to pull out your credit card. They hope to make their money by selling you on other tools once you’re in the ecosystem. 

The platform itself is well built and includes all the bells and whistles you would expect. This includes invoicing, expense management, cash flow tracking, advanced reporting, and the like. 

They don’t have much of a mobile presence, so you’re restricted to a typical desktop experience. But when it comes to usability, Wave is a great place to start before you commit to any spending.  It’s simple, reliable and secure, and takes a lot of the stress off when it comes around to tax season.

There have been some questions about the long-term sustainability of a service that isn’t a profit-making tool. However, we don’t think that’s a huge deal because these apps allow for importing and exporting of data to other small business accounting software. In other words, it’s easy to make a change if you need more services.

Pros:

  • Free to use
  • Infinitely customizable.
  • Good invoicing functionality.
  • Intuitive dashboards.

Pricing: It costs nothing to use Wave. The whole platform is completely free.  There are no hidden charges or paywalled features, and that’s what sets it apart from all the other competitors out there.

Xero

Xero is one of the better-known players in the online small business accounting software space.  Their offering is comprehensive, well-structured, and simple enough to manage on an ongoing basis. 

The feature list is long and includes billpaying functionality, expense claims, connections to bank accounts, online payment acceptance, project tracking, payroll, bank reconciliations, reporting, inventory management, and much more. 

There aren’t many other services that offer so much in one place.  When used to its full potential, it becomes the hub for your business and can inform all of your decision-making.  You won’t go wrong with Xero; it is a heavy-hitter in this industry.

It’s worth noting Xero has been on the front-end of accounting technology for a while. They’re known for pushing the boundaries with their products.  As the industry shifts towards increased automation and other forms of advanced decision-making, you can be sure that Xero will be at the cutting edge of those developments.

Pros:

  • Payroll integration
  • Advanced expense claim functionality
  • Good inventory management
  • A vast range of features
  • Good track record

Pricing: Packages range from $11 to $62 a month depending on the functionality you’re looking for, and then you’d be looking at an additional $39 per month (regardless of plan) to add the payroll piece with their partner Gusto.

ZipBooks

ZipBooks offers a simple small business accounting software that gives you the tools and business intelligence you need to run your small business efficiently. 

Their main value proposition is that they’ve taken the complicated systems offered by their competitors and pared it down to deliver a simple and elegant solution. 

With ZipBooks, you’ll work smarter, not harder.  Their key differentiator is a sophisticated set of data analytics tools that aim to provide intelligent insights. They do this by going beyond your traditional accounting reports. 

They also have excellent invoicing options to create estimates and invoices with just a few clicks. 

All in all, this solution is an excellent choice for people who know nothing about accounting but still want to pull financial insights from their data.  The business intelligence component alone makes this a perfect choice for a large segment of the market.

While they don’t have the brand recognition of some of the more prominent players just yet, they are growing fast. They seem to be setting themselves up to compete with the best by focusing on keeping things simple.  If you consider how complex these tools can get and how that can lead to confusion, they may be on to something.

Pros:

  • Simplicity
  • Advanced data analytics
  • Business intelligence
  • Free package to get you started

Pricing: There is a free package to try some of the basic features, but you will want to pay for one of the more advanced solutions in most cases. These packages range from $15 to $35 per month.  This would depend on how complicated your operations are and how advanced you want the tool to be.

The Bottom Line

Setting up your accounting system is another critical component of starting a business.

Unless you’re an accountant, it’s typically not the most fun part either. That’s why you should use and accounting software with a proven track record for working with small businesses.

The best solutions have built-in functionality with the needs of small businesses and freelancers at their core.

No matter which software you choose, make sure you do the diligence to ensure it has the features needed for your business.

Paying a couple of extra dollars for the right accounting software can save you lots of time and money down the road.

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