How Malcolm Turnbull Got So RichMay 18, 2017
Switching to Xero
If you’re reading this, you’ve heard of Xero and you’re wondering if it’ll be any good for your business.
What’s so special about Xero? From an accountant’s perspective, it just works.
It's a great piece of software that makes tracking your revenue and expenses so easy and turns tax time into a breeze.
But you're a smart user and know that Xero's not the only software claiming to do this. Xero’s two biggest competitors in Australia are MYOB and Quickbooks.
Here’s how they measure up.
For years, MYOB was the gold standard in accounting software. You bought a copy at the local Officeworks. At tax time you emailed the file to the accountant. However, accounting has now shifted to the cloud.
MYOB was very late to the party and their systems are slow, clunky and complicated for some.
If MYOB was a car, it’d be your uncle’s 1992 Holden Commodore with the heavy clutch and scheduled maintenance every three months. It used to be good but now you wonder why he still keeps it around.
Quickbooks does a lot of the same things that Xero does. However, it doesn’t seem to invest as much time and money into product development and customer service.
The interface isn’t as intuitive as Xero, there’s not as much functionality, customers have reported system outages and it’s not as easy to get help when faced with a problem. To retain customers and grow the base, Quickbooks offers lower prices and frequent discounting. At the end of the day, you get what you pay for.
If Quickbooks was a car, it’d be a 1996 Daewoo. Cheap as chips, gets the job done, but it doesn’t have aircon and the fuel pump is making funny noises.
Xero’s a relatively young company. However, while other providers were resting on their laurels, Xero got involved in the business community and took input from accountants into building something businesses really need.
Xero has also created an ecosystem of addons. Third party software providers can build industry specific apps that link to Xero. For example, restaurants can use a Xero addon that helps them take orders, process payment and track which dishes are most popular.
While other providers have followed Xero, it’s still unmatched in terms of usability and customer experience.
If Xero was a car, it’d be a late model Toyota Camry. Not cheap, but reliable, easy to drive and good for a growing family.
The fun part is, by installing addons, you can turn it into a custom Lexus..
So the question on your mind is “what’s the cheapest?”. Accounting isn’t typically sexy and you just want to pay for what you use. However, if you’re serious about running and especially growing your business, there’s a more important question. How much is a good system worth?
A good system will let you focus on actually running the business. When you need to manage your expenses, pay your employees or do tax reporting a good system will just work. You won’t put off your bookkeeping because it’s annoying and you won’t have that feeling in the back of your mind. You should feel a sense of pride when doing your financials.
While both providers have different pricing structures, let’s look at a typical business which has 3 employees, invoices customers, sends purchase orders and pays bills.
For this business, Quickbooks online costs $35 per month. By comparison, the equivalent Xero plan is $54 per month.
What that means is that for an extra $228 per year you get the absolute best software on the market that will save you hours of work.
It’s a no brainer, isn’t it?
We're all about making things simple for businesses. If you'd like to learn more, fill your details in the contact box on the right to receive our FREE business owner's guide to navigating taxes. We've made it easy so you know how to stay out of trouble.