QuickBooks Online – Still Our Top Pick for Small Business Accounting Software in 2021

Often times I am asked by new (and not so new) business owners, “What do you recommend I use to keep track of my business transactions?” Do a search for accounting software and you will be overwhelmed by the options. However, despite the wide array of options out there, QuickBooks Online is still my top pick. Here’s why.

Using PC Magazine’s Top 10 Small Business Accounting Software picks for 2021, I began my evaluation. Their top 10 were, in no particular order:

  • QuickBooks Online
  • FreshBooks
  • Sage
  • Wave
  • Zero
  • ZohoBooks
  • GoDaddy Bookkeeping
  • QuickBooks Self-Employed
  • Sunrise
  • Kashoo

Small Business Accounting Software

If you are a small business owner that is serious about your business and you are not a hobbyist, freelancer or independent contractor (like a real estate agent or insurance agent), you should eliminate three of these right off the bat. Basically, they are checkbook registers that group your transactions by category but do little else. Those three are:

  • QuickBooks Self-Employed
  • Sunrise
  • GoDaddy Bookkeeping

If you are a hobbyist, freelancer, or independent contractor, these may be viable options for you. However, proceed with caution on any of these. Make sure they will deliver what your tax preparer needs and what the IRS requires for documentation. Reporting is very limited, and your accountant may request a balance sheet which typically isn’t available in this type of software. Also, be sure that the software can grow with you and migrate or upgrade easily as the requirements of your business change. For instance, QuickBooks Online Self-Employed cannot be upgraded to the regular version of QuickBooks Online should you ever find that the self-employed version is no longer adequate for your needs. Finally, “BUYER BEWARE.” Some of these offer free versions of their software.

Be Wary of Free Accounting Software Versions

I have two warnings for you here:

  1. If they allow you to connect your bank account to feed in your transactions, please think twice before giving access to your bank account to “free” software. I am not implying that any of these have less than honorable intentions, I am just saying this as a general security precaution in any capacity.
  2. If they are free, they have no obligation to deliver. That means they could close up shop at any time without warning. You potentially could be left with no financial records for your business. Perhaps this is an unlikely scenario, but why take chances with something so important?

We are now left with:

  • QuickBooks Online
  • FreshBooks
  • Sage
  • Wave
  • Xero
  • ZohoBooks
  • Kashoo

QBO Outperforms the Competition

Ask any business owner who has tried to find a good bookkeeper and they will tell you it is a daunting task at best, especially finding one who has experience with your accounting software. I don’t know any actual statistics, but I can tell you that in my 22 years of being an accountant, I haven’t met one CPA or bookkeeper that isn’t familiar, or at least somewhat familiar, with QuickBooks. In fact, there are over 200,000 QuickBooks ProAdvisor Accountants worldwide.

In my eight years of being in business, I have come across one client using Xero. At the time, I obliged for a short while. Eventually, their accounting advisor and I agreed that it was time to switch to QuickBooks online for better reporting capabilities and a more streamlined process. I do have to say though that Xero has made some improvements since then and seems to be giving QuickBooks a run for their money. I have been wanting to revisit this software for some time now, but haven’t been able to find the time. I will say if there is a second runner-up to QuickBooks Online, Xero would get my vote.

Sage, FreshBooks, Wave, ZohoBooks, Kashoo

It has been several years since I last used Sage, but at the time, I wasn’t as impressed with it as I am with QuickBooks. However, PC Magazine does recommend Sage as its top pick for businesses who manage inventory. I have to agree that I tend to avoid the inventory feature in QuickBooks Online. It works well enough, but it can be a bit clumsy at times, especially for the inexperienced user.

I have not used FreshBooks, Wave, ZohoBooks or Kashoo. Up to this point, I don’t know any bookkeepers or accountants who work with them. If someone who has been an accountant for 22 years has not come across anyone using them, it is unlikely there is a wide network of professionals who know how to use this software. Remember how I mentioned earlier how difficult it can be to find a good bookkeeper who knows your software? I assure you, it would be an even bigger challenge if you were looking for an expert in these four options. You may not need a professional accountant who knows this software now, but what about in the future as your business grows?

In addition, I know Zoho as a contact management database. There are plenty of examples of businesses out there who deviated from their area of expertise, only to find failure. I’m not saying this is true of Zoho, but I am generally leery of those who are a jack-of-all-trades, master of none.

Why I Choose QuickBooks Online

If these reasons weren’t enough, I choose QuickBooks Online because:

  • They are a national, if not a world leader in small business accounting software. They have been perfecting it for longer than I have been in my career. They really listen to their ProAdvisors’ suggestions on ways to make their software even better. I have seen many of my feature requests come to fruition over the years because enough of us asked for them.
  • QBO learns and categorizes over 70 percent of transactions, saving small businesses an average of 11 hours each month.1
  • Small business owners who use QBO get paid twice as fast as those who don’t.1
  • 83 percent of QuickBooks customers say they are more confident about their financial data.1
  • 89 percent of small businesses say they are more successful when they work with an accountant. Intuit uniquely brings those two groups together serving 300,000+ accounting professionals worldwide, with 600,000+ QBO customers now linked to a QBO Accountant customer.1
  • Did I mention there are 200,000 QuickBooks ProAdvisor accountants worldwide that are dedicated experts in QBO and ready to help you?1

Contact Us for a Professional Consultation

So, despite all of the emerging accounting software solutions out there, what do I say when someone asks me, “What do you recommend I use to keep track of my business transactions?” My answer is still QuickBooks Online.
If you have any questions about QuickBooks or a specific software you are considering, you can visit our contact page and click on the Request a Call button and we will be happy to answer any questions you may have.

Source: 1 Chris. QBO Surpasses 2 Million Global Customer Milestone. Retrieved from https://quickbooks.intuit.com/blog/thought-leadership/more-power-2-you-quickbooks-online-surpasses-2-million-global-customer-milestone/.