As a business owner, you know that the success of your business depends on efficient management of the business finances. And the best way to do this is by using accounting software. But there are many different types of accounting software available, and trying to decide which is right for you can easily overwhelm you. Read on to discover how to choose the right accounting software for your business.
Types of Accounting Software
Before you start looking at accounting software for your business it helps to know the types of accounting software available. And this is useful whether you’re a new business owner just getting started or have an established business that needs to upgrade to something more powerful. And rather than looking at these and wondering which one is superior to the rest, you should rather consider which one is able to meet the needs of your business. Today, and into the future as your business continues to grow.
- Desktop accounting software: This is software that is installed on your computer (desktop or laptop). There is usually a one-time fee you pay for each computer it is installed on, and you might need to pay for major upgrades later too. It is a great option if you’re a traditionalist who enjoys having all your data stored locally. However, it does require reliable IT infrastructure, which can be costly to maintain.
- Cloud-based accounting software: This is software that is hosted in the cloud by the software provider. Instead of a once-off fee, you pay a monthly or annual fee for each user. It is easier to add and remove users, since no software is installed on any of your computers. Many times, you can also pay only for the modules or features you need. Being cloud-based, you can access it from anywhere, and any computer, as long as you have internet access.
- Industry-specific accounting software: Some industries, such as retail and hospitality, use software specifically designed for the industry. It usually includes a point-of-sale feature, while other features can be tailored to your specific business needs.
- Enterprise resource planning (ERP) software: More comprehensive than standard accounting software, ERP software typically combines accounting features with inventory management and customer relationship management (CRM) into a single package. It can be especially useful for business-to-business (B2B) enterprises, making it easier for all financial data to be up-to-date and accessible from a single platform.
Key Factors To Consider When Choosing Accounting Software
Once you know which type of accounting software you prefer for your business you can start considering the variables that will help narrow your choices.
- Functionality: One of the most important considerations is for the software to have all the features you need. Here it can be useful to first draw up a list of must-have features, which might include payroll, invoicing, inventory tracking, and more. Including too many features you don’t need can make the software more complex, and also more costly per licence or user.
- Scalability: Successful businesses continue to grow, so you need accounting software that can grow with your business. Whether that means being able to add more users, handle more transactions, or add new features you did not previously need.
- Usability: Any new software is going to require a little bit of time to implement and to train your employees on. That said, you still want to focus on software that is user-friendly and easy to learn. And it is easier to evaluate this if you’re able to schedule an interactive demo of the software before making a decision.
- Integration: Even ERP software would need to integrate with some of your existing systems, and you want integration to be simple and fast.
Customer support and training: Regardless of whether you opt for desktop or cloud-based software, you want to know that the support and training resources you have access to are adequate. When you encounter issues, you want them to be resolved speedily.
With any luck, once you have decided on the type of accounting software you want, and considered other factors, you’ll be left with only two or three to choose between. Which will be much less overwhelming than dozens of options. And a lot less time consuming to evaluate further with full product demonstrations. Tencia from Arrow is a flexible and scalable ERP platform designed for small to medium sized businesses. And it is available as both cloud-based software and as an on-premises solution. Learn more about all Tencia’s features or register for an obligation-free online demo.