What to Look For in Small Business Accounting Software

Listen in! Pick up some expert advice to a reader's question that we selected from CyberSchmooz.

You’re getting your startup together but there’s one crucial area you’ve been avoiding getting all the way together, and that’s bookkeeping software. There’s no way around it. This, you must have. But you don’t quite know what to look for in small business accounting software.

No worries. Here are some suggestions.

The Issue

Whither the days of paper bookkeeping? The fact is the practice of keeping books by hand, using a physical ledger or similar, is by now quaint, the stuff of old movies and men in sleeve garters and visors, pouring over “books” in dim lighting.

So, you do need software. There is a lot of it out there, both free and at cost, to help you remain abreast of your finances.

Choosing the Right Software for You

When it comes to accounting software, you’ve got tons of options. But that’s not all gravy, since you’re really confused now. If you buy something with uber-edgy capability, you may be wasting money if you don’t use it. Right? But you’re also afraid that if you invest in something that is pretty much basic but does have more utility, your system may ultimately underperform and be in need of an upgrade sooner than anticipated.

Now, if you were a large company, it would be no problem to buy a bespoke system – customized according to your needs. But that’s not you – yet. Don’t fret, though, because beyond fundamental capabilities, most accounting software for small business these days have grown into bona fide suites. Here are some common features:

General ledgers: a practical and easy way to keep track of what’s coming in and going out. Most software will also offer extensions such as check handling, tax documenting and payments.
Double-entry bookkeeping: with this, you can automatically monitor money sources as well as where cash is spent.
Point of sale capability: you use POS to handle sales, be they check payments or electronic.
Customer Relation Management: this is customer assistance, which usually includes a way to interact with customer support reps and information technology people who can handle customer accounts or payments.
Enterprise Resource Planning: essentially a suite, this is a bunch of instruments that you can use for a range of needs including manufacturing and warehouse management, human resources, and financial planning. The best thing about ERP is that it links pretty much your entire biz.
Inventory management: Integrate this with POS capability to track inventory through sales and scanned bar codes.
Software as a Service: Did you know that some business software is available exclusively online? Now you do. Cloud computing allows you to keep all your info in one spot.

Paid or Open-Source?

Your accounting software options include both free and paid. Which is best? It depends on your needs, With the paid kind, you get updates and accountability. The plus side of free, open-source programs includes more helpful user communities and a better array of available add-ons and extensions.

The Best Software

While this list is subjective, it’s what Yahoo deems as the best accounting software options. Keep in mind that you won’t necessarily need one of these top options to meet your accounting needs: Peachtree, Xtuple Postbooks, Bookkeeper, Intuit Quickbooks, SQL-Ledger, GNU Cash, Nola Pro and Microsoft Excel.

Now that you know what to look for in small business accounting software, you can get going in confidence. After all, haven’t you put this off long enough? Get it in place and move toward business success.

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