Ask anyone who started their career in public accounting, and they probably don’t have a strong impression of QuickBooks. However, ask any business owner, and you get a different answer. Luckily, I have experience with QuickBooks from both the service provider and business owner perspective. This article will help you determine if you should be looking for QuickBooks alternatives.
As a CPA who has worked with clients with all levels of accounting software, I can tell you that QuickBooks will more than get the job done for most small and medium-sized business owners. However, when I ask prospective clients what software they are using, those with QuickBooks often almost answer with shame. That shouldn’t be the case…QuickBooks is the #1 accounting software in the world for a reason.
There is a lot of press about newer software solutions such as Xero, Freshbooks, and Wave. Still, as we sit here today, QuickBooks controls 80% of the accounting software market. Further, QuickBooks Online keeps building and adding tools to make it more robust.
I often get the question from business owners, “At how much revenue have I outgrown QuickBooks?” While it is a fair question, it is the wrong one. Revenue doesn’t typically determine when it is time to review QuickBooks alternatives. In fact, with more integrations than ever, a business can scale with QuickBooks like never before.
I have run my small business with QuickBooks for the past six years. My business is fully integrated using Intuit Payroll and integrating Square POS into the system. I run a small indoor kids’ play business along with my CPA firm, and I can safely say we won’t ever outgrow QuickBooks.
That doesn’t mean there aren’t signs that it is time to look for QuickBooks alternatives. Below I am going to give five different scenarios. In each, I will let you know if it is time to move on to an alternative or keep with QuickBooks.
Scenario #1 – I can’t get the reporting I need, time to look for a Quickbooks Alternative?
QuickBooks reporting is a common complaint. As a service provider with many clients using QuickBooks, I utilize their reporting with precisely zero of them. That is right. I don’t use QuickBooks reporting.
QuickBooks has taken many steps trying to improve its reporting. Still, it lacks providing anything more than rudimentary information.
As an outsourced CFO, reporting is critical to providing my clients’ insight, forecasting, and analysis. Yet, I would never switch one of my clients due to reporting. Why? Because there are many excellent add-ons that you can utilize to enhance QuickBooks reporting. There are add-ons for dashboards, forecasting, and basic reporting. Further, there are tools to help you directly import data into Microsoft Excel to do even more analysis.
Should I switch? No – look through the QuickBook App providers portal to find a solution.
Scenario #2 – You are using QuickBooks as an enterprise solution
QuickBooks claims that you can use its’ software as a full solution to manage your company. This is partially true. However, if you use QuickBooks to do more than manage required customer information, you will run into limitations.
There are two problems with Quickbooks CRM. First, it has limitations. It only consists of a screenshot view of the customer. The more significant issue is that this functionality has been attached to an already existing software.
If you are doing much more than accounting in QuickBooks and require one system, then it’s time to look for an alternative. If you are OK having disparate systems, then QuickBooks might still work. For instance, you could use SalesForce to manage your customer relationships while feeding the information into QuickBooks. However, if you want an integrated system, it’s time to move on.
Should I switch? Yes – if you want a fully integrated solution, you should be looking for QuickBooks Alternatives.
Scenario #3 – You have a complicated, growing manufacturing process
Many people assume if they have inventory, QuickBooks isn’t for them. That is a flawed assumption. Between QuickBooks Enterprise and some apps such as DEAR Inventory, QuickBooks can handle inventory just fine.
However, you may have an inventory process that needs functionality, just not supported by QuickBooks. For example, backorder and partial shipments can be difficult to track in QuickBooks, and inventory tracking usually maxes out at around 1 million items. You’ll need a system built for more advanced manufacturing or inventory functionality than basic QuickBooks.
Should I switch? Yes – the QuickBooks inventory system is basic. If you require more, then it is time to move on.
Scenario #4 – Will QuickBooks Alternatives offer more in-depth data analysis
QuickBooks is a very stringent software – what you see is what you get. You can add some custom fields and tags, but there isn’t much customization past that basic functionality.
There are also many issues with getting information out of QuickBooks. If you want to pull basic information and integrate it with other basic information, you will most likely spend a significant amount of time in Microsoft Excel.
A year ago, one of my clients asked me to load data from QuickBooks into Microsoft Power BI. After two days, I, unfortunately, had to tell him that it would be more work that it was worth getting the information he wanted.
Should I switch? If you are doing more than basic data mining or don’t want to spend time in Excel, yes, look for QuickBooks Alternatives.
Scenario #5 – QuickBooks is missing functionality related to sales, inventory, or another business process.
One thing QuickBooks figured out early is that it can’t be the best solution for everything. For instance, while it does offer a basic point of sale system, it’s not very robust. Sure it does the basics, but if you are looking for a system that tracks individual customer spending or automatically markets to your customers, QuickBook isn’t it.
However, this doesn’t mean it is time to move on. As mentioned, so many solutions integrate into QuickBooks. In the POS example, I integrate with Square. You’d be hard-pressed to find a better small business POS solution than Square.
The same can be said for other areas such as human resources, CRMs, and inventory. Before considering a change due to missing functionality, consider solutions that integrate with QuickBooks.
A Note on System Conversions
I have led a few different companies through system conversions. I can tell you from experience that they are expensive, frustrating, and time-consuming. That doesn’t mean that they aren’t the right thing to do.
There are many good reasons for a business to move to new software. There is a point where QuickBooks is not enough and alternatives should be reviewed. However, as a business owner, you must be willing to stomach the expense, time, and disruption it will cause to move to a new solution. You’ve been warned….
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About Krieger Analytics
Krieger Analytics specializes in outsourcing accounting services for small businesses, from bookkeeping to virtual CFO consultations. Our background in entrapuernship and finance means we know what running a business entails. We want to meet your accounting needs without burdening you with the costs of a full-time accounting staff. We understand your position as a small business owner, because we have experience running businesses ourselves.
Have questions about anything discussed in this article, or are interested in what valuable insights a CFO has for your business? Conversations are free, so don’t hesitate to reach out at [email protected]. Let us explain how our services could be the right fit for you.