One advantage that Xero has over QBO in the invoicing department is the ability to create contact groups, and then send one invoice to everyone in that group. On the other hand, QBO lets you automatically pull unbilled expenses onto your invoices, and Xero doesn’t offer that capability quite yet. QBO remains superior in claiming expenses, transaction tracking tags, customer service, mileage, and time tracking compared to Xero.
Its inventory management reports will show you how well different items are performing and which ones are the most profitable. And you can also easily add inventory Items to quotes, invoices and purchase orders to make billing easy. If you upgrade to at least the Essentials plan from QuickBooks, you can enter employee time by client or project and automatically the strategic audit committee add that time to invoices. For more robust scheduling and PTO management, you’ll need to purchase the separate QuickBooks Time product in addition to the accounting software. Xero also offers mobile receipt capture through its Xero Me mobile app (previously called the Xero Expenses app), though you’ll need to upgrade to the Established plan to claim expenses.
Includes project tracking tools in most expensive plan; limited transaction tracking tags; lacks industry-specific reports; users with multiple businesses must pay for separate subscriptions. If you’re in the market for accounting software, you might be feeling overwhelmed by all the options out there. While Xero and QuickBooks are wildly popular, they’re not the only options available. There are a number of alternative accounting software programs that can offer powerful features and a user-friendly interface. Xero is a better option for businesses that need to track project profitability. This is because Xero allows you to see how much each project is costing you in real time and compare that to your estimated profits.
- You can either use their free 30-day trial or take 50% your monthly subscription cost for the first 6 months.
- However, if you work with multiple vendors and customers and need more enhanced features, you should consider QuickBooks Online’s Plus tier.
- Xero is ideal for businesses that keep a team of bookkeepers or accountants in-house.
- We found the platform’s profitability tools to be highly user-friendly.
On the flip side, there are some complaints about limited income and expense tracking categories. If your business has varied operations, you might prefer QuickBooks, as it offers more flexibility in tracking financial activities. For instance, you can track income and expenses by classes and locations. A satisfied Xero user shared that the program is the most user-friendly https://intuit-payroll.org/ accounting software on the market. Xero can be easy to use after you become familiar with it, but we believe QuickBooks Online is generally more intuitive and easier to set up. We are driven by the Fit Small Business mission to provide you with the best answers to your small business questions—allowing you to choose the right accounting solution for your needs.
When Xero is best
These two are clear heavyweights in the industry, so it’s no surprise that they’ve got some of the best features in common like being cloud-based and offering cutting edge time tracking tools. Both QBO and Xero let you import customer or vendor lists to save you time if you’re switching accounting programs. QBO also lets you add sub-customers that are listed under a parent customer, if you have, for example, bills that you send to different departments of one particular company. Speaking of tracking, both Xero and QBO have a way to track things like multiple store locations, product lines, or sales channels. In Xero it’s called Tracking, and in QBO it’s called Class Tracking or Location Tracking. Both have a customizable chart of accounts, and journal entry capabilities, and both allow you to import a chart of accounts.
Particularly, QuickBooks Online is compatible with a huge selection of applications you already use. You don’t have to onboard new applications or tools and it’s all available from within a single suite. Last, but definitely not least, we’ll take a quick look at what actual members are saying. Customer reviews are a great way to see exactly what features are really impressive, as well as what needs work. In our research, we’ve gathered ratings and reviews from TrustRadius (TR) to give you an idea of how these two compare. But hopefully this has started to give you a good idea of which accounting software might be the best for your business.
The many benefits of QuickBooks Online: Why you should make the switch
For those on the go, Xero has a mobile app accounting tool for both iOS and Android devices, though the app does not give you access to all of the features found in the full version. You can import data such as customers into Xero, but you’ll have to download the CSV file template in Xero in order to import the data correctly. Xero’s invoice entry screen, seen above, is clean and uncluttered with easy look-up options available for most fields.
QuickBooks Online incorporates many new and advanced features like bookkeeping automation.
With GoCardless, customers can pay them by using an ACH debit (bank transfer). Users can choose other third-party add-on apps to integrate with Xero for payment processing. As with QuickBooks, you can use Xero to generate custom branded invoices, send client payment reminders, and view invoice payment status. Other shared features include recurring invoices, one-click client payments and mobile invoicing. We found all these features to be user-friendly in Xero, and we were happy that they are available to all users. However, Xero provides the unique ability to reimburse employee expenses, including mileage reimbursement.
But, do keep in mind there are plenty more reviews all over the internet concerning both, we just like how TR breaks the important things down and their reviews seem exceedingly authentic. We also noticed that Xero and QBO may, at times, use different methods of reporting. For example, when you generate a Statement of Cash flows in each program, you’ll notice that Xero uses the direct method, while QBO uses the indirect method. Again, this is a matter of preference, and it may not be a big deal to you either way. Its invoice page is more straightforward, featuring only the most relevant fields, such as invoice number, issue date, due date, and the client. Sign up to receive more well-researched small business articles and topics in your inbox, personalized for you.
It also offers Payroll, but this service is an additional fee starting at $45 to $125 per month. Both Xero and QuickBooks Online are optimized for small to mid-sized businesses, so large enterprises with more complex requirements may struggle to tick all of their boxes. Integrated tools, shortcuts, and add-ons improve the overall experience.
We researched both tools extensively to help you choose the right accounting software for your business. In this article, we compare their core features, pricing and pros and cons to help you decide which one is the right accounting software for your company. FreshBooks can be a good option for freelancers and contractors looking for an affordable, simple accounting software.
Both QuickBooks and Xero are excellent accounting systems for small businesses, and customer reviews reflect how well the software providers understand their audiences. Nothing matches the comprehensive opportunities available through QuickBooks Online. It can even help you with the organization and filling of your tax reports.
In evaluating pricing, we considered the billing cycle (monthly or annual) and number of users. While it’s not part of our case study, we evaluated Xero vs QuickBooks Online in terms of assisted bookkeeping. We consider this a draw since each program is designed for specific business needs. QuickBooks Online and Xero both have a large collection of integrated apps, which should be enough to cover your business automation needs. You can enter as much or as little information as you need, and simply add the rest when it’s necessary. An important though often overlooked component of any software product is how easy it is to use.
