So you have decided to automate your accounting and bookkeeping. Kudos for prioritizing efficiency and for planning to invest in automation. Automation can help you save time, money and focus your energy on your core business tasks. There are a lot of players in the market. The issue of plenty can often cause confusion and tempt you to pick what's free and cheap.
Here are a few tricks to pick the apt accounting software for your startup or small business.
Scan your business functions
Different accounting software providers specialize in different features. To see which one fits your startup the best, make a list of essential functions. If you already have an accountant, you can also consult them, or else talk to your team. Take some time to understand your business, because once you pick a software it's costly to switch to a different provider
Some of the common functions provided by different accounting software are
-Inventory management
-Sales tracking
-Payroll
-Customer CRM
-Budgeting
-Estimates
Some may specialize in a certain industry. We'll discuss industry-specific softwares in another blog.
The right fit
Every business is different. Still, here are a few common questions that each startup can ask to pretty much reach a conclusion.
-Is it online or does it need installation?
-Can it grow with my business? (Most softwares have scalable pricing based on set parameters such as number of invoices, number of users, etc)
-Does it allow multiple people to use it?
-Can you afford it?
-Is it easy to understand? (If you are doing accounting in-house then this is a crucial question)
What level of support is available
Do factor in the support costs depending upon your level of accounting experience. If you're starting out or don't have an accountant, you will need a lot more guidance. Dedicated support via email, live chat, or phone call is better than being directed to an FAQ page or a public forum where you have to scroll through tons of queries to find what may be relevant to you. Ideally, a good software provider shouldn't be charging you an extra fee for support services.
Pay only for what you need
Most providers sell their services in bundles. Within a pricing scale, there will be set services provided. Don't be tempted to buy costlier packages, thinking "we may use that". Be highly specific and buy what you will be using in the present. You can always add new features as and when your need truly increases.
Ask yourself these questions
If you're doing this in-house then see how much time you will be spending on working with the software. Some important questions to ask before buying are-
-Can you outsource the whole accounting function?
-Will it be cheaper to outsource vs hiring a full-time accountant?
-What are the legal and accepted accounting practices?
-Are you comfortable handling this without professional help?
Merely buying accounting software won't solve your accounting function. Remember, that you still need to know how to work with it. You need to have good knowledge of all the nuances of that software. Depending upon how much your startup can afford, you can make these decisions.
Is there a more effective way?
Yes! There is. Cognate works with startups and SMBs to help them streamline their finance. If this sounds like something you'd be interested in, then hop on a call today.
Until then
Happy Business
