For a business that is just starting up any product that makes things easier or more efficient is going to be helpful. Accounting software can take much of the burden out of record keeping, stock taking, managing cash flow and many other tasks that can drain a start-up’s limited resources.
But before you take the step of purchasing an accounting software package for your business consider these four tips to help you make the right choice.
#1. Make Sure you Actually Need Accounting Software
For sole traders and business of just a few people, a comprehensive software package is probably not necessary. Even if it does reduce workload the saving may not be enough to offset its price. Many simple accounting programs are available online either for free or at low cost and are designed for sole traders, the self employed and very small businesses.
If you have few overheads or your business primarily comes from just one or two clients, keeping track of accounts may be relatively straightforward. However if you plan or expect your business to grow over the short term it is better to have the appropriate accounts software already in place rather than trying to catch up with yourself as you are growing.
There will be enough on your plate with a growing company without having to worry about accounts.
#2. Consider What Features You Need Now and What You Expect to Need Over the Next Few Years
Accounting software can be a substantial investment, one you expect to use for several years before upgrading. So consider what features you might need going forward as well as what you need right now.
Naturally, these will vary depending on the nature of your business. Some common features of accounting software for small businesses that you might not need now but might need later include:
- Sales tracking
- Merchant account support
- Inventory management
#3. Modular or Specific
If your business is in a niche area you might find that not every accounting software package has the specific features you need . It is possible that there are sector specific software packages that will provide you with those features. Another option is to use modular software that has modules with sector specific capabilities that can be added on to the core software.
The advantage of modular software is that it can grow with your business, not just in size but in direction too. You may find yourself in a niche now but businesses can take surprising turns and you can find yourself moving into or incorporating very different areas. Niche software will support you only as long as you remain confined to that niche.
#4. Ask Around
Apply the rule of three and ask at least three other owners of businesses similar in size to yours what software they use, how they are finding it and what specific problems they found. Take note of the problems they came up against and look to see if different software packages address these issues.
When you have narrowed down your choices to three or four software packages ask the developers or distributors for contact info of businesses, again similar to yours, that have purchased their software. As before, ask how they find the software and if they have found any problems with it.
There are plenty of other factors to consider but as with any business decision you have to be efficient in how much time you spend weighing your options. Keep these four points in mind when selecting accounting software and you should easily make the right choice.
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