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Xero vs QuickBooks: The Accountant’s Review –

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Which accounting software is better, Xero or QuickBooks Online?

Both Xero and QuickBooks have received positive reviews from customers—Xero and QuickBooks Online have largely the same ratings—and both offer similar accounting tools. Choosing which accounting software is best for you and your business really depends on your needs.

Let’s weigh in on both Xero and QuickBooks Online so you can decide which best suits your business needs.

General features

Here are the similarities between Xero and QuickBooks Online:

  • Monthly subscription model
    Both Xero and QuickBooks Online cost a monthly subscription.
  • Provides a free mobile app
    Each of these accounting products provides a free mobile app where users can use features like invoicing, accepting payments, signatures, viewing bank account balances, bank reconciliation, etc.
  • Cloud (access your data anywhere via Internet/Wi-Fi)
    Both Xero and QuickBooks Online are cloud-based, meaning the software runs online, not locally on your computer. So as long as you have Wi-Fi or Internet, you can access your data.

Who should use Xero?

Medium and large enterprises with multiple users.

Who Should Use QuickBooks Online?

Small business owners, freelancers, and businesses who outsource their accounting tasks to a bookkeeper or accountant.

Prices (subject to change)

Xero plans and pricing

  • Early bird: $12 per month
  • Growing: $34 per month
  • Installed: $65 per month

QuickBooks Online Plans and Pricing

  • Easy start: $25 per month
  • Basic: $50 per month
  • Plus: $80 per month
  • Advanced: $180 per month

Perks of Xero and QBO

Xero Pros

  • Supports unlimited users
    One of the biggest appeals is that Xero supports unlimited users across all their plans. This is in contrast to QuickBooks Online, which limits the maximum number of users to 25. If you plan to have a highly involved team, the unlimited user feature that Xero offers may affect you.
  • All plans include basic inventory management
    With Xero, you won’t need to pay extra for inventory management. With QuickBooks, you need to have the Plus or Advanced plan to track inventory.
  • Automated collection of invoices and receipts through Hubdoc
    Hubdoc can make it easy to transfer your invoices and receipts to Xero for the relevant banking transactions.

QuickBooks Pros

  • Easy to learn/most familiar
    QuickBooks is easy to learn for beginners to certified public accountants. QuickBooks is one of the most popular accounting software solutions out there, so your bookkeeper and accountant have probably used it before. Even business owners new to bookkeeping find the QuickBooks dashboard easy to master.
  • All plans support unlimited invoices.
    QuickBooks allows you to create unlimited invoices in all of their plans. Xero does not offer unlimited invoices. The Xero Early plan offers up to 20 invoices per month, increasing the limit of 1,000 invoices they offer with the Established plan. If you are a business with a lot of sales, you may want to consider QuickBooks Online.
  • Live customer support
    Unlike Xero, which only offers online support, QuickBooks Online offers phone support Monday through Friday from 6 a.m. to 6 p.m. and Saturdays from 6 a.m. to 3 p.m.
    Advanced plan members receive 24/7 customer support.

Cons of Xero and QBO

Cons of Xero

  • No live phone support
    Unlike QuickBooks, Xero does not offer phone support for its customers. That way, if you have any technical problems or questions, you won’t be able to contact the support team to help you solve the problem.
  • Learning curve
    Most people prefer QuickBooks Online, and most accountants prefer it as well. Xero accounting software seems to be more common for Canadian companies in my experience. This doesn’t surprise me given that Xero is not an American company like Intuit (QBO’s parent company).

Cons of QuickBooks

  • More expensive than Xero
    The cheapest plan starts at $25 per month and goes up to an advanced plan of $180 per month.
  • You need to subscribe to higher level plans to get support for more users
    QuickBooks Online offers a limited number of users, and the Advanced plan allows for up to 25.
  • Some additional features are only available in more expensive plans
    Features like inventory management and accounts payable are only available on higher-tier plans.

Conclusion: QuickBooks wins

In this comparison of Xero and QuickBooks Online, we give QuickBooks the win.

Why QuickBooks Wins:

Its ease of scalability

You can always upgrade your QuickBooks Online plans. That way, as your business grows and your needs change, you can change plans and improve your tools.

Your accountant has probably worked with QuickBooks Online

​​​​​​While there are several accountants who are proficient in both Xero and QuickBooks Online, finding the right accountant with Xero experience is less common. Xero currently has over 100,000 accountants and bookkeepers using its platform. However, QuickBooks has market share. It is now 62.2%! This means that more than 6 out of 10 accountants or bookkeepers you speak to will likely only use QBO over Xero.

Live support

No software is foolproof. Sooner or later you will run into problems. You will need to talk to someone to get the help you need and to be sure that the problem is solved.

Conclusion

Both Xero and QuickBooks Online are excellent accounting software solutions and offer excellent accounting tools for businesses. Both continue to grow and improve their products, but QuickBooks Online is currently 9 times larger than Xero.

NOTE: This blog represents the opinion of the author and does not necessarily reflect the views of Big Ideas for Small Business, Inc.

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