Tips for Choosing Accounting Software for Small Businesses

When I started my research and investor relations firm several years ago, I handled accounting myself using Excel spreadsheets. While that worked fine when my business was a small sole proprietorship, when I incorporated, I found that I needed a more sophisticated accounting system.

My accountant suggested that I switch to an off-the-shelf business accounting software package, which has turned out to be an excellent solution for my small business. If you are starting a small business and trying to make a decision about how to manage its financial accounting and reporting, here are some tips on choosing accounting software for small businesses.
 
Talk to Your Accountant

Your accountant is an ideal person to advise you on whether accounting software makes sense for your business. She has probably worked with many other small businesses and, therefore, has a good idea of what has worked for firms of various sizes, complexity, and maturity.

Be Sure Training Is Available

Although I have found that using business accounting software is relatively easy, it is not always intuitive. Therefore, having a good tutorial session before getting started could, based on my experience, save you a lot of time and aggravation. Your accountant may be able to provide this service. If not, your software provider should be able to connect you with a certified instructor in your area.
 
Choose Business Accounting Software With Strong Aftermarket Support

Fortunately, since completing my initial training on how to use my accounting software, I have needed relatively little support. However, the few times I did, it was essential to me to be able to get quick, accurate help. One way to determine the quality of a product's aftermarket support is to get feedback from others who have used it for an extended period of time.
 
Think About Your Goals for Accounting Software

If your business is relatively simple, a streamlined, easy-to-use product without a lot of bells and whistles may make the most sense, since there is no reason to pay for features you won't use. On the other hand, if your business has inventory, numerous customers, multiple employees, and dozens of vendors, you will need a more feature-rich software package that can easily handle these more complex transactions.
 
Consider Industry-Specific Software
 
There is industry-specific accounting software that is appropriate for some businesses. This is another area where your accountant probably can help out by advising you as to whether a product specifically tailored for your type of business is necessary.
 
When Making a Choice, Plan Ahead
 
When choosing accounting software, think about how your business may change in the future. Will you be adding employees, introducing new product lines, or expanding into other states? If so, you may want to take those anticipated changes into account when choosing accounting software. In particular, find out what options are available to easily add to or expand the features and capabilities of your software as your business grows and changes.
 
Don't Expect Business Accounting Software to Replace Your Accountant

Accounting software is not a replacement for a good accountant, but it can make your visits with your accountant more painless by allowing you to quickly provide accurate and detailed financial information about your business.
 
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