According to the Close Brothers Business Barometer, late payments are an issue that affects 67% of small-to-medium sized businesses in Ireland, with over half of SMEs being forced to let employees goes as a direct result of late payments. Cash flow management is critical to the success of any business, but while larger corporations may be able to juggle a bit more, late payments can be absolutely crippling for smaller businesses or self-employed people. With that in mind, here are 8 great resources for managing your billing and invoicing.
With over 5 million users worldwide, Freshbooks is the biggest accounting solutions software on the market. First founded back in 2003, Freshbooks was an early entrant to the online accounting market, meaning it has been developing and perfecting its software longer than any of its competitors.
But the main reason for Freshbooks’ mass appeal is most likely due to its interface, and the ease with which it can be used. Freshbooks presents complex financial tasks in a minimalistic, step-by-step manner, so that even people with no experience in billing or invoicing can do the job.
Freshbooks accepts many forms of online payment, such as PayPal, Apple Pay, Google Checkout, Stripe, and major credit cards, consolidating them all in one place. However, there are limits to how many customers can be invoiced per month, which depends on the pricing plan you choose, so this may not be the best option for businesses with high levels of first-time customers.
QuickBooks was developed by the financial software firm Intuit, which has been working in this field since 1983, around the time computers really started to go mainstream. Despite the head start it had over FreshBooks, the launch of their first product did not go well, allowing Freshbooks to move in and take a larger share of the market.
Since then, QuickBooks has ironed out these issues, and now has over 2 million users, making it one of the leading solutions on the market. The most notable distinction between QuickBooks and FreshBooks is volume, with Freshbooks limiting the number of invoices that can be sent by pricing plan, while QuickBooks allows any number on any plan, despite being the cheaper option. If you deal with a small number of regular customers, FreshBooks may be the best choice, while QuickBooks is better suited to tracking a high number of accounts.
While both FreshBooks and QuickBooks focus more on the most fundamental aspects of accounting, Xero is a product that aims to take people to the next level of detail. In addition to calculating, tracking, and accepting payments, Xero enables users to quickly create all sorts of financial status reports, such as debt to equity ratios, current liabilities to net worth, owner’s equity statements, and much more.
Xero has recently increased its pricing, making it one of the slightly more expensive options. It is probably not suited for very small businesses, freelancers, or self-employed people, and it will take a bit of getting used to before you can use it to its full potential, but if you are looking to get more data on your business without getting a new degree, Xero can help bridge the gap between amateur and professional accounting.
Zoho was developed specifically to meet the needs of new and growing businesses, with its main focus being on flexibility and ease of use. Even their most basic package contains some of the most important features for a fledgling business, such as custom invoices, recurring transactions, and bank reconciliation. Zoho makes it easy to track multiple projects or expenses at once, allowing you to automate certain tasks or seek approval for others. There is also a long list of plugins to help you personalise the customer experience, such as plugins to track deliveries, help you manage your email, or a chatbot to help with customer enquiries, making this a superbly affordable choice for people who are just starting out and may not have a lot of experience.
Founded in 2010, Wave is a much newer entrant to the market than those we have looked at already, but that hasn’t stopped it from becoming a major player. Wave has a very simple online dashboard that essentially boils down to a few clicks and some typing, but allows you to create professional level invoices and graphs. Perhaps the biggest appeal of Wave is that it is completely free to use, with no limitations. The company makes its money by charging 1.4% + €0.25 on all European card payments, or 2.9% + €0.25 on all non-European cards. While this arrangement may not be suitable in the long run, it enables new business owners to get the support they need, without investing any resources beforehand.
Dating as far back as 1981, Sage is one of the oldest accounting software firms in the world. In the nearly three-decades since, they have built one of the most flexible and secure forms of accounting software available on the market, offering all the features you would expect, from the basics such as automated invoicing and cash flow management, to the more complex issues such as tax filings or fraud. Although Sage does have various products in different price ranges, they are most popular among large corporations that deal with a high volume of customers. Unless you clearly intend to use particular features of this product, or plan to upgrade your subscription in the future as your business grows, there are not many reasons for a new business owner to use Sage rather than some of the alternatives listed, many of which offer similar features with less complexity at a lower cost.
Zipbooks is another relatively new entrant to the finance software scene, and like many of the newer companies, it gives customers the chance to avail of its most basic features for free. Invoicing, payments, financial status reviews, and bank reconciliations are all available for free on their starter pack, with a 2.9% fee attached to all card payments. There are not as many bells and whistles in the free starter pack as you might find in the likes of a well-established brand like Sage, nor is there the same level of third-party plugin support as there is for Zoho, but there are three tiers of paid plans, allowing you to unlock any extra features you may need as your business grows.
Most of the options listed above focus on startups or small businesses, but soe operations are even smaller than those. These days, many people make money from a hobby, or run various small online businesses. For situations like these, software such as Invoicely can help people manage a small volume of transactions, even under multiple brands, for free. All of the more advanced features such as project management, delivery tracking, or multiple users are available through their paid subscriptions, making this an ideal choice for people who want to see if they can turn their pet project into a viable business.
As you can see, many of the features offered by these products are more or less the same, regardless of which software you choose. But with different levels of detail, support, prices, and customisation, these products are far from identical. For some businesses, features such as delivery tracking or dealing in multiple currencies are crucial, while for others they are completely redundant. To determine which software is best for you, you need to look ahead and see which direction you hope to move in. While you can always switch at any time, getting it right the first time will make it much easier for you to learn what you need, and successfully manage your business in the long run.