Some facts about Quickbooks
Quickbooks is a wildly popular financial management software. In 2015 they had 80% of the market share with 29 million small businesses in the US, and QuickBooks is still growing strong.
They have currently over 2.2 million subscribers for QuickBooks online, a very big number of which is Self-Employed users. Those users are a very strong focus of Quickbooks in their overall strategy, but specifically for Singapore. Recently Intuit launched QuickBooks Self-Employed, a way for the Singaporean self-employed community to stay on top of business expenses. There also is a mobile app aims to ease accounting tasks for the Singapore Self-Employed users.
So Quickbooks is by all measures a really fantastic product for Self-Employed Users, Freelancers, and Small-Business Owners. However, once your company grows beyond 10 or 20 employees, you will very quickly outgrow Quickbooks and you will need to look for an alternative solution that better accommodates a growing small-to-midsized organization.
How do you know that Quickbooks may no longer be able to cater for your growing company?
Should you upgrade from QuickBooks?
The truth is that change is difficult. If things (more or less) work, then people are very resistant to change. Pure accounting software provides you with significantly more flexibility to adjust business processes on the fly – and this is a double-sided sword. If a process can change depending on your customer, your internal staff, the whims and fancy of your people, then there is no consistency. This prohibits profitable growth and clear transparency on the business. The more a company grows, the more excel spreadsheets you will need to keep a tab on all the activities and to create the reports you need to run the company.
And people like their spreadsheets! Spreadsheets are wonderful: you can add in or remove any number, you don’t need to worry about trace-ability, everybody can keep their own precious spreadsheet, and manipulate it to their heart’s content. So asking people to give up their spreadsheet is akin to asking Gollum to give up his ring… But “what got you here won’t get you there”. As your company grows, so will the tools needed to keep the business running smoothly and transparent.
How do you know whether your company has grown to a stage that you may want to consider upgrading from Quickbooks to an ERP system?
Here are some of the signs to look out for:
1. The number of spreadsheets used in your organization starts to grow (like, really grow). When people start to protect their precious spreadsheets like their (corporate) life depends on it, you know it’s time for a change.
2. Answers for (supposedly) simple questions (such as: “How much widgets are we expected to ship next month?” “What is my expected cash-flow for the next 3 months?” suddenly take much longer like they used to.
3. It seems to take forever to close the books and provide accurate balance sheets and profit and loss reports. (Because account reconciliation for month-end closing is difficult).
4. You expanded your business into another country, maybe even operate under different time zones. Your team will not be able to access real-time data and thus continue to rely on guess-work instead of up-to-date information.
5. Your managers make the wrong decisions because they don’t have accurate, real-time data available.
6. You want automation and integration of your accounting software with other systems. Unfortunately, there are limitations to the ability of Quickbooks to integrate with 3rd party software. So if you have an inventory tracking system, a separate CRM system, and some spreadsheets to manage information, you will need to manually consolidate all this information – and you may not want to do that.
7. You want to do business online, and integrate your front-end shop orders directly with your back-end accounting software. That will be difficult with Quickbooks, and you will need other software to manage sales orders, deliveries and inventory that integrates with your online shopping cart or e-commerce software.
8. You need to be GAAP compliant, which requires you to have audit trails on all financial transactions. Quickbooks allows you to change anything without an audit trail – this could become a problem down the road.
9. The system becomes painfully slow due to the number of transactions and the amount of data entered. (Sorry, but Quickbooks is just not that scalable).
10. You want interactive reporting. You need real-time dashboards on information across your organizations. You really would like to see your main KPIs on a real-time basis, ideally on your mobile device.
11. You want to keep track of customers much earlier in the sales cycle. You need functionality to track prospects, follow-up on opportunities, manage quotations and sales orders, and you want to be able to see the complete customer history for the people you do business with – and you really don’t want to build another spreadsheet (or many).
12. Your accounting team threatens with resignations, as they have to work overtime during every month-end closure. Or – to counter this – you realize you now have more accountants than salespeople just to keep track of the books.
Ok – I think I made my point. Quickbooks is really great software for Freelancers, Self-Employed users, and small business owners. It is inexpensive, flexible and can do the job while your business is small.
But once your business has grown and you have more than one person running your accounts, once you have inventory, delivery, and CRM integration needs, you really should consider an ERP solution that scales with your company. After all, you spend a lot of effort to grow your company to the size that it is now, and you wouldn’t want your IT environment to hold you back from further growth.
Also, you may want to give your accounting team a break. In many cases – with separate systems for accounting, sales and inventory – month-end closing becomes a real pain for your team. They spend countless hours trying to reconcile the figures. They work overtime to produce the reports, neglect their families and sacrifice their free time to be able to provide you with the information you need to run your business.
We have helped many companies to migrate from Quickbooks to SAP Business One for exactly those reasons. To find out more about SAP Business One and how it can help your organization to increase productivity please get in touch.