Even though Xero commands such a large market share all over the world, like every other software, it has its own strengths and limitations. To give you an insight into what it can offer to your business, here are the pros and cons of Xero.
‘The best at what it does’
Xero is a web-based accounting system designed for small and fast-growing businesses.
Described as ‘affordable professional-level accounting software for small businesses’ and ‘the best at what it does,’ it’s no surprise that the software has over 1,000,000 users and is the primary accounting solution for over 16,000 accounting firms.
According to your specific business needs, Xero can either save you heaps of time, energy, and money, or it can end up causing you more hassle than it’s worth. See the pros and cons below to make your own judgement.
Pros of using Xero
- Cloud-based so no downloads or installation required.
- Relatively easy to use and you’re connected with your own advisor.
- Cost-effective and offers a free 30-day trial so you can explore before you buy.
- Clean interface which gives you instant visibility of your financial position.
- Real-time bank feeds and bank reconciliation.
- Offers a capable estimating/quoting/order process that ties into AR invoices smoothly.
- Provides you with unlimited users.
- Built-in payroll with automatic superannuation payments
- Can manage personal expenses with mobile review and approval of each receipt.
- Easy access to the same files as your clients.
- Can be accessed from any device with an active Internet connection
- Easy integration with third-party apps and plugins.
- Constantly upgrading with better features which update automatically.
- Is very scalable so it will grow with your business.
- Saves you time and money.
Cons of using Xero
- Although easy to instal, it takes some time to learn how to use it.
- Recently increased its prices and no longer includes built-in payroll with its plans.
- The requisition/purchase/inventory side is very, very basic.
- Limited expense claims, projects, and multi-currency support to the most expensive plan.
- No built-in ‘Debtor Chasing’ function so businesses will need to manually follow up on unpaid invoices.
- Doesn’t support Exchange Trade Products (ETPs).
- Can be very slow if your company is running online or if it makes a high volume of sales through PayPal.
- Poor customer service (takes time and can be met with unhelpful advisors).
Always take into account the pros and cons of Xero before investing
It may be a professional double-entry accounting software at a very affordable price but consider all the pros and cons of Xero before investing in it. Choosing the right software for your business can drive it forward, so the decision should not be taken lightly.
To make sure that you choose the right one for you, always speak with your accountant and/or a Xero consultant to evaluate your suitability for the application first. Only when you do this can you invest with realistic expectations and get the best bang for your buck.