- 1 How Does Xero Compare to Quickbooks and MYOB?
How Does Xero Compare to Quickbooks and MYOB?
Inaccurate payroll and bookkeeping is a common issue that many businesses face. From initial employee hiring to day-to-day tasks such as accounting expenses or paying vendors, businesses are always looking for ways to save time by automating their processes.
Though some might think it’s expensive upfront, using the software could be one of your best investments yet!
With so many different accounting software options out there, it can be hard to know which one best suits you and your business.
So, in this article, we’ll break down the differences between three popular accounting software packages: Xero, Quickbooks and MYOB.
You’ll find out how each package works, what type of company they’re most suitable for and what features are available. So whether you’re a small or large business, this article should help narrow down your search for the perfect accounting solution!
Xero Accounting Software
Xero has gained significant traction in recent years, and, in my opinion, it’s by far the most user-friendly accounting software of the three.
Here are a few of the features that set Xero apart from the rest:
- Focus on education: the tool is only as good as the user, so Xero places significant focus on educating its users by providing informative and interesting online training tools and 24/7 online support.
- No jargon: Xero tries to remove most accounting jargon and instead uses simple terms so that business owners without an accounting background can easily understand and do bookkeeping by themselves. For example, instead of “debit” and “credit”, the software uses “spent” and “received”.
- Cloud-based software: Xero is cloud-based, so there’s no need to update the latest version constantly.
- Accessibility: anyone with the authorised login details can access the accounts anytime as long as they’re in a WiFi zone.
- Mobile app: for those who like having quick access on their phone, there’s a well-developed app that works on IOS and Android.
While Xero has some fantastic features, it’s also essential to weigh up the potential pitfalls of the program – so that you can make the best decision on software that can work for YOUR small business.
For example, Xero has weak inventory management software, and it cannot automatically calculate commissions. So, if you want to track your inventory and have multiple payroll structures, Xero might not be the best solution.
However, it’s worth considering that they have a list of software partners that integrate with Xero and solve that problem.
MYOB Business Software and Solutions
Unlike Xero, which was only launched in 2006, MYOB has been around since the early nineties. So, they’ve always been known as the king of traditional accounting software.
For example, MYOB has always been popular amongst sole traders and small businesses because it can help you do all the basic accounting tasks like lodging your BAS statement, tracking all your bills and GST, and issuing invoices straight from the software.
Here are a few benefits and downsides to the software that you should consider before signing up.
- Cloud-based software: although MYOB is known for their traditional way of accounting processes, they’ve also realised the importance of keeping up with the times and are now offering cloud-based accounting software.
- Single touch payroll: MYOB comes standard with single touch payroll, which you can use for one employee. However, an add-on feature allows you to organise your payroll for an unlimited number of employees (something Xero doesn’t offer).
- Inventory manager: MYOB helps you manage inventory and track jobs with ease. For example, you can track sales and stock across many locations and record purchases and sales in different currencies.
- Accessibility: similar to Xero, you can access accounting records anywhere, anytime.
- The AccountRight feature allows you to manage different business accounts with one username, which is perfect for running multiple businesses. Of course, MYOB will keep each business separate, but you can prepare business reports for each company without logging in and out of different software.
Downsides of the Software
The biggest problem that most people have with MYOB is that it is still operating as a desktop version. Unfortunately, this means that you’ll end up having to upgrade to newer versions of the software each time they’re released.
This can be quite a nuisance because all the users will have to make sure that they’ve all updated their software; otherwise, things could get messy.
But they’re new to the cloud technology game, so hopefully, we’ll see some improvement in this aspect.
QuickBooks has similar features to MYOB because it adopts a more traditional accounting approach.
But there are some differences – so here are a few of the beneficial features and potential disadvantages of the QuickBooks accounting software.
- Various product offerings: It has different product offerings for different-sized businesses. For example, SimpleStart would be for great small businesses, while their Online Plus is excellent for small to medium size businesses. They also offer QuickBooks Self-Employed for sole traders, which is fantastic for people and startups looking for a basic accounting tool.
- Numerous integration features: QuickBooks also offers the most integrations of all the accounting software out there. There are more than 650 integrations, with 25 of those being just payment processing options.
- Inventory management: QuickBooks enables you to input customer data and ordering information while maintaining your inventory data.
As with Xero and MYOB, QuickBooks also has a few downsides.
Unfortunately, the software is quite buggy. In other words, it often lags and even hangs if you’re asking it to do too many things. Slow software is usually the last thing anyone wants to deal with – especially if bookkeeping is not your cup of tea.
They also don’t have the most outstanding reputation when it comes to customer support – and with significantly LESS training tools, it makes it not very easy for business owners to navigate the software.
Price Comparison: Xero vs Quickbooks vs MYOB
Xero can range from $27 per month for the starter package to $67 for the premium package. And depending on the payroll features you want to add on, there’ll be additional costs. For example, you could end up paying up to $152 for the premium plan with payroll add-ons.
MYOB also starts at $27 per month for the starter and can cost you $60 for the premium software. If you prefer to go for the AccountRight software, the Plus plan is $109 per month, and the Premier version is $150 per month.
Quickbooks comes in at the lowest starter price at $22 per month for their Simple Start software and $52 per month for their premium package. Of course, you’ll have to add on $10 per month for payroll plus an extra $5 per employee if you’re looking for advanced payroll, but it’s the most cost-effective option out of the three.
Accounting software is a business owner’s best friend. It can help you manage your finances and keep an eye on the bottom line – but there are many options to choose from, each with its benefits and pitfalls.
We’ve outlined some of QuickBooks, Xero, and MYOB features to help guide you in making the best decision for your business. However, you’ll want to consider getting personalised advice from an accountant or advisor – especially if you’re going to run the software yourself.
Our team at Box Advisory Services is certified to offer training for Xero, MYOB and Quickbooks.
So if you need some help deciding which software to go with, how to set it up and how to manage it all, make sure to book a free consultation with us to assess your situation.