Believe it or not, your company is about to be part of an enormous wave of change in the next few years.
That’s because, if you’re like most small and medium sized businesses (“SMBs”), you’re likely using an on-premise accounting application and most likely that on-premise solution is QuickBooks. QuickBooks is by far the most popular accounting application for SMBs and deservedly so – it’s full featured, easy to use and well supported by Intuit. Starting in the last quarter of 2013 we began recommending other products as well. Why? Because as good as QuickBooks is, I believe that many of my clients are going to dump it starting this year and over the next few years because the cloud has caught up to the accounting world and there are many really good competitors to QuickBooks standing by to pounce.
Because of all of the advantages of working in the cloud it is obvious that within the next few years just about all SMBs will be using a cloud-based applications. I’ve watched the enormous growth of software for customer relationship management, human resources and payroll. I’ve noticed the faster performance. I’ve witnessed their ease of access from tablets and mini-laptops and even smartphones. I’ve watched companies move more and more of their in-house systems to hosted ones, eliminating their servers and IT infrastructure. I’ve seen my own clients, small business owners who look at any new relationship or technology with a wary eye, grow more comfortable letting other companies handle their data on managed servers over the past few years. Although no one’s infallible, the security that they provide is much better than our own.
It’s also a perfect environment for software developers too. Microsoft and Google are leading the way by putting their resources into cloud-based products. It is a lot easier to purchase and use Office 365 than it is to even find it in a store. Google introduced it’s Chrome Books which are totally internet based. Salesforce.com has been saying for years: the cloud is the future for them. It’s a more profitable and more productive business model for a software company to distribute their products.
Which brings me back to QuickBooks. In the next few years it’s inevitable that you’re going to replace your on-premise QuickBooks system for something cloud-based. You won’t have much of a choice. And you’re going to take that opportunity to look around. And you’re going to discover there are some interesting alternatives.
There’s Xero, which just raised $150 million in October. And Intacct, which has received multiple rounds of financing over the past few years. There’s FreshBooks. There’s NetSuite and of course there’s QuickBooks Online. There are others but these, in my opinion, are the big players right now in the cloud accounting/ERP market.
To oversimplify, Xero, FreshBooks and QuickBooks Online are arguably geared to the basic bookkeeping/invoicing/bill-paying customer – the SMBs. Intacct and NetSuite are targeting the next level – those companies that employ controllers or CFOs, are growing, have multiple users and need advanced tools like sales order processing, purchase order, inventory and warehouse management, workflows, automation and more complex reporting for cash flow and consolidations.
These applications have been built from the ground up and support a better, more flexible web-based architecture. Migration tools to move away from QuickBooks are available. Deals have been struck to integrate these products with other popular online services and collaboration tools like Dropbox, Zoho, PayPal and Bill.com.
I have been working a lot with Xero that turns the accounting world upside down. this program is designed for business owners. It is a simple interface and does a lot to automate the accounting for your business and reduce the time your staff is taking to get this done. It also is designed to automatically integrated with hundreds of third party applications. For the first time in a very long time, Quick Books is playing catch up with many of the innovations that Xero has brought to the market.
So what will happen? Many current QuickBooks customers who are frustrated with the software’s older architecture and many problems with getting accurate timely information have suffered with it because they/you did not feel the need (or were just too lazy) to change will now be forced to change in the next few years. They will be looking at other alternatives. and for the first time in a long time, there are many great other options to consider.
Be prepared – :maybe this year, but certainly during the next few years you will be part of this enormous trend. That’s a certainty. Will you be one of the many who decide to dump QuickBooks?
Adopted from 1/6/14 Forbes author Gene Marks