Xero is one of the most popular accounting solutions on the market.
Founded in New Zealand in 2006, Xero is a cloud-based small business accounting software catering specifically to freelancers and small businesses worldwide. And they have clearly found a system that works – today, they can boast of more than 1.58 million global customers.
Will it be the best accounting software for your business? Let’s find out in this quick Xero review.
Setting up Xero Accounting
Xero is an accounting system that’s incredibly easy to use and navigate – even for those of us who don’t consider ourselves too tech-savvy.
Once you set it up, the software will initiate the start of several tasks that will make you well acquainted with its different features and capabilities – such as adding your first customers, creating new invoices and connecting to your business bank account. These tasks are all relatively straightforward to complete – after all, Xero is targeting small businesses which often have few internal IT resources to rely on. For those who still need a helping hand, Xero offers plenty of detailed how-to videos and guides to get you started. They also have a thorough FAQ page for new users.
Most of the features are easy to access. The various programs and features can be found either in the dropdown menu or from the main dashboard. In the interactive dashboard, you can also create shortcuts for tasks, such as creating new invoices, viewing the number of bills and invoices due, and the current bank account balance.
Simplified Business Transactions
Xero aims to be as user friendly as possible, and this is highly visible throughout the entire system. As an example, you can easily access and edit all of your purchase files with a few clicks of a button, and the software also offers ready-made templates for those who would rather avoid drafting up individual ones for each client.
The accounting system also comes with transaction features allowing for multi-approval and two-factor authentication. Used correctly, these can help you mitigate the risk of financial fraud.
In August 2019, news broke that Xero would now let you sync with your Revolut business account, too. This was well-received by small entrepreneurs everywhere.
Xero’s Top Accounting Features
In addition to being user-friendly, Xero can help you streamline your workflow, save you time, and increase visibility into your financial processes – all so that you can be on top of your accounting tasks faster.
Here are some of Xero’s top accounting features:
- You can send real-time financial information to HMRC
- The software includes auto-enrolment
- You can pay your employees at different rates, depending on various forms of compensation. You can also reimburse business expenses and track employee benefits
- You can email invoices directly to Xero. The system also offers seamless integration with Stripe, Square and PayPal, so that you can accept online payments
- Easily convert quotes to actual invoices
- Worried about not getting paid? Send out automatic payment reminders (either right before an invoice is due or immediately after) to encourage your customers to always pay on time
- Xero comes with inventory tracking and purchase order functionality
- With the Xero Accounting and Invoices mobile app, you can take care of all your financial and accounting tasks while you’re on the road. View your cash flow and access customer contacts via the iPhone application, and check your account balance easily via the iWatch app.
- Finally, Xero can run more than 50 unique reports, including general ledger, profit and loss, and receivables. These reports can then be exported as either PDF, Google Sheets or Excel documents.
XERO Pricing Plans
Xero is accounting software that can bring plenty of good value to its customers. One of its clear advantages is that nearly all of its plans include its key accounting features. I’m sure we all know how annoying it is to find perfect and affordable software – only to discover that the features you fell in love with are only available through an expensive premium upgrade.
In addition to this, you will find that each of Xero’s plans offers an unlimited number of users. Many other accounting systems base their pricing on the number of users you add, this means that your software can suddenly become unexpectedly expensive if your company goes through a quick growth period.
Here is a quick overview of the current Xero pricing plans:
The Early Plan: This package starts at $9 per month, and it’s the perfect option for small businesses that are trying out their first-ever accounting solution. With the Early Plan, you can send a total of five invoices, and five bills and perform 20 bank transactions per month.
The Growing Plan: This is the best accounting option for small businesses that are currently experiencing business growth and want to accelerate it further. This plan costs $30 per month, and it comes with an unlimited amount of invoices, bills and transactions.
The Established Plan: This premium version will set you back $60 per month. In addition to providing you with an unlimited amount of invoices and transactions, this is the only Xero plan that offers expenses and multiple currencies.
Does Xero sound great on paper, but you’re not fully convinced that it’s the best accounting system for you yet? Well, that shouldn’t be a problem – Xero now offers a 30-day free trial, meaning that you can take your time and test it out properly before signing your contract.
Popular Alternatives to Xero
Xero is a solid and popular accounting solution, and it comes with plenty of good reviews. However, not every solution is absolutely right for everyone.
A big drawback for many users is that Xero no longer includes payroll services. However, they do offer seamless integration with Gusto (starting at $39 per month) as an alternative. If payroll is a necessary feature for your business, you are likely to find a much cheaper software with payroll integration somewhere else.
Some of the obvious drawbacks of Xero include the lack of payroll, but there have also been registered a few complaints of Xero customer service being hard to reach.
The top alternatives to Xero in 2019 are: