Choosing the Right Accounting Software for Your Small Business

As your business grows, so does the need for accurate, organized, and accessible financial records. Whether you're just moving past the spreadsheet phase or looking to upgrade from your current system, choosing the right accounting software is a critical step in taking your business seriously.

There are plenty of options out there, and while variety is great, it can also make the decision feel overwhelming. To help you cut through the noise, we've rounded up the most popular platforms for small businesses and broken down how they compare--including why we recommend QuickBooks Online for entrepreneurs looking to streamline their operations and grow their business.

QuickBooks Online

Best for: Small business owners who want a full-featured, cloud-based solutions that integrates with everything.

QuickBooks Online is the industry leader for a reason. It's packed with features, offers excellent support, and integrates with just about every financial tool you might use. With robust reporting, invoicing, and automation capabilities, it's a great choice for growing businesses that want a reliable, professional system.

Pros:

• User-friendly dashboard and intuitive setup

• Robust invoicing, expense tracking, and reporting tools

• Seamless integration with banks, payment processors, and third-party apps

• Real-time collaboration with financial partners (like us!)

• Multiple pricing tiers for different needs

• Ability to add more functionality, like Payroll Processing and Bill Pay

Cons:

• Slight learning curve for advanced features

• Monthly subscription cost

Learn more about QuickBooks Online

Xero

Best for: Businesses needing strong international features and sleek design.

Xero is a strong contender, particularly for businesses with international operations or those that value design and usability. It offers solid accounting functionality and unlimited user access across all pricing tiers, making it appealing for collaborative teams.

Pros:

• Clean, modern interface

• Strong multi-currency support

• Unlimited users with every plan

• Excellent mobile app

Cons:

• Weaker inventory management compared to QuickBooks Online

• Less robust U.S.-specific support

• Limited payroll capabilities in the U.S.

Learn more about Xero

Wave

Best for: Solopreneurs and freelances on a tight budget.

Wave is a free, easy-to-use platform that covers the basics well for very small businesses. If you're a freelancer or side hustler looking for a no-cost way to manage finances, it's a solid starting point. However, it lacks the depth and scalability of other paid platforms.

Pros:

• Free accounting and invoicing tools

• Simple to use

• Decent reporting and bank syn features

Cons:

• Limited scalability

• Paid features (like payments and payroll) can add up

• Not ideal for growing businesses or multiple users

Learn more about Wave

FreshBooks

Best for: Service-based businesses that bill by the hour.

FreshBooks is tailored for service-based professionals who need reliable time tracking and invoicing. It's known for ease of use and excellent customer service, but may fall short for businesses with inventory needs or complex accounting requirements.

Pros:

• Great time tracking and invoicing tools

• Clean, user-friendly design

• Strong customer support

Cons:

• Limited features for inventory or complex reporting

• Pricing can get expensive as you grow

Learn more about FreshBooks

So, Which Should You Choose?

Every business is unique, and the right accounting software should match your goals, operations, and growth plans. But if you're looking for a well-rounded, scalable platform that's trusted by entrepreneurs and financial professionals alike, QuickBooks Online checks all the boxes.

It also makes working with Basswood a breeze. Our team of certified QuickBooks ProAdvisors are equipped to support QuickBooks Online with tailored bookkeeping, complete payroll processing, and convenient reporting to offer you a financial system that grows with your business.

Ready to get started with QuickBooks Online? Connect with us today for QuickBooks Online setup, optimization, and continued support. It's time to give your business the financial system it deserves.