Choosing an accounting software package is a major decision, the results of which you’ll inevitably end up living with for many years, so it’s important to get it right. “Nobody ever got fired for buying IBM”, as the 1960’s maxim went, and more recently, the same could be said for those buying Sage accounting software for SMEs. But in recent years, the choice of software packages for small and medium companies has expanded considerably. Here are a few key points to consider in deciding which is best for you:
1. Does the package meet your core requirements, (ideally without customisation)?
All accounting software packages perform a core set of processes – managing invoicing, processing payments to suppliers, reconciling bank balance; but you may be looking for additional requirements such links to your MRP or CRM systems, or the provision of a particular metric for management reporting. A well-tried method for deciding which package best meets your needs is to carefully list all the accounting processes in your organisation, identify those which are (a) essential and can’t be modified, (b) those which can be tweaked to fit and (c) those which could be dropped. When you come to either running the software for a free trial period, or for larger packages, at the reseller’s demonstration day, this should be your checklist to determine the extent to which the package meets your critical requirements.
2. Cloud or server?
Key considerations here are cost (see point 3), access to upgrades (usually free on cloud packages) and security (cloud data is backed up automatically, server based data will be down to your own routines). In many cases, cloud based packages are proving both cheaper and richer in features than server based products and this trend is likely to increase in the future.
3. What is the whole life cost?
The initial package cost might appear very reasonable but you’ll also need to consider how many users this covers, what you’ll be paying for support, whether there are end-of-life compulsory upgrades (becoming less common. Sage was particularly prone to this but they’ve recently changed their policy), training and installation costs. And if you do require customisation, this can quickly become very expensive, with programmer time charged at over £1,500/day and often no guarantee that the customisations will meet your needs.
4. Can the software grow with your business?
Unless you have a very large volume of small transactions, even fairly substantial organisations will be able to use modest accounting packages to process their transactions. The problem may only appear when you need to manipulate the resulting data – while cheaper packages may struggle, more expensive packages will be able to process large volumes of data far more effectively, saving considerable time and effort when you’re analysing results or preparing accounts .
5. Are there additional add-in packages available?
As well as core accounting functionality, many products will have additional modules to manage payroll, e-commerce, inventory management, forecasting, credit card processing etc. An accounting software package which enables you to integrate these functions could save your accounts team a huge amount of time in re-entering data.
We’ve had quite a bit of experience in choosing and installing accounting software. If you’d like to discuss your ideas, please get in touch.