Quickbooks Online vs. Xero and 5 Alternatives for 2023

When we say “Accounting,” you usually think of taxes, money management, invoices, and a lot of overwhelming related stuff. Those could be mind-itching things, especially if you imagine yourself dealing with them on Excel or Google Sheets. Even if you are a small-to-mid-size company or a startup, things could get really messed up combined with government regulations To avoid your accountant getting depressed at the end of the quarter, look for solutions, consultations, or maybe for accounting software. In this article, we are going to compare two of the highly rated accounting tools around the world for small businesses and startups. and Quickbooks Online (QBO) Xero Plus 5 Top Alternatives to consider in case none met your requirements. Considering that you have a solid grasp of accounting software, let’s dive in. Quickbooks Online and Xero briefly Both are cloud-based accounting systems designed to back up businesses with info and capabilities to view their finance status and run their daily transaction and banking reconciliation. Each one of them is the number 1 competitor for the other in the SMBs market, however, with a different set of features both have, many businesses struggle to choose the right one that provides the perfect fit. To make things easier to comprehend, we will start by comparing features plan by plan of both software and then circle back to the overall comparisons like the ease of use, customer support, and integrations Quickbooks online “Simple Start” plan (30$) Vs. Xero “Starter” plan (25$) Both companies offer a freemium trial (demo) and guidance to help you choose the right plan and 24/7 support for all plans and subscriptions, in addition, you can also use their mobile apps to run transactions more smoothly but with limited options compared to desktop usage. Let’s start with Quickbooks online. This is the very beginning plan of QBO backed with features businesses can utilize to: 1. Manage income and expenses Import transactions from multiple sources. Auto-sort for taxes. Snap & match receipts. Organize custom tags into 40 groups for spending insights. 2. Invoice and payments Design branded invoices with your logo, sendable from any device. Get instant online payments, track status and set reminders, manage recurring invoices, and connect via QuickBooks Business Network for direct sharing. 3. Tax deduction Share books with an accountant, and export for taxes. Easily categorize income, and expenses. Auto-sort business expenses for better earnings. 4. General reports Generate/export profit&loss, expenses, and balance sheets. Use custom tags for income/spending insights. Track cash flow, and avoid surprises on the dashboard. 5. Receipt capture Snap on-the-go receipts. Upload/email to QuickBooks quickly. Match to expenses, and sort into tax categories for tax confidence. 6. Mileage track Automatically track miles via GPS. Sort business/personal trips, manual addition. Share reports for mileage breakdown, and deductions. 7. Manage cash flow Predict cash flow 90 days ahead, plan better. View all balances on one clean dashboard. Get QuickBooks Checking for fee-free instant deposits. 8. Send Estimates Tailor estimates to brand and needs. Accept mobile signatures, and track instantly. Effortlessly convert estimates to invoices. 9. Sales and sales taxes Take cards anywhere via mobile reader or sync with apps. Integrate with Amazon, eBay, and Shopify. Auto-calculate invoice taxes. “ In this plan, you are allowed to only connect 1 sales channel” On the other hand, Xero, at the first plan offered: 1. Online invoicing Add logo to online invoicing for a personal touch. Provide diverse payment options. Automate payment follow-ups. Send on-the-go invoices from your phone. (Limit of 20 invoices) 2. Pay bills View upcoming bills and ensure timely payments. Perform batch payments, and schedule in advance. Access all your bills online from any location. ( Limit of 5 bills) 3. Bank reconciliation Stay current with daily bank reconciliation. Accept suggested reconciliations for quicker processing. 4. Capture data with Hubdoc Snap, email, scan, and upload docs. Add info to Xero for easy reconciliation. Convert statement to CSV, import—access bills/receipts anywhere. 5. Short-term cash flow and business snapshot Rapidly grasp your near-term cash flow. Gain a consolidated business overview. Track progress via a unified dashboard. Not to forget that Xero also offers add-ons that enhance the user experience with an added cost of: 1. Claim expenses Speed up expense claims, paperless. Instantly approve claims. Real-time expense tracking. Phone-based mileage and expense claims. 4$ 2. Track project Track costs via timer or location. Auto-integrate with Xero. Invoice customization with the 'Pay now' option—dashboard for profit margin monitoring. 7$ 3. Analytics plus Swiftly grasp short-term cash flow. Unified business overview. Track progress via the dashboard. Enhanced with customization and predictions. 7$ It is crystal clear that QBO, at the first plan, offers a wide range of capabilities compared to Xero. However, this is not a sufficient reason to go with one another. Let’s see the second plans of both and what they have to add. Quickbooks Online “Essentials” (55$) Vs. Xero “Standard” (40$) QBO at the Essentials plan adds features such as: 1. 3 sales channel integrations While in the first plan, only one sales 1 sales channel was offered, in the essentials plan you can have more two channels like Amazon, eBay, or Shopify 2. Include 3 users "Invite your accountant and employees for smooth collaboration. Grant specific access, reduce errors with auto-syncing, ensure data security, and share reports hassle-free." 3. Bill management "Centralize bill organization, schedule, and pay online in QuickBooks. Free bank transfers, and card payments with a 2.9% fee. Opt for a deposit or $1.50/check payment. Auto-import bills via QuickBooks Business Network." 4. Enter-time "Input team hours or grant access for self-entry. Include time in invoices. Track costs, and run reports. Use QuickBooks Time for auto tracking and remote project management." Xero at the Standard plan adds only: 1. Bulk reconciliation Stay up-to-date through daily bank reconciliation. Review and approve automated account reconciliations. Bulk code transactions, except for Starter plans Also, the add-ons are available for all plans in Xero. Quickbooks Online “Plus” (85$) Vs. Xero “Premium” (54$) This is the last plan for Xero but not for QBO. Users of QBO have the option to upgrade to the last plan of it, which is “Advanced.” This plan targets mid-level companies and mature organizations. We will not mention it in this guide since we are focusing on small businesses. In addition to the Essential plan of QBO, at the plus plan, you can also get the benefit of: 1. Inventory management "Monitor products, costs, get low inventory alerts. Analyze popularity, order, and handle vendors. Excel import, sync with Amazon, Shopify, Etsy, etc." 2. Project profitability "See all projects at a glance. Track labor, payroll, and expenses with job costing. View project profits through dashboards and reports." Hint: This is the perfect plan for you if you are running an e-commerce business and interested in using the product of QBO. Xero at the Premium plan here completes its feature list by adding the following: ==1. Multi-currency == "Xero automatically converts global transactions. Understand currency market impact on cash flow and profit. Access reports in either local or foreign currencies." And no need to say that this plan could provide the perfect fit for you if you are dealing with multiple currencies. This is a quick overview of the features of both software. if you want to look at a real-use example of features for QBO and Xero checkout this for QBO: https://youtu.be/MdPfY4vcbmk?embedable=true Note: that the pricing page in this video for QuickBooks online isn’t the same as the current one. The current one And check out this one for Xero: https://youtu.be/xvOJDfsrHDQ?embedable=true Again, the pricing page has changed for Xero, check out the current one . here Features aren’t the game changer in the realm of the software market. We have to also check for things like: Ease of use. Integrations. Customer support. Quickbooks Online Vs. Xero: Ease of use Ease of use is relatively different from one to another; it actually depends on your familiarity with the overall accounting terms and your adaptability to any tool out there. I have read more than 80 reviews for both Xero and QBO - the lowest and highest ratings- For , the tool is a user-friendly, customizable layout, offering a quick overview of profit and loss, expenses, bank account balances, invoices, and sales. QBO BUT… I have noticed that people writing about how easy and user-friendly QBO is are mostly in directors/ CEO or accountant positions. That doesn’t necessarily mean the tool is not for everyone. QBO offers a dashboard that is easy to navigate and customize to add the best business snapshots that can help you to make better decisions. Reading the reviews, I can say there are some common issues OBO users face: Poor results from the search function- in the right corner of the dashboard- sudden updates that left the user unable to switch to default without customer support. hard to sign up from a different device. For , the tool looks fresh and easy to navigate since it labels and combines all of its features in four main pages on the dashboard-Business, Accounting, Projects, and contacts- with an ability to contact support in each data entry section to avoid miss-clicks. Xero With customizable widgets on the dashboard, you can choose the business snapshots to place on the main page that is most useful for you to run your finance. Reading through reviews, I noticed that most critical reviews aren’t mentioning difficulties in the use of the product but rather other issues related to features. The blog post and comparison pages I read before writing this article mainly were saying that the edge of ease of use goes to rather than , which seemed to be an unobjective and biased approach. Xero QBO To not fall into this trap, I will let you decide according to the data from , , and software review websites. G2 Capterra Getapp The rating of ease of use in the three websites for both tools was like this Ease of use G2 Capterra GetApp Quickbooks Online 4.3 4.3 4.4 Xero 4.0 4.2 4.0 Quickbooks Online Vs. Xero: Customer support Both do their best to support the customer's life cycle with various resources and guides. Here is what have to back up their users: Xero and QBO QBO Xero In product help Email support User community User guides Knowledge base Knowledge base + community discussions Product Training Help articles&Guides Help articles&Guides In product help&trainig Connecting with a support agent through email, messaging, or a phone call Request support from an agent from the website here takes agent support further compared to which makes sense since the customer base of is bigger than QBO Xero, QBO Xero’s. When it comes to user reviews, I found that some of them say that customer support is perfect, written with a 5-star rating. At the same time, some of the reviews say that customer reps are unavailable, incompetent, or out of reach. Such reviews were written for both. This is confusing, isn’t it? If we were to look at the other side of the circumstance, it would make much more sense if we assumed that those complaining users didn’t leverage resources and product training in the first place. Most users scan or maybe don’t read guides and help articles and jump right away to request an agent's help. Such users make it harder for customer support to keep up with them, which also makes the waiting duration longer for users with serious obstacles. It is absolutely okay to ask for help from customer services but not to waste your time waiting for the return call. Leverage every source they have provided for you and get to know the essence of the product in the demo trial. This is the rating of of both companies, from and Customer support G2, Capterra, GetApp: Customer support G2 Capterra GetApp Xero 3.85 4.0 4.1 QBO 3.75 4.0 4.0 Quickbooks Online Vs. Xero: Integrations Your Accounting Software is one of your core tools that help run your business, and for maximum results, a good tool integrates with other tools like: CRMs Secure payment platforms Time tracking Reporting tools E-commerce Email marketing tool Both and offer a wide range of integration capabilities. Check out what integrates with from , and what integrates with from . Xero QBO Xero Here QBO Here Who wins? Answer: None of them. The purpose of this article was to guide you toward choosing one that may work for you, not to proclaim the best in the market. Understand what you actually need and why. Try to find answers to what is keeping you up at night. Contact sales and leverage every source and guide to get the utmost benefit of the demo trial, or better yet, reach out to current product users if sales reps can’t address your objections. If you're not done researching or feel that none of them would be the missing tool in your business’s structure, here are some alternatives to and Xero Quickbooks Online. 5 Quickbooks Online and Xero Alternatives : Best affordable accounting system for on-budget sole proprietors 1. Wave Businesses looking to avoid additional subscription fees may find Wave's user-friendly accounting software and free plan ideal. Similar to Stripe or PayPal, the platform makes money by processing online payments and keeping a percentage of the transaction fee. Currently, fees for bank transactions are 1% plus a $1 minimum fee, while credit card purchases are charged 2.9% + $0.60. In addition, Wave generates money with a payroll plugin that automates salary distribution and document management. https://youtu.be/liy-T2VCwHU?embedable=true Users can also take advantage of accounting coaching services and bookkeeping specialists to boost their confidence during tax season. The platform's colorful user interface has a dashboard for cash flow insights, several reports for profit/loss and balance sheets, and other necessary business tools. ; online payments are charged at a percentage plus a fixed rate : Pricing Free G2 review page Wave is only available in the United States and Canada. : best for in-depth reports and analytics 2. Sage Accounting Sage offers specialized accounting software for companies of all sizes, projecting a corporate and professional image for straightforward accounting solutions. Notable features include filter- and date-based reports that may be customized, including audit trails and cash flow statements. However, there may be a learning curve. Sage Business dashboard provides comprehensive insights through data transfer, making it appropriate for contexts that are data-rich. Extensive visibility, simple bank integration, automated transaction categorization, and tax features like sales tax tracking and 1099 reports are all provided by the dashboard. With data extraction and sorting, unlike other mobile apps of Xero and QBO, Sage's paid AutoEntry feature -available on the mobile app- tool shines beyond receipt collection and can handle a variety of documents. Even if integration with 31 marketplace apps is beneficial, there may be an extra subscription fee. starter plan of 10$, last plan 25$ : Pricing G2 review page : best for software suite integration 3. Zoho Books Zoho Books offers a comprehensive software suite that addresses a range of business needs. The software offers solid professional skills despite occasional interface congestion. Project, time, and inventory monitoring, among other crucial bookkeeping capabilities, are all included in Zoho Books. Although getting used to the interface's amount of information may take some time, custom account limitations are possible with the budgeting tool, making it appropriate for company budgets. https://youtu.be/evZ3aDbt3lA?embedable=true There are numerous possibilities with customization features in the reports area. Accounting software has parts specifically designed to capture tax payments and other events, making it accessible to both users and invited accountants. Zoho interfaces with nine payment processors for online invoice payments, even classifying Stripe transaction fees. It is possible to integrate external and internal apps with Zoho apps. Zoho Books offers effectiveness without superfluous extras, making it a dependable tool for business accounting. A free plan is accessible, while the paid plans commence at per organization per month. Supplementary users can be incorporated into any plan for an extra per month. : Pricing $12 $3 G2 review page : best for sales and accounting integration 4. OneUp OneUp is a user-friendly solution with a simple layout that includes separate "apps" for accounting, CRM, invoicing, projects, costs, and purchasing. A search function, in particular, makes navigating easier by providing quick access to required actions. Users can activate only the apps they actually need thanks to the platform's adaptability, which can result in a minimalist or feature-rich experience. Comprehensive client management is made possible by seamless integration between the CRM and other apps. The feature's seamless integration of billables, customer interactions, and contact information supports both sales and accounting operations. While there are some basic tax preparation features in place, manual time tracking facilitates more extensive processes. OneUp's inventory management excels at preventing product shortages for commonly purchased commodities through automatic ordering. Starting at $9/month, you'll need the $19/month plan to invite business partners or accountants and access support, with prices scaling according to user numbers. : Pricing G2 review page : Best for tracking vehicles and mileage 5. LessAccounting A user-friendly accounting system with a visually appealing dashboard that gives crucial company data is provided by LessAccounting. The layout of the software implies a dedication to making accounting activities simpler. The software includes written instructions that can be used to complete routine tasks or to clarify certain tax and accounting concepts. Customer service is easily accessible via chat. There are available options for basic bookkeeping, such as recurring invoices and proposals. The capability to track mileage for company vehicles is a unique feature, ideal for companies with a fleet. The process of creating a spending category budget is simple and resembles personal finance budgeting. The program automatically delivers "Monday emails" that include company statistics and budget reminders. Options for payment connection include Stripe, WePay, PayPal, and Square. LessAccounting offers transaction processing at a rate of 2.7% + $0.30. The company's in-house staff of accountants for assistance, aiding during tax season. Diverse reports provide multifaceted insights for both business analysis and IRS compliance. : There is a free plan that covers invoicing, and for more advanced accounting capabilities, paid plans begin at $24 per month. Pricing G2 review page The bottom line The decision between QuickBooks Online and Xero in the realm of accounting software ultimately comes down to the particular requirements and preferences of your company. Both platforms provide a variety of tools, integrations, and customer service to assist you in properly managing your funds. You may make a well-informed choice that supports your business objectives by taking into account elements like ease of use, integration potential, customer support, and some particular features. The good news is that you aren’t stuck choosing between two options. SaaS is way much broader these days, that’s why take a look at other tools like Wave, Sage Accounting, Zoho Books, OneUp, and LessAccounting, to make sure you get the right solution to simplify your financial operations and support the expansion of your firm.