In Xero, you can view the platform as a demo company with pre-recorded data, which makes it far easier to see how the platform will look and operate when you input your own business’s data. There’s a reason FreshBooks made it on Zapier’s list of the best self-employed accounting software, while Xero made it on the list of the best accounting software for bigger businesses. FreshBooks doesn’t offer bank reconciliation with its least expensive option, FreshBooks Lite.

1. Integrates with more than 750 apps and offers live, in-house bookkeeping add-on.
2. In some ways, an accounting solution’s utility depends on how well it can exchange data with other back-end systems.
3. You can only use Xero online when working on your laptop or desktop.
4. You can also run reports like Profit & Loss and Cash Flow Statement to know exactly where you stand at tax time.

This doesn’t mean QuickBooks Online is the right choice for all businesses, though. Xero’s unlimited-users feature makes it a winner among larger businesses and well-established small businesses that require more than five users. It’s also less expensive than QuickBooks Online and a bit easier to use, thanks to its customizable dashboard and simple layout. When picking between the three accounting solutions, it really comes down to the needs of your individual business. If you’d like to see a simpler breakdown of our top providers, check our handy form today. So, to learn more about how we review accounting software and other types of tech products, check out our full research process here.

FreshBooks vs. Xero Comparison

For more advanced features, such as accounts payable and accountant access, you’ll need to upgrade to a higher plan. NerdWallet’s accounting software ratings favor products that are easy to use, reasonably priced, have a robust feature set and can grow with your business. Xero is a powerhouse accounting software, with the ability to create and send purchase orders, quotes, invoices and more with a few clicks. You’ll also get inventory management, accounting reports and cloud file storage, all on the base plan. Plus, Xero integrates with over a thousand apps, meaning you can personalize your inventory, payroll, CRM or time-tracking experience however you’d like. With the ability to send unlimited, customizable invoices, payment reminders and proposals to clients, FreshBooks is the optimal solution for freelancers or solo entrepreneurs.

With FreshBooks, you get simplified and automated accounting, invoicing, project management, and more. Plus, with industry-leading customer support, you’ll never struggle alone. Xero offers BI, reports and visualizations https://accountingcoaching.online/ via different hubs, dashboards and features. They can also track projects, manage contacts, use the Xero Hubdoc and file storage hub, or through reporting, inventory, sales and other features.

The quality you get for the amount you spend is the essence of bang for your buck. If you need to give accounting access to more than five people, Xero could be the better option for you. QuickBooks Online’s most popular Plus plan tops out at five users; its highest-tier Advanced plan allows up to 25 users, but that plan is expensive at $200 per month.

Traditional Business Accounting Software vs Cloud

Automated bank reconciliation allows you to create a summary report and export it to Excel. You can also run reports like Profit & Loss and Cash Flow Statement to know exactly where you stand at tax time. I started The Digital Merchant to test the tools, services, and products I use in my digital business.

With FreshBooks, users can embed checkouts in websites, social media and apps. The Advanced Payments feature also allows companies to accept credit card payments in person and over the phone. With a value score of 3.5/5 and a comparatively steeper starting price of $12 per month, Xero’s value offering is slightly less attractive than Sage. With Xero, you can also pay your staff and keep secure basic payroll records, all within your accounting software. You can set the payment frequency, the period covered, and the payment date. Also, you have the option to create and manage employee records, including bank details, and generate electronic payslips showing earnings, deductions, and total pay.

Plus, Xero doesn’t seem to care to consolidate its mobile experience into one app—there are different Xero apps for managing expenses, projects, and more. In fact, when signing up for an account, I had to download an entirely separate app just for two-factor authentication—a very unpopular requirement made clear by the app’s below-1.5 star rating. Zoho Books stands out for its 24/5 customer support, strong feature set and affordability. It’s ideal for businesses that already use in-house Zoho apps, since it has limited third-party integrations beyond that. While FreshBooks has a live chat option for sales inquiries, you have to send an email or request a phone call for customer support.

Sage’s unique cash-flow projection tool makes financial planning a whizz too. This, combined with its affordable monthly plans, make the software best suited to cost-conscious businesses that are able to get by without advanced accountancy functions. With some of the best accounting features we’ve reviewed and a wide range of useful integrations, our research suggests Xero is a better accounting software than FreshBooks and Sage.

The basic features for small businesses centralize accounting operations in one place. Users can see their invoices and manage their contacts and accounting online. Additionally, they can connect their bank and financials to the cloud to collaborate in real time, no matter cash flow statement where workers, accountants, managers and bookkeepers are. FreshBooks Payments lets your customers pay directly through invoices and automatically records each payment in your account. It can accept payment via debit cards, credit cards, bank transfers, Stripe and PayPal.

FreshBooks vs Xero free versions

We also recommend FreshBooks for freelancers and very small teams. These user bases must carefully monitor expenses and FreshBooks provides high-quality tools at low prices. Plus, freelancers and very small service-based businesses live and die by invoices ― FreshBooks’ bread and butter. We recommend FreshBooks for all business customers that prioritize invoicing tools. Of all the accounting software platforms we reviewed, FreshBooks’ invoicing functionality impressed us the most. Creating invoices in FreshBooks is much easier than in other platforms ― automatic invoice generation and customization are a breeze.

Xero used a timesheet that can be used to track time at a location, but it is not often considered its greatest strength, and there are provisions for integration options. FreshBooks has mobile apps, too, an Android app and one for iPhones. We have picked out some solid categories that can help you get an overview of the functionality of both online accounting desktop software.

Best Value: Sage

Inventory management is one of those advanced features that you don’t get in FreshBooks. You can keep a count of up to 4,000 items you have in stock as you buy and sell. Xero provides up-to-date accounting reports that enable you to track your finances and collaborate with your advisor in real-time. You can tailor the content and layout of your reports and reuse customized report layouts. FreshBooks provides you with an intuitive and insightful dashboard where you can conveniently access important reports like Profit & Loss, sales tax summary, expenses, and more. This makes tax time easy as you have all the numbers in one place.

You’ll just submit a support ticket, where you can attach any files that may make things easier to troubleshoot. If necessary, you can also give a Xero support person access to your account so they can take a closer look. Xero doesn’t have a phone number customers can call, but it can provide a callback if necessary. It’s expected that accountants have recommendations when choosing your cloud accounting tool.