We recommend Zoho Books as the best accounting software for really small businesses, such as sole proprietors, freelancers, consultants, artists, and e-commerce and home-based businesses.
Why Zoho Books?
Really small businesses don't need really complicated, pricey accounting software. Zoho Books is a simple online accounting software that covers all the basics: create and send invoices, track expenses, sync bank accounts, create reports and do accounting on the go using a mobile device. But it also offers a full set of accounting tools that grows with your business. Although other accounting software providers can claim the same, what makes Zoho Books stand out is the low price for its capabilities.
Zoho Books costs $24 per month for an unlimited number of users. It's fair to say that there are cheaper alternatives — Xero, FreshBooks and QuickBooks, three of the top accounting software for small businesses, all start at around $10 per month. But here's the catch: Less expensive accounting software packages are only cheaper on the surface and likely won't meet your business needs or expectations. They cost less because they limit features, such as the number of users, transactions and capabilities.
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When we spoke with a Zoho Books representative, we confirmed that Zoho Books' $24 per month price tag gives you access to all of its features and offers unlimited everything, including invoices, estimates, bills, expenses, customers, vendors, currencies, projects and even users. In contrast, "cheaper" accounting software will require that you purchase pricier packages for the same benefits.
For comparison, here's how much you'll have to pay for the same or nearly the same capabilities for three of the top accounting software for small businesses:
- FreshBooks: It will cost you $29.95 to manage an unlimited number of clients, and only one additional staff member can access your account. Anything cheaper will limit your account to only 25 clients, and you won't have access to any project management tools. [Learn more: FreshBooks Review]
- Xero: Although all of Xero's plans offer unlimited users, its $9-per-month plan limits you to a measly five invoices and five bills, and you can only reconcile 20 bank transactions for any given month. You'll need to shell out for the $30- or $70-per-month plan to lift these limits. [Learn more: Xero Review]
- QuickBooks: The $9.99-per-month "Self-Employed" plan is limited to income and expense tracking, bank and credit card transaction downloading, mobile access and tax prep. You'll need the $26.95-per-month plan to do things like send unlimited estimates and invoices, and add more users to your account. Moreover, you'll have to purchase the $36.95-per-month plan to track inventory, create budgets and estimates, track sales and get access to other capabilities that Zoho Books already includes. [Learn more: QuickBooks Online Review]
Ease of use
Based on our research, many users find that Zoho Books is an easy-to-use accounting software, even for the most accounting- and tech-challenged small business owners. To see for ourselves, we signed up for a business account.
Setting up an account is easy. Simply enter your business name, contact information and password, and you're good to go. Next, you'll be asked about your industry and type of business. You can also opt to fill out tax information if you need help with tax prep.
One of the features we loved most about Zoho Books is how easy it is to use the dashboard. There's absolutely no clutter, and we could easily find our way using the sidebar menu, which is separated by task in an intuitive, logical way; it also collapses into icons when not in use, giving you more screen real estate in which to view the dashboard. This menu system makes it easy to add new items.
We also like how clean the layout is. Not only does the dashboard offer at-a-glance views of your business's financial performance, but it displays them in a visually pleasing way, so you can easily see and compare different metrics. Dashboard widgets include total receivables and payables with current and overdue amounts; a cash-flow chart with incoming, outgoing and current amounts; income and expenses; top expenses; projects with billable hours and expenses; bank and credit card accounts; and more.
To try Zoho Books yourself, consider signing up for a free 14-day trial— no credit card required. You can also learn more by attending one of the company's live webinars or watching introduction and tutorial videos on Zoho's YouTube channel.
Accounting is one of the most time-consuming, headache-inducing aspects of running a business. It was no surprise, then, that the small business owners we spoke with said the most important thing they look for in an accounting software are features that will help them save time and take away the stress of managing finances. We found that Zoho Books' automation and online payment features can help — even if you're a small business.
Zoho Books works under one underlying principle: to help business save time by working in a smart way, automating workflow and helping businesses get paid faster online. First, the service keeps you organized by streamlining processes and keeping everything up-to-date, all in a single place. You don't have to manually make sure all the data you need is current and available because the system does it for you. This includes financial data, customer information, transaction histories and more.
Zoho Books can also save you time by automating workflow. The sales rep we spoke with said this means the software can automatically perform tasks like sending invoices, setting up recurring billing, tracking expenses, notifying you with payment reminders and more. By automating the most common accounting tasks, Zoho Books lets you spend more time running your business and less time on repetitive tasks that could take hours from your workday if done by hand.
Another time-saving feature we liked from Zoho Books is that you can get paid faster with online payments. The sales rep also said Zoho Books can connect with popular payment gateways like PayPal, Authorize.net, Stripe, Braintree and 2Checkout, so customers can instantly pay their invoices online. It offers an efficient way for you to receive funds and keep track of paid and unpaid invoices, as well as provides a convenient, hassle-free way to pay for products and services.
One of Zoho's biggest selling points is its customer support. The service offers email and 24-hour phone support five days a week in the U.S., the U.K., Australia and India. You can also find help by searching the Zoho Books knowledgebase and customer forums.
When you call Zoho, you'll be greeted with menu options to reach different parts of the company — sales, tech support, billing and payment, or corporate — so you know you're actually going to the right department for the right Zoho service.
From a strictly sales perspective, however, getting ahold of a live sales rep was a bit of a challenge for us. We were able to reach the company's sales line immediately after following the menu options (Sales is option 1; then Zoho Books is option 5), but all sales reps were busy at the time. Instead of keeping us on the line with an approximate time that we'd be on hold, we were directed to leave a voicemail with our contact information to have a sales rep return our call. Depending on your preferences, having to wait for a sales rep to call you back may or may not be a good thing.
When we were finally able to speak with a sales rep, we were met with a friendly representative who was eager to answer all of our questions about the features and limitations of Zoho Books. There was no pressure to sign up for the service, though the rep did mention the 14-day trial if we wanted to give Zoho Books a test run before purchasing the paid plan.
Like many accounting software, Zoho Books has a mobile app, so you can do your accounting on the go. What makes Zoho Books' app different is that it isn't limited in functionality. The sales rep told us that in addition to managing invoices and quotes, tracking payments and expenses, and uploading receipts straight from a mobile device, the app gives you access to your dashboard for at-a-glance insights, reports and multiuser access.
In comparison, many mobile accounting apps are available only on iOS and Android, and are often limited to basic functions like creating and sending invoices, tracking expenses and reconciling bank accounts.
The mobile app is available for the iPhone, iPad, Android, Windows Phone and Windows Surface.
Despite its benefits, Zoho Books does have some drawbacks. Unlike some other accounting software, Zoho Books integrates with very few third-party productivity apps and business solutions. These include Google Apps, Square point-of-sale (POS) system and credit card processing app, and tax services track1099, tax1099.com and Avalara.
One way to get around this barrier is to use Zoho's own suite of business apps. Zoho offers customer relationship management (CRM) software, email marketing and social media marketing solutions, spreadsheet editors and other productivity tools.
Another disadvantage of using Zoho Books is that it does not include payroll services. This probably isn't such a big deal for really small businesses, but it's an important consideration for future growth and if you plan to hire more employees. Currently, the only payroll task you can perform on Zoho Books is preparing and printing 1099s with the tax services mentioned above.
Ready to choose an accounting software? Here's a breakdown of our complete coverage:
- How to Choose an Accounting Software
- The Best Accounting Software for Small Business: 2016 Guide
- Quickbooks Online Review: Best Small Business Accounting Software
- Wave Accounting Review: Best Free Accounting Software for Small Business
- Zoho Books Review: Best Accounting Software for Really Small Businesses
- FreshBooks Review: Best Accounting Mobile App for Small Business
- Xero Review: Best Accounting Software for Mac