All businesses rely on technology to run efficiently and accounting software is no exception. With finances the heartbeat of all businesses, choosing the right software can be the biggest business decision you make.
From record-keeping to business intelligence (BI), accounting programs are continuously evolving to service different needs. Beyond the desktop, cloud computing also offers online software applications with propositions that shouldn’t be ignored.
Of course there are a host of desktop/web combinations that are available and don’t forget about the integration possibilities of the smart phone and tablets.
With all these choices popping up everyday, making the right one is a daunting task but essential to avoiding potential pitfalls.
Steven Cohen, MD of Softline Pastel, talks about how to choose the right technology and tools. There are a few essential questions to ask to guide your decision.
How complex is your business?
How many different products and services do you offer? Is your business cash-based or do you want a lot of different accounts? Do you import or export anything? The answers will tell you how much and what type of functionality you need.
How industry-specific do you need the package to be?
A professional services business requires different functionality from a manufacturing business. If you’re in retail, you’ll likely need point of sale functionality, if you’re in manufacturing, an inventory and warehouse management module is essential. Choose your package accordingly.
Do you anticipate growth?
You may want software that will grow with your business, allowing you to add functionality as it becomes necessary. Solutions like Pastel’s ERP system, Evolution, have a range of add-on modules which allows users to customise their functionality as the business grows.
What ancillary technologies will you want to exploit?
Mobile devices for your sales people? A website on which your customers can place orders? Automatically e-mailed customer invoices?
Once you have a better idea of your requirements, think about how the specific software can accommodate other technologies.
Would you need more than one user on the system?
Multi-user systems require networks or even a telecommunications infrastructure, should you have users in different locations.
Do you need online access to your accounting system?
In very small businesses, where the owner does almost everything, a system that’s purely online makes sense because he or she can transact from anywhere with an internet connection. More established traditional businesses may require dedicated accountants or bookkeepers working at workstations.
In other words, look at the total cost of ownership (TCO) of a computerised accounting system rather than just the cost of purchase. This includes things like ongoing (contract-based) support for your hardware and software and the cost of telecommunications.
Does your software supplier have a clear roadmap?
As new technologies come on-stream, your accounting system may need changing. Does the supplier you have in mind have a roadmap for such changes? Can you move to larger or smaller systems in the range?
Who is your most trusted advisor?
Your accountant is. He works with a lot of different packages and he knows your business well. He’s well-positioned to know what will work for you.
Custom-design or off-the-shelf?
Custom software is almost never a good idea for small businesses. Use an off-the-shelf accounting solution rather than having someone write software specifically for you. A much broader base of knowledge and experience goes into off-the-shelf packages as opposed to a single person doing one-off developments.
Look for track record
Buy from an established developer with thousands of satisfied customers. Ask other businesses what software they use and like. Read reviews of accounting packages.