5 Tips to Choose the Best Small Business Software Solutions for MSME'S
1. Paper Accounting vs. Software Enabled Accounting
Earlier, let it be large business firms or small and medium sized business firms, they maintained the books for a business in a paper ledger. But with the Advent of accounting software systems this scenario changed drastically. As of today, businesses of all sizes use accounting software to track their revenue, as well as to forecast sales and manage inventory instead of old school methods of book keeping and journalising everything on paper.
Business software solution greatly reduces the potential for human error that comes with accounting on paper, and it can allow you to access critical information with ease.
But with so many options available today, finding the right accounting software especially for small businesses can be difficult.
2. 5 Tops to Choose the Best Small Business Software Solutions for MSME's
To value Necessity and Accounting Skills
The best way for finding the right small business software solution is to look at how the business is operating, and then take careful stock of the different types of software’s available in the market.
Considering the type of industry, one might want to buy a specialized software that is designed to help businesses say for example, there are applications customized for businesses in the manufacturing industry, for retailers and restaurants, as well as for many other types of commercial enterprises.
At the same time, doing the ground research is important, because the application the businesses choose will directly have an impact on how the revenue is going to get managed.
It also becomes important consider that even though small business accounting solutions can make the task of keeping books easier, it still requires a certain amount of financial literacy. As refined as an business accounting software may be, it is just still only a tool in hand. Users of software must know what to do with it.
Valuing Features and Cloud Computing
Prepare a list of essential features that you absolutely need in an accounting software. The following are few features which must be part of a good accounting package.
- Create invoices and customise the look and feel
- Track expenses according to categories
- Manage inventory, inward - outward stock transfers and wastage
- Perform bank reconciliation by importing bank transactions
- Create purchase orders vouchers and record inventory purchases
- Create and manage taxes
- Record Journal Voucher entries
- Manage list of customers & vendors
- View account payables & receivables
- View Balance Sheet, Profit & Loss statement and Trial Balance reports
- Add additional team members
With cloud computing becoming a more prominent feature in modern business, it is important not to dismiss the many online accounting applications available.
Cloud based small business software solutions come with a variety of benefits. With cloud computing, data can be accessed from any location with a strong Internet connection, and you don’t need to purchase software licenses or servers to run them.
The installation of upgrades and patches is done on the server end, so you and your IT staff don’t need to worry about keeping the software up to date. It can be accessed using a tablet, laptop or smartphone etc., And more over it also makes sure that the records are kept secure at a data center far from the physical location of your business; this ensures their safety in the event of a local disaster or other destructive event.
Budget at Hand Keeping in view Scalability of Business Operations
Business accounting software’s are available to suit the budgets of different industries be it big sized firms or small and medium sized enterprises. Depending upon the needs the business accounting software’s have general applications for a broader user base which may be downloaded free or bought off the shelf at a lower price.
The more specifications added to a business software, the more expensive it gets, because the user base for specialized software is usually relatively small.
If you want something specific to your industry or customized for your company, you should be prepared to pay a premium and also be ready to accept the fact that when the business starts to grow, the accounting software will eventually fail to cope up with the progress and eventually as a business owner you may have to migrate to another software and such migration of data from an existing system to a completely new software could be s painful task.
So the trick here is to select an accounting software which can scale with your business needs. Few software’s in market offer only one version of the product and some offers progressive versions depending the business type or size. So the right choice is to go for a software that offers an entry level version as well as a feature rich version which you might not need now but will definitely need in future.
Knowing the Interface and add on Features Available
Most of the business owners do not have any accounting background. Even though you have a dedicated accountant who would be using the application, as an owner you should be able to login and browse the things. It should also be easy enough for your employees to learn the software as investment in training is a painful cost and should be avoided.
Add ons bring extra functionality to a business accounting application. For example, they may allow you to access the software remotely, accept payments online, and integrate the accounting software with your ecommerce software. There are also add ons that make business accounting software compatible with tax software.
Decision to buy Indulging your Accountant Keeping Open the Exit Options
The accountant appointed by you may prefer that you choose an application that is compatible with the ones he or she uses. Every business and it’s operations are different from the other ; here your accountant is in the best position to offer an educated opinion about which one is best choice for your particular enterprise. Your accountant is in a good position to be able to help you set up the software you choose.
Any business accounting software you choose, remember that you aren’t committed to it for life, since most software allows for some form of conversion. Still, the decision shouldn’t be made lightly as you will not be in a position to make a commitment to one application and begin investing time into it, only to find out that you have to switch to another one just a few months later.
About Exit Options
Consider if the company you are buying the business software from shuts down its operations or you discover lot of bugs few months after the purchase. To safeguard from such situations, ensure that the accounting software provides data export facility.
The business software should be capable to export ledger and other transactions at least in the form of excel as most other software’s will accept excel file for the import.
Exploring and finding a perfect accounting software for your business is not an easy task. Because once you invest your time and money into one accounting system, it will be very difficult to migrate to another after some time. It is therefore always better to spend more time before the purchase to save frustration a later stage.