We live in a golden age of information and organization software. There are so many options to help you get organized that the real problem is knowing where to start.
Cloud accounting is no different. There are endless service providers in the space, each marketing its version of cloud accounting. Most providers offer a free trial period, allowing businesses to try out their services for a brief period before choosing to go for a paid subscription. Others offer a limited version of their product at no cost.
Today we’re discussing free cloud accounting software and offering tips for those shopping around. Everyone in cloud accounting advertises top-end quality on a user-friendly platform, but experience sometimes tells a different tale. Quality services that offer free versions exist, but not all cloud accounting software services are created equal.
Here are four things to consider before adopting a free cloud accounting software;
Adoption Pains
Adopting a cloud accounting software will come with many benefits. These benefits include: easily tracking company transactions, payment and invoicing reminders, and performing bank reconciliations. Still, before your accounting system starts humming like a well-oiled machine you’ll have to spend time and effort integrating it into your company’s ecosystem.
You’ll have to upload old financials, set up the processes to enter new ones, and transfer client orders or outstanding invoices, etc. etc. That’s why most businesses don’t switch systems regularly. They understand that, like learning a new instrument, changing an accounting system takes time. If you feel like you’re struggling to make the switch, don’t hesitate to reach out to an expert.
Once you choose a cloud accounting service you may not be locked in by contract, but you will be committed by the time and effort you spent to adopt the said system.
Here’s where it’s important to choose a user-friendly service. Good product design can significantly cut adoption pains. But more importantly, adoption pains are why free cloud accounting software isn’t actually free!
Scalability
Before you adopt a free cloud counting service, you need to make sure it can scale up and meet your needs. As your company grows, you acquire new accounting needs. Your cloud accounting software should be able to meet them. If you start with free cloud accounting software for basic bookkeeping and billing, you should consider switching to a paid version later and get more tools without needing to adopt a whole new software.
Free cloud accounting software is usually a basic version of the software with broader capability. Some companies even allow you to add features as you need them. Like adding minutes or data to your phone plan. Before you adopt a new software make sure it has lots of room for growth. Also, make sure it has the feature/s you will need in the future as you grow
Accountant
Cloud accounting doesn’t eliminate the need for an accountant. You still need someone to advise on tax filing and optimize your financial flow. Before adopting a new cloud accounting service check in with your accountant. If you don’t have an accountant, reach out to one. An account will tell you which service they use and why. This information serves two purposes. 1) you can use the same service as your accountant seamlessly integrates with your CPA. 2) Accountants are perfectly positioned to evaluate cloud accounting services based on their utility.
When you check in with your accountant, you are setting yourself up for efficiency in the future and getting advice on the best service from someone in the know.
Hidden Costs
Beware of hidden costs. Some cloud accounting services advertise as free but actually postpone payment. You don’t want to start implementing a new system only to find that some crucial feature is hidden behind a paywall and that the cost is more than the paid version of a highly-rated software.
Before adopting free software take a close look at what services are offered for free and which ones you’ll have to pay for. For example, if your customers can pay online, you’ll likely have to pay for that. Think hard about which features you’ll need and note their price.
Conclusion
Free cloud accounting software is a tempting option for business start-ups. For some, it might be the best option. There are some decent free options out there. At the same time, just because a software is free to start doesn’t mean it will save you money long-term.
Before you start the process of integrating a new cloud accounting software into your business process;
- Think for the long-term (you don’t want to be changing cloud accounting software more than necessary),
- Check if the software will scale up with you. In other words, think of all the features you’ll need and make sure it can provide them,
- Check in with your accountant and ask their advice on your intended option,
- Look for hidden costs–make sure the features you’ll need aren’t actually behind a paywall.