The 5 Best QuickBooks Alternatives for Small Businesses

Billie Anne Grigg

Billie Anne Grigg

Billie Anne Grigg has been a bookkeeper since before the turn of the century (yes, this one). She is a QuickBooks Online ProAdvisor, LivePlan Expert Advisor, FreshBooks Certified Beancounter, and a Mastery Level Certified Profit First Professional. She is also a guide for the Profit First Professionals organization. Billie Anne started Pocket Protector Bookkeeping in 2012 to provide an excellent virtual bookkeeping and managerial accounting solution for small businesses that cannot yet justify employing a full-time, in-house bookkeeping staff.
Billie Anne Grigg
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You’re likely well aware that QuickBooks is the reigning incumbent for accounting software in the United States. There’s a reason that so many small businesses turn to QuickBooks for their business needs—it’s easy to use, inexpensive, and training resources for the software abound. But if you’re looking for a QuickBooks alternative, whatever your reason, great options do exist.

Although there’s plenty working in QuickBooks’s favor—industry dominance, ease of use, and a low price point, for instance—there are some QuickBooks alternatives for small businesses available you might want to consider when you’re thinking about your financials. We’ll examine all of the best QuickBooks alternatives (including some free QuickBooks alternatives), and compare what they have to offer so you can decide if they’re the right pick for your small business. But, if you’re in a hurry, here’s the short list:

Let’s explore each of these Quickbooks alternatives below.

The 5 Best Alternatives to QuickBooks for Small Businesses

As you’re looking at these QuickBooks alternatives, before you settle on an option, make sure your data isn’t “trapped” if you change your mind. You want to be able to easily move data in and out of solutions, especially if your needs change as your business grows. This is, of course, why it’s best to investigate several options before making your final decision!

You can usually (although not always) get an Excel or a CSV file of your data should you choose to switch software programs. Be sure to confirm that before signing up. This will save you from having to spend valuable hours re-entering data by hand.

QuickBooks Alternative Option 1: Sage 

Sage is a full accounting package. It produces a balance sheet and allows for bank reconciliations. Starting at just $10 per month for Sage Accounting Start, it’s very competitively priced, too.

Need more features than those offered in the $10 per month version? You can choose Sage Accounting for $25 per month to unlock unlimited collaboration, quotes and estimates, vendor bill tracking, cash flow forecasts, and the option to choose either cash or accrual basis accounting.

Like Intuit (the maker of QuickBooks), Sage has a wide variety of options for helping you scale your business, including an accountant partner program and its own series of conferences to help you learn, collaborate, and grow.

QuickBooks Alternative Option 2: Xero

Like Sage One and QuickBooks, Xero is also a full accounting package. This New Zealand-based company is the industry leader in New Zealand, Australia, and several European countries, too. Built “in the cloud, for the cloud,” Xero has avoided many of the perceived missteps its competitors have made when they transitioned to cloud-based accounting services, making it a great Quickbooks alternative.

Xero touts itself as “beautiful accounting software,” and, really, it is. Two of the things small business owners love most about this alternative to QuickBooks Online is the simplicity of its interface and its avoidance of accounting and finance jargon. No debits or credits here—just easy-to-understand language that makes it simple to determine what to do with your transactions. The reconcile-as-you-go feature is also a favorite of small business owners, though many accountants and bookkeepers prefer a separate reconciliation function.

Xero has three pricing tiers. If you’re a super-small business, the Starter package at $9/month may work for you. However, most small businesses quickly outgrow this package and move up to the $30/month Standard package. More complex businesses dealing with multiple currencies and larger payrolls need the Premium package, which starts at $70/month.

QuickBooks Alternative Option 3: FreshBooks

What started out as an invoicing- and time-tracking software has evolved into a powerhouse for the self-employed. FreshBooks lets you invoice and collect payments from your clients, track your expenses, and collaborate with your subcontractors. It also works with a suite of external applications to help you build a truly customized solution for your business.

If you’re worried about getting stuck on an issue with the software and having to wade through pages of online FAQs to try to solve the problem yourself, don’t be. FreshBooks has excellent customer-service associates who respond quickly to your questions, often replying within an hour.

What FreshBooks does not do is keep a balance sheet. A template is available if you need to create one, but FreshBooks recommends seeking the help of your accountant if this is necessary. This can quickly become a costly endeavor, so if your business needs a balance sheet, FreshBooks is not the right solution for you.

As for price, FreshBooks starts at $15 per month, though most small businesses will need the $25/month plan. There’s also a Premium option available for $50/month, but by the time a business reaches this stage, it will likely need a more robust solution.

QuickBooks Alternative 4: YNAB

Though technically not accounting software, many small businesses use YNAB as though it is. After successfully using it in their personal finances, it didn’t take savvy YNAB users long to determine how to take advantage of the software’s zones of genius—expense tracking, goal setting, and debt management—in their businesses.

YNAB does not have a balance sheet, it doesn’t handle invoicing or payroll, and there isn’t a bank reconciliation feature. But it does have bank syncing, beautiful reporting, and an avid support community to help you form and stick to your goals. While it’s not quite a free QuickBooks alternative, at $6.99/month (if paid annually), the price is definitely affordable.

Interested in substantially increasing the profitability of your business by leveraging your existing habits? This podcast episode tells how you can use YNAB with the “Profit First” method to bring clarity and awareness to your finances and proactively increase your profitability.

QuickBooks Alternative 5: QuickBooks Self Employed

Yes, we’re supposed to be talking about QuickBooks alternatives. However, QuickBooks Self Employed is not your traditional QuickBooks software. It really is an alternative to QuickBooks Online—at least the QuickBooks Online you’re thinking of. Designed specifically for the Schedule C filer, this version of QuickBooks has a great mileage tracker, receipt capture, and the ability to classify an expense as either business-related or personal with a quick swipe on your smartphone.

QuickBooks Self Employed does not include a balance sheet, nor does it currently allow you to upgrade to a more robust QuickBooks product. It does, however, allow accountant collaboration, and at $10/month it costs much less than the other QuickBooks Online options. 

What are the Best Free QuickBooks Alternatives?

There are free QuickBooks alternatives available, and many claim to be just as good as subscription-based solutions. Although some business owners use these free QuickBooks Alternatives with good results, free accounting solutions are often lacking in functionality, reliability, user experience, or customer service. You have to consider what this could cost your business. As your accounting software will be the backbone of your business, paying a small sum for a better system is most likely worth it. 

If you choose not to invest in an accounting solution and your business is very small and not complex, your best bet is to use Excel templates to keep track of your business finances. Beginner Bookkeeping has a library of free templates available, as well as explanations of basic bookkeeping principles so you understand how to use the templates.  

If you want to use this as a free QuickBooks alternative, here are a few of our favorites from Beginner Bookkeeping:

  1. Excel Cash Book
  2. Accounts Receivable Ledger
  3. Accounts Payable Ledger
  4. Cash Flow Template
  5. Income Statement Template
  6. Balance Sheet Template

Do I Even Need a QuickBooks Alternative?

The short answer is absolutely. Whether you’re using QuickBooks, an alternative to QuickBooks for small businesses, or a free QuickBooks alternative, you need one.

While certain things—like paying taxes—are obviously required of every small business, each business has its own specific financial needs. For instance, some businesses rely heavily on invoicing, while others collect all monies due at the point of sale. Some businesses set up payment terms with their vendors and need to track those bills for payment later, while others run everything through the company credit card. For some small businesses, the only business assets are the laptop the owner purchased to run the business, while other small businesses may have extensive fixed assets to track, manage, and depreciate.

Similarly, each business owner has a different style for actually running their business and making business decisions. Some need to know every single detail on a daily basis, while others are perfectly happy only having a big-picture overview once a quarter. Some business owners review financial statements closely before making business decisions. Others look at their bank account and make a decision based on the available balance.

No matter your financial needs or behaviors, all business owners need the same thing to handle all of the above: a great accounting system.

It’s absolutely worth it to put in the effort to find the right solution for your business. It will make sure you stay on top of your financials and make the best decisions for your business.

How to Decide Between QuickBooks and a QuickBooks Alternative

Hopefully, you’ve been convinced that you need an accounting system, whether that’s QuickBooks, an alternative, or even a free QuickBooks alternative.

Here is a list of questions you should ask to help you make the right decision for your business:

1. What accounting functions do you need to be able to handle?

Think about the following things you might need to do in your business:

  • Invoice your clients or customers for payment later
  • Track bills for future payment
  • Track and manage equipment or other business assets
  • Track income and expenses by job, project, or customer
  • Collect and remit sales tax
  • Manage payroll for yourself or your team

2. How often will you use your software—or reports from your software—to make business decisions?

  • Will you review your financial reports regularly, or do you just want to track income and expenses for tax purposes?
  • Do you need to be able to connect your accounting software to outside applications, like dashboards, to help you visualize your business’ performance?

3. What do you envision for the future of your business?

  • Do you want to keep your business small and privately held, or do you dream of eventually going public?
  • Do you think you will always handle most of your accounting processes in-house, or is one of your goals to outsource these tasks to an outside provider?
  • Are you open to the possibility of seeking small business loans and financing at some point in your business’ lifetime, or are you committed to operating completely debt-free?

There are no “right” or “wrong” answers here when you’re considering QuickBooks or a QuickBooks alternative. Be honest with yourself and how you want to operate your business. This will be the key to picking the right solution for your business.

Start Investigating Your QuickBooks Alternatives to Find the Right Fit

With these five QuickBooks alternatives, you’ve just barely begun to scratch the surface of what is available to small business owners. These popular alternatives to QuickBooks for small businesses may prove to be a good fit for you, or they may all fall flat. Most accounting software options offer a free trial period —typically 30 days—so you can try on different solutions before you commit to one. And, if you’re considering a free QuickBooks alternative, the only thing it will cost you is time.

Your financial data is an important part of your business, and financial data management can take hours of your time if you choose the wrong solution or set it up improperly. Whatever you decide to use, seek the guidance of an accountant or a bookkeeper to properly set up your software. Most of the options listed above have communities of professionals who are either certified in or extensively use the software. Once you have settled on your software, reach out to one of these professionals to help you get off on the right foot.

Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved, or otherwise endorsed by any of these entities.
Billie Anne Grigg

Billie Anne Grigg

Billie Anne Grigg has been a bookkeeper since before the turn of the century (yes, this one). She is a QuickBooks Online ProAdvisor, LivePlan Expert Advisor, FreshBooks Certified Beancounter, and a Mastery Level Certified Profit First Professional. She is also a guide for the Profit First Professionals organization. Billie Anne started Pocket Protector Bookkeeping in 2012 to provide an excellent virtual bookkeeping and managerial accounting solution for small businesses that cannot yet justify employing a full-time, in-house bookkeeping staff.
Billie Anne Grigg

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