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The biggest difference between QuickBooks Online vs. Desktop is that Online requires no installation on a computer and Desktop does. Product-based businesses with inventory needs typically work better with QuickBooks Desktop, whereas service-based businesses or businesses that use multiple devices typically choose QuickBooks Online.
Although I have most of my clients on the business accounting software QuickBooks Online (seriously, all but one), I think it’s always important to revisit the conversation of the main differences of QuickBooks Online vs. QuickBooks Desktop.
Today, there are more units of QuickBooks Desktop used by small businesses than QuickBooks Online. However, small businesses are flocking to the online version of the accounting platform. Did you know that 80% of new QuickBooks users are choosing QuickBooks Online vs. QuickBooks Desktop?
You need to know the differences between QuickBooks Online vs. Desktop—whether you’re starting to use QuickBooks for the very first time or you’re a loyal Desktop user considering the change.
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While I think it’s important to recognize how Intuit’s emphasis on QuickBooks Online will mean that product will get better faster, leaving QuickBooks Desktop behind, you still have to ask yourself whether or not QuickBooks Online is the right product for you now.
To do this, let’s look at the facts. Where do the products differ? Where do they excel? Let’s find out:
If I were to generalize where I think QuickBooks Desktop still holds a major advantage, I’d say managing large amounts of inventory (making it a great accounting option for retail stores) and job costing. But I think it’s important to list out the differing features specifically.
QuickBooks Desktop still offers the following feature sets that QuickBooks Online does not. If you can’t live without any of the below, then QuickBooks Desktop is most likely best for you. Keep in mind that some of the features below are only supported in QuickBooks Enterprise and Premier, and not QuickBooks Pro.
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Below are the features supported by QuickBooks Online that you can’t find in any version of QuickBooks Desktop:
Now, on that last point…
There are obviously some gaps between QuickBooks Online vs. QuickBooks Desktop. As QuickBooks Desktop has been around longer, it’s more powerful. But there are many, many 3rd party Quickbooks apps that can help you fill those gaps. I strongly believe there’s an app answer to any small business owner who thinks QuickBooks Desktop works for them when QuickBooks Online doesn’t.
Of course, you may not want to pay for 3rd party apps, and that’s something you have to evaluate when comparing the two.
I think the easiest way to make the decision between QuickBooks Online vs. QuickBooks Desktop is to first look at the accounting app features that QuickBooks Desktop has that QuickBooks Online doesn’t, and ask yourself:
Is there anything I can’t live without?
If you find something that you absolutely need in QuickBooks Desktop, see if there’s a 3rd party app that can do that for you with QuickBooks Online. But if there is no app, or you feel you’d pay too much to add apps and fill the gaps in QuickBooks Online, then QuickBooks Desktop might be for you.
Just remember: Intuit is notably investing more in their online products than their desktop products. Their online products will only get better and better. Not to mention, an online software is better in so many ways, whether for your own communication with your bookkeeper or accountant, your internal communication, or even saving money on file transfers or hosting.
Again, I know this isn’t always an easy question to answer (even if for me, it is!). Always consult with your bookkeeper or accountant (who hopefully are QuickBooks certified) before deciding, and if you’re not ready to make the change to QuickBooks Online now, prepare yourself that you’ll most likely have to make that change at some point in your business’s future.
If you’re interested in an online QuickBooks Desktop alternative that isn’t QuickBooks Online, consider Xero accounting software, a worthy competitor.