5 Signs You’re Outgrowing QuickBooks
Is your business outgrowing QuickBooks? Our new blog series will help you explore many of the common questions, challenges and concerns we hear from businesses just like yours so you can make the most informed decisions about your accounting software.
Let’s get started with a simple question. Are you experiencing any of these five major problems with your accounting?
- You need better financial visibility
- You’re relying heavily on manual processes
- Completing daily tasks requires disparate tools
- You need to manage multiple entities
- Month-end close is excessively time-consuming
If you answered yes to any of these, you might be outgrowing QuickBooks. But, for big decisions such as whether to upgrade your accounting software, it’s important to be specific about what’s going wrong so you can figure out what you really need to solve your problems. With that in mind, let’s dive deeper into some common issues experienced by businesses that have outgrown QuickBooks.
Lack of Financial Visibility
For new businesses, the simplicity of QuickBooks can initially be helpful. However, as your business grows you might discover that you need to track a wider variety of information in order to fully understand your organization’s financial situation. Unfortunately, this is very difficult to achieve with QuickBooks.
For example, QuickBooks’ reporting functionality only has one dimension; you can’t track and sort data based on multiple metrics. This means that if you want to record a sale of items based on salesperson as well as the buyer’s industry and perhaps the type of item, you’re going to need to do this in an Excel spreadsheet. This manual process will inevitably reduce your financial visibility by making it difficult to track complex metrics in a timely fashion, which leads us to the next major issue…
Excessive Manual Processes
If you find yourself bogged down in time-consuming manual processes for daily tasks, or needing to do a significant portion of your accounting in complicated spreadsheets, your business has probably outgrown QuickBooks. Excel is great for certain things, but it shouldn’t be the go-to solution for your accounting.
In addition, an overreliance on manual processes can cause serious problems if only one or two people in your business know how to complete certain accounting tasks. If those knowledge-holders unexpectedly get sick or leave the company, it can be difficult to retrace their steps and recreate their processes.
Too Many Tools
If you use multiple, separate applications to complete an accounting task, that means you’re probably operating with reduced efficiency, less reliable data, and weak security. Using a variety of solutions can work, but ideally they should be integrated with your financial accounting system in order to increase automation and reliability.
Companies which have outgrown their QuickBooks system might find themselves consolidating information across platforms for everything from expense reporting and payroll to CRM and inventory management. At a certain point, each of these disparate solutions becomes an information silo, making it more difficult to track what’s truly happening in your business.
Some businesses work around this by choosing to use the select few applications which are able to integrate with QuickBooks, but for many industries these tools might not be well-suited for daily needs.
QuickBooks simply isn’t designed for multi-entity management. Using QuickBooks for multi-entity accounting requires logging in and out of a separate QuickBooks system for each of your entities, then extracting data from each one in order to manually consolidate in Excel. For two or three separate entities, this is a major headache. Some companies even find themselves doing this for ten or more locations – what a nightmare! In addition to consuming countless hours of time, this vastly increases the potential for errors and fraud.
Long Month-End Close
Month-end close shouldn’t take all month. In fact, for most businesses, it shouldn’t require more than a few days. If you’re wasting countless hours trying to close your books, you’ve probably outgrown QuickBooks. More robust accounting software can automate repetitive tasks and reduce the closing time to be counted in hours or days rather than days or weeks, allowing you to focus on higher value work.
Stay tuned for the next blog post in the series, “Outgrowing QuickBooks: Lack of Financial Insight.” In the meantime, if any of this rings true for you, download the whitepaper, Life After QuickBooks to dive more into these issues and determine if QuickBooks is holding your business back.
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