FreshBooks Review 2018 | Key Things to Know Before You Start

Last updated  on February 11, 2018 09:00 EST

FreshBooks is my accounting software choice for freelancers, but should also be a serious contender for a number of small and medium-sized businesses. If you're in need of an easy way to send invoices, collect payments and track billable hours, then look no further than FreshBooks! Rest assured that it will save you lots of time and energy on your accounting!

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freshbooks review in brief - top pros and cons

Top FreshBooks Pros

#1.

The easiest to use accounting software

The simplicity of FreshBooks should be applauded - its clean interface and functionality have clearly been designed with the end user in mind, hence why it's the perfect accounting software choice for freelancers.

#2.

Exceptional customer service

FreshBooks has excellent customer support (via email and phone), which I've found more personal and proactive than some of the other accounting software providers. There have also been various instances where FreshBooks have quickly implemented changes suggested by users to improve their product, which is just amazing!

#3.

Smooth invoicing process

FreshBooks is set up for fast and efficient management of invoicing. It offers an excellent level of invoice customization compared to peers, allowing you to choose one of two invoice styles and the theme color, and add your company logo, in addition to the usual items you would expect to include in a client invoice. The ability to schedule recurring invoices for clients is also very helpful.

Top FreshBooks Cons

#1.

Not a full double entry accounting system

Whilst FreshBooks offers the core functionality to run a business (e.g. revenue and expense tracking, accounts receivable and payable, etc.), it doesn't allow you to track and produce full accounting statements for your business (i.e. income statement, balance sheet and cash flow statement). Whilst this isn't a major problem for freelancers and very small businesses, some larger SMBs may find a more complete accounting software package such as Xero more relevant.

#2.

The client limit may end up biting you

The Lite ($15 per month), Plus ($25) and Premium ($50) packages have active client limits of 5, 50 and 500 respectively (though note its possible to archive or delete clients, which do not count towards the limits).  If you're taking on a large number of new clients, you may find that you'll have to upgrade, which can become quite expensive.

#3.

No inventory tracking module

If you're a sole trader or small business selling physical product, then FreshBooks may not be the choice for you. In your situation, you may want to go with an accounting software provider that allows you to at a minimum track your sold and remaining inventory.

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freshbooks pricing review

FreshBooks' competitive pricing model means that it is accessible to most freelancers and small and medium-sized businesses without breaking the budget. FreshBooks offers a 30 day free trial (without requiring a credit card), which is great as it allows you to spend a bit of time testing out the features to see if it suits your needs before committing.

FreshBooks has 3 different levels of pricing / packages - Lite, Plus and Premium.

As you move up the tiers, the maximum number of client you can bill goes up. Whereas other providers differentiate tiers mainly through the range of features, FreshBooks is different as its tiered pricing model focuses on number of clients instead - with limits of 5 in Lite, 50 in Plus, and 500 in Premium, respectively. It's worth flagging that if clients are deleted or archived in FreshBooks, they do not count towards these limits.

​Prices based on rolling monthly plan. Click image to see FreshBooks pricing plans

If you sign up on a month-to-month payment plan, expect to pay $15 per month for Lite, $25 per month for Plus, and $50 per month for Premium. If you sign up for a 1-year plan, you can save 10% per year, which equates to yearly savings of $18 for Lite, $30 for Plus, and $60 for Premium.

All the pricing above is based on single user access. If you would like to arrange access for additional employees, then this will cost an additional $10 per person per month. Note that you can add an unlimited number of contractors at no additional cost - further information is provided below in the FreshBooks User Access section.

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freshbooks ease of use

You'll see at the top in the "Pros" section that I believe FreshBooks is the easiest to use accounting software provider. Given the simplicity of the interface and excellent navigational tools, I found it straightforward to set up an account in a few steps, and find what I needed immediately. Everything is intuitive and there's lot of help available, so you shouldn't be left confused at any stage!

The dashboard is incredibly clean and set up with the user journey at the forefront. Down the left-hand side margin links to the main areas you'll need are set out - Dashboard, Invoices, Estimates, Clients, Expenses, Projects, and Time Tracking. The large green drop-down box in the top right-hand side allows you to easily create a new invoice, client, estimate or expense. In the main body, there are charts showing the company's financial position - outstanding revenue, total profit and spending - and a section at the bottom to run more advanced reports.

Credit: FreshBooks

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freshbooks invoicing 

With FreshBooks, you can finally stop worrying about invoicing and start getting paid much faster! With FreshBooks you can seamlessly create, send and manage invoices from your computer or mobile app.

After two simple clicks on the dashboard to create a new invoice, you're directed to the page below, which sets out the invoice template. It's useful being able to preview the invoice as you make changes - this is not possible for most other accounting software providers.

Credit: FreshBooks

Invoices look clean, professional and can be customized to match the identity of your business - you have the choice between 2 templates, and then for each you can change the theme color to match your business colors. I particularly like the option to add your company logo at the top of the invoice. 

Once you've filled out the relevant invoice details, you can immediately send it directly through FreshBooks (as an email or shareable link), therefore saving you the hassle of downloading it and emailing it separately. FreshBooks monitors when invoices have been sent, viewed by clients or (partially) paid, which you can see on the "Invoices" section. 

There is an option to set up recurring invoices, which is useful if you are billing clients on a regular basis, and also duplicate old invoices manually. If credit card payments are set up (see below), clients can set up recurring payments for recurring invoices, increasing convenience for everyone and more importantly reducing the time for you to get paid!

Also, for particular clients or specific invoices only, you can schedule customized payment reminders  and add late fee charges to invoices (either as a percentage of flat-rate).

Client portal

FreshBooks allows your clients to sign up to a client portal, which lets them manage and pay their outstanding bills, receive estimates and proposals, and view projects. The client portal has exactly the same look and feel as the main FreshBooks application, and is just as intuitive to use.

Credit: FreshBooks

Estimates or proposals to invoices

FreshBooks allow you to send clients estimates or proposals for work through its platform (similar to invoices). These can subsequently be converted in a few clicks into invoices, which saves a lot of time compared to having to start new invoices. When in the "Estimates" section of FreshBooks, simply click on "More Actions" in the top right-hand side, then "Convert to Invoice".

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freshbooks payments

By signing up to FreshBooks Payments (powered by WePay), you can accept credit card payments and get paid a lot faster! The cost of this is a transaction fee on all card transactions of 2.9% + $0.30 for Visa, MasterCard and Discover, and 3.5% + $0.30 for American Express. There are no other monthly or setup fees. Alternatively. you can also sign up for payments via Stripe, for which the cost is 2.9% + $0.30 per transaction. Quite helpfully, these transaction fees are automatically calculated and categorized as expenses by FreshBooks.

By accepting credit card payments, clients can pay directly from the invoice page they land on once they click on the link in the email received (assuming the invoice was sent electronically), or alternatively from their client portal.

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freshbooks reporting

FreshBooks has the ability to generate a handful of key reports for core financial items you would expect to track, including profit & loss, sales tax, accounts aging, invoice details, expenses, time entry and payments collected.

However, for some more complex businesses, the level of detail provided may not be sufficient. Also there isn't much scope to customize reports - if these is important to you, then you may need to look elsewhere for your accounting software solution.

Credit: FreshBooks

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freshbooks support

The support provided by FreshBooks is of a very high quality! Support is available between 8am-8pm ET Monday - Friday via phone and email. As part of my assessment, I did reach out to FreshBooks' customer support with a range of easy to difficult questions - in all instances, I found the quality of support very high. In addition to the above, there is a wealth of informative and teaching material online, including knowledge base, videos and webinars, so you're very well covered. 

FreshBooks take customer feedback very seriously, often implementing user suggestions quickly to improve their software - as a result, their offering is continually improving and expanding with new features.

If I did have a slight criticism, it would be that 24/7 support isn't available, but this shouldn't be a major issue for most users who operate during normal business hours. Also for users based outside of North America, support is still based around the US time zones, meaning that there may be delays in getting your answers.

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freshbooks mobile app

Use of the FreshBooks mobile app is included at no extra cost (available on iOS and Android phones and tablets), and as you would expect, it's just as user friendly as the desktop version. The great thing about the FreshBooks app is that it offers functionality that almost matches the desktop version - this is especially useful if you prefer to complete your accounting tasks on the go.

Functionality includes:

  • Invoicing, estimates and proposals (including creating and sending)
  • Client management (including chat function)
  • Expenses (including snapping pictures of receipts)
  • Time tracking (especially useful if you're working on multiple projects for various clients)

Credit: FreshBooks

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freshbooks project management and time tracking

FreshBooks makes it incredibly easy to keep track of hours worked for projects and clients, and subsequently generate invoices using that information - this is flagged as one of the most beneficial features of FreshBooks by freelancers and small companies involved in service or project based work. You can also set up multiple projects under the same client.

Credit: FreshBooks

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freshbooks user access

FreshBooks offers 3 levels of user access:

  • Business Partner - this is designed for other key decision makers in the business. This option allows users to view the dashboard and financial reports, create invoices, estimates and projects, manage clients and your team, track their own time and expenses, and also review time and expenses tracked by the rest of the team. This option does not allow users to cancel the FreshBooks account, or manage add-ons, integrations or bank connections.
  • Basic Employee - this allows users to capture their time and expenses in FreshBooks, so you have the relevant information required to understand the overall picture of your business, and also keep up to date on project progress and share files. This option does not allow users to create or send invoices to clients, or view the financial information of your business.
  • Contractor - this allows contractors to only view information relating to the projects they are involved with. In particular, they can track time for projects, send you invoices, and also see their own dashboard, invoices, clients, expenses etc. relating to their own businesses. 

Whilst the levels of access have been set up to allow collaboration between users (both employees and contractors), for some businesses the depth of user permissions and lack of customization may be too simplistic.

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freshbooks limitations

Whilst FreshBooks is a great choice for most freelancers and a large number of small businesses, it does have some limitations (in addition to the few discussed in the sections above), which I've set out below:

  • No accounts payable application - if managing your payments to suppliers is a material part of your business, which you could save time on by automating or managing centrally (e.g. if you sell inventory), then FreshBooks may not be the right choice for you.
  • Not a double-entry accounting platform - making it unsuitable for businesses which need this level of financial management.
  • Not country specific - FreshBooks offers a country-agnostic platform, which may be a problem if your business has country-specific reporting needs.
  • Financial reports not accessible through the app 

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