Xero Review 2018 | Key Things to Know Before You Start
Last updated on February 11, 2018 09:00 EST
Xero is my accounting software choice for small and medium businesses. It's easy of use, and offers a scalable solution for your business, great value for money, and the full suite of features that almost all businesses will require. Hence making it the most robust accounting software solution in the market right now.
xero REVIEW IN BRIEF - xero TOP PROS AND CONS
Top Xero Pros
Most scalable accounting software solution
The Premium version has no limits on the number of users and clients, unlike most of the other providers, and offers the widest range of features. Hence you can rest assured that you won't run up to any road blocks as your business grows in size (and possibly complexity).
Wide range of integrations
Xero is compatible with over 500 applications, meaning that it shouldn't be difficult to find solutions that can help customize Xero further to your business needs.
Strong mobile app
The mobile app offers excellent functionality.
Top Xero Cons
Setup can be time consuming
Implementation can be tricky and cause some headaches, but its important to get this right at the outset to enjoy the benefits of Xero later on! Do make use of the excellent customer service as you're setting up, or alternatively it may be useful to hire an experienced professional to help you set it up.
Missing the ability to track billable hours
This is the only flaw I've managed to find in Xero's range of features. As a result, Xero likely isn't the best solution for freelancers, or very small businesses that charge clients on a time basis. That being said, most small and medium-sized businesses shouldn't use this as a reason not to get Xero - installing an app should do the trick (last time I looked there were 24 choices available)!
Features for the "Starter" offering could be better
The Starter package ($9 per month), which is the cheapest option, only allows you to send 5 invoices and quotes, enter 5 bills, and reconcile 20 bank transactions. These limits are likely to be too restrictive for most businesses - if so, the next tier ("Standard") does not have restrictions for any of these items, but costing $30 per month, is quite a step up in price!
xero pricing review
Xero offers main different levels of pricing / packages - Starter, Standard and Premium. Unlike competitors, all tiers offer an unlimited number of contacts / clients and users, which is great if you work with a large number of clients or need to give a large number of employees access to the accounting system. The main difference as you move up the tiers is that the range of features increases. Xero offers a 30 day free trial (no credit card required).
Starter - this tier is very restrictive in its limits, making it ineffective for a large number of users. In particular, during each month, you can only send 5 invoices and quotes, enter 5 bills, and reconcile 20 bank transactions. In addition, payroll and multi-currency are not supported.
Standard - unlike the Starter option, there are no restrictions on sending invoices and quotes, entering bills and reconciling bank transactions. Payroll is supported but multi-currency is not - hence this will only likely be the best solution if you conduct your business in a single currency.
Premium - this is the full bells and whistles version of Xero, incorporating the features of Standard, with additional payroll capacity and multi-currency support.
Signing up to a month-to-month payment plan will costs $9 per month for Starter, $30 per month for Standard. and from $70 per month for Premium. There are 3 Premium options available, all with the same features, but supporting a different number of employees for payroll. Premium 10 ($70 per month), Premium 20 ($90 per month) and Premium 100 ($180 per month) support payroll employees of 10, 20 and 100, respectively.
The pricing of the Standard and Premium options may seem to appear more expensive than the competitors, but bear in mind that these include Payroll, which is usually an expensive add-on and not provided as a standard module by almost all competitors.
xero ease of use
Xero's user interface is well designed and simple to navigate. Rather than presenting the various options available via a navigation margin on the left (like competitors), Xero has them set out as tabs across top.
The Dashboard shows an updated snapshot of the key financial metrics, including bank balances, total cashflow, invoices owed by you, bills due and expense claims. It is customizable, allowing you to reorder the charts, or even hide the ones that are not relevant to you.
The level of detail available, range of reports and ability to customize the main reports all contribute to reporting being a key strength of Xero. Available reports include:
- Financial - Balance Sheet, Budget Manager, Cash Summary, Income Statement, Movements in Equity, Balance Sheet, Budget Summary, Budget Variance, Business Performance, Executive Summary, Statement of Cash Flows - Direct Method, Statement of Owners' Equity, Tracking Summary.
- Sales - Aged Receivables, Aged Receivables Detail, Customer Invoice Report, Aged Receivables Summary, Income by Contact, Receivable Invoice Detail, Receivable Invoice Summary.
- Purchases - Aged Payables, Aged Payables Detail, Billable Expenses - Outstanding, Supplier Invoice Report, Aged Payables Summary, Expense Claim Detail, Expenses by Contact, Payable Invoice Detail, Payable Invoice Summary.
- Inventory - Inventory Item Summary, Inventory Items Summary, Sales By Item, Inventory Item Details, Inventory Item List.
- Tax - 1099 Report, Sales Tax Report.
- Accounting - Account Transactions, Bank Reconciliation Summary, Contact Transactions - Summary, New
Foreign Currency Gains and Losses, General Ledger, Journal Report, Trial Balance, Account Summary, Account Transactions, Bank Summary, Detailed Account Transactions.
- Fixed Assets - Depreciation Schedule, Fixed Asset Reconciliation, Depreciation Schedule, Disposal Schedule.
- Payroll - Payroll Activity Details, Payroll Activity Summary, Payroll Employee Summary, Taxable Wage Summary, Time Off Balances, Time Off Transactions, Employee Contact Details, Employee Remuneration, Pay History Details
Pay History Summary, Time Off Requests, Timesheet Details, Timesheet Summary, Total Cost Details, Total Cost Summary, Transaction Listing Details, Transaction Listing Summary.
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