Xero Vs Quickbooks

Xero Vs Quickbooks

Within the world of small business accounting applications, a big battle is shaping up between two of the dominant players: Xero vs Quickbooks. For years, Quickbooks, in both its desktop and online versions, has been the “800-pound gorilla” of small business accounting software packages. It’s easy to understand why: it’s powerful, robust, very adaptable, is supported by a large community of professionals, and is affordable. Of course, “Quickbooks” (like McDonald’s for hamburgers or Wal-Mart for retailers) is the first brand that comes to mind when any business owner starts to shop for accounting software.

However, Xero is beginning to give Quickbooks a run for its money. As you can see in the graph above, Xero has increased its global subscriber base by 900% in the five year period between mid-2012 and the first quarter of 2017. Xero is gaining subscribers at a much faster rate than Quickbooks Online; in fact, it is the more popular package in many countries outside of the U.S. In 2012, Xero was being used by only 100,000 businesses. In March of 2017, however, the upstart accounting application reached a milestone: Xero reached the one million subscriber mark! No small feat, and the growth is just beginning. By contrast, Quickbooks Online had a subscriber base of 360,000 businesses in 2012. In the early part of 2017, there are now 1,870,000 businesses using Quickbooks’ cloud-based software. Indeed, while more businesses use QB; consider the well-known application’s rate of growth. QB Online boasts a rather impressive 419% growth in subscribers during the same five-year period noted above. However – that growth rate is less than half of Xero’s growth rate.

As a small business owner and advisor for many years, I have my own take on the Xero vs Quickbooks rivalry. I believe Xero is a superior small business accounting package that is easier to learn and now has a large support network within the U.S. Xero also offers more flexible reporting, a large and growing family of add-on applications, unparalleled security, and a cleaner, more streamlined interface. In addition, Xero was built from the ground up as a cloud-based accounting solution, while Quickbooks began life as a desktop solution which has now morphed into its present online-based form.

If your business isn’t using accounting software now, it’s time to think long-term. Whether Xero vs Quickbooks Online, the choice is yours. Whichever accounting application you choose, the longer you delay choosing an accounting system, the more problems and lost opportunities your business will realize. It’s better to get your books in order sooner rather than later. Whether you decide to take on the bookkeeping tasks yourself or hire a part-time bookkeeper to help, your bottom line will be vastly improved down the road.

Xero SubscribersQB Subscribers
2012: 100,000
2013: 155,000
2014: 280,000
2015: 500,000
2016: 717,000
2017: 1 million
2012: 360,000
2013: 490,000
2014: 740,000
2015: 1,000,000
2016: 1.5 million
2017: 1.87 million

Sources: annual reports from Xero, Intuit

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