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What are some painpoints of growing companies still operating on QuickBooks?
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I've come across several challenges over the years operating quickbooks in a growth environment
1. Data entry - Its data entry intensive which can a little painful with regards to billing depending on the number of clients you have and if you do not have a way to integrate your billing platform with Quickbooks. QB Pain Scale (1 to 10 with ten being the most painful) = 8
2. Payroll - I don't believe QB integrates well with many payroll reporting systems outside of uploading CSV files or manually inputting payroll data QB Pain Scale = 8
3. Revenue recognition - Quickbooks works well for companies where revenue is recognized when a product is sold or shipped. However Quickbooks does not handle "deferred" or "unbilled revenue" well. You will need to track these outside the system. QB Pain scale = 5
4. Receiving - while Quickbooks allows you to receive against Purchase Orders but does not offer an easy way to close out purchase orders that are under delivered other than "adjusting the quantity on hand" QB Pain Scale = 5
Quickbooks is a good system for a new business or business with less than 50 employees. Once you cross that threshold however, normal accounting processes take longer due to the volume of data that need to be entered into the system and the fact that most simple processes like billing can not be automated.
Thank you Ian, this is helpful!
What kind of "growing" are you thinking about?
I'm no fan of QB, but it works and many people start with it (or Simply).
And I've been involved in enough accounting system migrations to know one thing:
- Don't do it very often!
And the corollary
- If you're going to change, change when your smaller.
Consider the following when sizing an accounting system:
- How many transactions do you process each day (week/month)?
(income and expense combined)
less than one? 2 - 5 per day, or dozens each day?
get a system that allows data entry at that level, perhaps by multiple staff at once.
and QB has an upper limit for database size that isn't very big.
- How detailed is your revenue and expense tracking?
one income account? that's not even realistic!
3 to 6 income and 20 to 30 expense categories? QB works
12 or more income and 100 expense, QB is ok, but a real database is needed.
with department or project subcategories? QB won't go there easily.
- Will your accountant access the data occasionally?
Once a year and the QB "Accountants backup" works really well.
Once a month or more consider the QB online version or something else with remote access.
I agree with the previous 2 postings.
I think data entry issues related to QuickBooks can be particularly pressing. Oftentimes, QuickBooks customers have customer and revenue data in multiple systems, including QuickBooks for bookkeeping, Excel for managing inventory, fulfillment, and more complicated financial transactions, maybe a CRM system for sales, and perhaps another bolt-on Ecommerce web store. This leads to a lot of wasted employee productivity spent entering data from one system to another, time spent trying to tie reports from one data source to another, money spent trying to integrate some of these systems and to keep those integrations working through upgrades, and a general lack of visibility across an organization. All of this makes it harder for these businesses to scale efficiently as they grow.
Rob
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