Mailbag: Selecting a Small-Business Accounting App

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This week I respond to a reader who wants help selecting an accounting app for his small business.

Is there a ranking by sales of small-business accounting packages? Have you reviewed Sage BusinessVision? To be more specific, I'm looking for statistics and ratings of the following accounting packages: Microsoft Small Business Accounting packages versus Sage's Peachtree and BusinessVision.
--Bill Cooper, Stafford, Texas

It's usually accepted that Intuit's QuickBooks is the market leader in small-business accounting in the U.S., with Sage's Peachtree generally regarded as the runner up. Microsoft Office Small Business Accounting, which has been renamed Microsoft Office Accounting 2007, is a relative newcomer with a small market share.

Sage BusinessVision is a long-established product, though it has a relatively small market share in the U.S. and is more popular in other countries, such as Canada. I've looked at BusinessVision, though not recently. It's a solid performer for many small to mid-sized businesses.

But I haven't seen a public sales ranking of small-business accounting software that I'm confident is complete. Most sales listings cover selected sales channels, such as big-box retailers, which report to major market researchers. This doesn't give a picture of the entire market when it comes to small-business accounting. Many packages are sold through VARs (value-added resellers), consulting and accounting firms that do not report sales data. Some accounting apps are sold directly by the developers, either through a Web site or by mail order.

Some businesses use applications I believe are inappropriate for accounting since they lack proper controls. In one reader survey I developed, Microsoft Excel was tied for the most popular app to manage business accounts receivable and accounts payable.

Top Seller May Not Be Top Choice

Looking at a list of top-selling accounting apps will not guarantee you make a good choice. A best seller may not be best for your business. A more specialized accounting solution that sells just a few hundred copies a year through VARs may be the best fit for your requirements.

In some ways, top-selling accounting apps are like the winners of a high-school popularity contest. The most popular student wouldn't necessarily make the best spouse. Similarly, you need to do more research before marrying your business to an accounting app.

Analyze Your Business Needs

Many small-business managers find it difficult to determine which accounting software solution is right for their needs. Usually they go about viewing software demos and then analyze the available solutions.

If you start by looking at accounting apps and try to compare them to one another, it's very difficult to find the right solution. It's like trying to compare an apple to an orange and a banana. Which fruit is best?

You should start by defining your business needs. Consider the accounting capabilities that you require to meet those needs. Then compare the capabilities offered by the accounting solutions to your business needs. This way you're comparing all solutions to one standard: your business needs. The best accounting software solution for your business is the one that meets most or all of your needs.

Software Analysis

This software analysis compares the capabilities of apps to your business requirements.
This software analysis compares the capabilities of apps to your business requirements.
I've included a simplified software analysis that I use to illustrate a presentation on how to select accounting software.

You can perform your own software analysis by using a spreadsheet. List the accounting software capabilities your business needs in the first column. Use additional columns to rate the capabilities of each of the accounting solutions you're evaluating.

You can determine some software capabilities by researching information at the vendor's Web site. However, you may need to contact the vendor or attend a software demo to get all the details you require.

The software analysis is a handy way of organizing your evaluation process so you can concentrate on the capabilities that are important in your business. This analysis will lead to a better business solution than reviewing software sales rankings.

Richard Morochove is an IT consultant and writer. Send him questions about using technology in your small to mid-sized business via e-mail. PC World may edit your query and cannot guarantee that all questions will be answered.
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