Managing business finances with spreadsheets and shoeboxes full of receipts has become antiquated and risky in today‘s fast-paced market. SMBs face increasing competition, regulatory constraints and volatility requiring greater access to accurate financial data for decision making.
Yet only 56% of SMBs currently use dedicated accounting and finance software according to Digital.com. Of those without centralized visibility, 63% report cash flow issues directly tied to manually tracking income, expenses, inventory and other transactions across siloed systems.
Implementing a tailored financial management platform alleviates these operational bottlenecks. Beyond accounting, advanced systems centralize key processes from payroll to reporting to help SMBs:
- Cut finance staff labor by average of 75% via workflow automation
- Reduce reporting timelines by 8-10 days with centralized data visibility
- Improve forecasting accuracy up to 58% with AI/ML layered insights
- Boost average annual revenue by 17% within first year of deployment
As growth accelerates, manual accounting and spreadsheet budgets quickly spiral out of control. Financial software delivers control over cash flow and performance indicators needed to guide management decisions.
This guide examines the top 9 financial management systems for SMBs based on pricing, features, use cases and scalability potentials to fuel expansion.
Evaluating Financial Software Needs
With a sea of accounting platforms geared toward SMBs, identifying the optimal solution requires firms to carefully evaluate several factors aligned to current gaps and growth objectives:
Pinpoint Problem Areas
Conduct an audit of current financial workflows – where do gaps exist? Slow invoicing? Payroll errors? Inventory blindspots? Get stakeholder input across departments to quantify pain points then map software functionality needed to resolve them.
Analyze Must-Have Capabilities
Outline must-have modules to address immediate bottlenecks: accounts payable/receivable processes? Budget forecasting templates? Custom reporting builder? Defining core needs first enables finding best-fit systems to simplify daily financial operations.
Consider Future Scalability
While early-stage solutions may support current transaction volumes, ensure selected software can scale to accommodate more complex accounting needs, users and data ballooning over 12-24 months without heavy lifting.
Compare Implementation Plans
Vet provider onboarding plans, training programs and change management resources to ensure a smooth transition onto the new platform across your organization and key partners.
With priorities mapped to product functionality, buyers approach software evaluations better equipped to identify the right long-term platform partner beyond basic accounting needs alone.
Key Benefits of Financial Software for SMBs
Beyond core accounting tools, today‘s leading options incorporate related finance activities for end-to-end visibility and control including:
- Complex budgeting/forecasting beyond basic templates
- Cash flow optimization based on accounts receivable/payable prioritization
- Fixed asset depreciation with automatic schedules
- Advanced inventory costing, valuation and tracking
- Payroll/HRIS integration for unified data
- Tax planning and compliance automation
- Reporting and analytics for real-time business insights
Core platform connectors and add-ons further expand capabilities from:
- Processing billing and invoicing
- Managing purchase orders and vendor payments
- Building operational and financial data dashboards
- Enabling B2B customer self-service portals
- Supporting financial document management
Let‘s examine top benefits financial software brings to SMBs:
1. Flexible, Accurate Reporting
Data-driven insights inform strategic decisions from pricing adjustments to capital investments to hiring plans. Financial software centralizes accounting data for self-service reporting across any date range, location or business line without manual collation. Export custom views or push dynamic dashboards to stakeholder emails or portals on scheduled intervals.
By consolidating data in relatable reports, SMBs drive productivity and accountability across the organization.
2. Improved Forecasting Accuracy
Many systems incorporate statistical models and machine learning to generate cash flow projections, budget forecasts and operating scenarios tailored to your accounts. This leads to forecasts with greater than 85% accuracy in some cases over error-prone manual methods.
3. Faster Period Close Cycles
Consolidating general ledger, income statements, cash flow documents and balance sheets for monthly/quarterly/annual periods becomes streamlined versus chasing down inputs across siloed systems. Automation further eliminates redundancies so closure checklists that once took weeks now take days.
4. Painless Regulatory Compliance
Changing regulations around payroll, VAT reporting and fiscal year-ends prove challenging without software to apply updates across historical records. Systems manage new tax codes, payroll policies and other edicts behind the scenes while ensuring accurate filings.
5. Anywhere Mobile Access
Gone are the days where financial data and processes were confined to on-premise servers and desktop terminals. Cloud-based software centralizes access across devices while offline access ensures continuity when networks are interrupted.
Accounting platforms now grant businesses command of their fiscal health from anywhere needed to outmaneuver competitors.
Top Financial Management Software for SMBs
Transitioning from error-prone spreadsheets to scalable financial systems enables growing companies to drive efficiency, transparency and governance as the pace of business accelerates.
Here are 2023‘s top-rated options among small business owners based on price, core accounting scope, usability and unique specializations:
1. QuickBooks Online
Pricing: $15/month starter to $210+/month for premium tier
The cloud-based SMB accounting leader with 3+ million users worldwide, QuickBooks Online strikes optimal balance across robust feature set, intuitive interface, seamless operational software integrations and built-in reporting for anytime visibility into financial performance.
Standout Features:
- Automated categorization and matching
- Rules-based transaction workflows
- 150+ ecosystem app integrations
- Custom fields and entities
- Advanced access permissions controls
- Mobile optimization
Ideal For: Mainstream SMBs wanting a scalable, user-friendly accounting system with extensive app integration capabilities.
Pros
- Functionality parity between desktop vs online apps
- Approachable workflows and UX even for non-accountants
- Bank/credit card data connectivity automation
Cons
- Less specialized for niche industries over core offering
- Steep learning curve on advanced customizations
Best For: Mainstream SMBs wanting robust core financials and broad app connectivity.
2. Zoho Books
Pricing: Free to $30/month per user
Zoho Books earns high marks marrying accessibility with depth across accounting, billing, reporting and supporting finance modules. Operating under tech giant Zoho‘s umbrella gives access to hundreds of integrated apps.
Standout Features:
- 75+ ecosystem app integrations
- Multi-language support
- Document control and automated data capture
- Project milestones and billing
- Inventory and warehouse management
Ideal For: SMBs wanting financial data visibility and tools interconnected across sales, HR, marketing and other departments.
Pros:
- Strong uniform UX design across modules prevents relearning
- Auto-categorization of imported transactions
- Custom field creation flexible to different entities
Cons:
- Less customized report templates than larger platforms by default
- Support response times mixed for lowest tier packs
Best For: SMBs heavily invested in integrated Zoho business solutions suite.
3. FreshBooks
Pricing: $15/month basic to $50/month plus premium tiers
Dominant billing and invoicing brand for service SMBs also offering complete accounting toolset from expenses to payments to reporting.
Standout Features:
- Client portal for online invoice delivery/payments
- Auto data capture from emails and documents
- Milestone billing for project teams
- Advanced account aging analyses
Ideal For: Project/services driven firms needing integrated systems to get paid faster.
Pros:
- Very simple to create, customize, send client invoices
- Tight payroll integration for unified data
- Tracking employee expenses and reimbursements
Cons:
- Expense management capability more lightweight
- Getting set up has learning curve for extensive customization
Best For: Services SMBs invoicing clients and managing payroll in unified platform.
4. Wave
Pricing: 100% free base software
Delivering unlimited accounting essentials 100% free forever, Wave monetizes value-added software modules like payroll, payments, lending and tax preparation that integrate at market rates.
Standout Features:
- Full income/expense tracking
- Invoicing capabilities even on free tier
- Bank/credit card data connectivity
- APIs for custom integrations
- Sales tax calculations
Ideal For: Solo entrepreneurs and microbusiness owners needing to graduate from Excel to dedicated platform without cost barrier.
Pros:
- Generous free tier includes unlimited accounting features
- Manages basic accounting workflows beyond spreadsheets
- Growing ecosystem of vertically integrated add-ons
Cons:
- Very lightweight, scaled down reporting lacking customization
- Must pay or build integrations for advanced functions
Best For: Pre-funding startups needing basic accounting tool off the ground.
5. Sage Accounting
Pricing: $10/month starter for core financials to $75/month enterprise tier
Sage Intacct manages complex multi-entity accounting needs with connectors across Sage‘s HR, payroll, BI solutions while recent rebranding aims for mainstream SMB appeal on interface and pricing.
Standout Features:
- Multi-company consolidation
- Global tax engines
- Fixed asset lifecycle tracking
- Custom entities and objects
Ideal For: Larger or fast scaling SMBs needing complex, automated accounting system natively tied to other business solutions.
Pros:
- Handling of multi-location finance processes and reporting
- Granular access controls across books, departments and data sets
Cons:
- Overbuilt capabilities for most basic SMB accounting needs
- Deployment complexities with heavy customization
Best For: Mid-market and enterprise trajectory SMBs needing automation, security and granular accounting from platform purpose built for complexity.
6. Xero
Pricing: Four tiers from $12/month to $60/month
Xero makes robust accounting accessible for growing ecommerce and manufacturing SMBs tracking inventory, purchasing and sales reconciliations while leveraging thousands of platform apps for greater insights.
Standout Features:
- Handles partial inventory receipts
- Landed cost allocation
- Matrix reporting by variables
- Auto bank/credit card import
- 1,000+ platform integrations
Ideal For: Wholesale, retail, inventory-driven SMBs requiring connectivity across sales channels and suppliers.
Pros:
- Advanced inventory costing, reporting and controls
- Automated transaction categorization
- Bank feed centralization
Cons:
- Less tailored for industries not moving product
- App integration costs add up
Best For: Product-based SMBs needing accounting visibility integrated with inventory and sales.
7. ZipBooks
Pricing: 100% free financial software
Easy-adopt online accounting solution offers impressive depth even on forever-free tier for core accounting, unlimited contacts and basic reporting needs.
Standout Features:
- Mobile-first interface
- Integrations with Paypal, Stripe, Square payments
- Basic invoicing
- Reporting templates
Ideal For: Sole proprietors and very small teams needing simple, free financial tracking.
Pros:
- Generous freemium offer useful for early stage
- Super simple getting started for non-accountants
- Payments ecosystem connectivity
Cons:
- Very simple reporting lacking customization
- Must integrate other systems for complex accounting
Best For: Pre-funding startups and microbusiness owners needing basic money oversight and tracking for free.
8. Kashoo
Pricing: $20/month starter to $65/month top tier
Specialized financial software meeting retail and inventory-based SMB vertical needs managing purchasing workflows alongside sales reconciliations central to their operations.
Standout Features:
- Purchase order management
- Landed cost tracking
- Inventory matrix reporting
- Batch sale/purchase data import
Ideal For: Retail, ecommerce, wholesale and manufacturing SMBs needing deep inventory accounting integration.
Pros:
- Tight inventory accounting controls from PO to sale
- Multi-channel sales data aggregation
- Complex costing analysis and reporting
Cons:
- Niche focus limits appeal across industries
- Less flexible for service businesses
Best For: Inventory-driven SMBs needing integrated procurement, sales and accounting.
9. SlickPie
Pricing: $19/month unlimited tier
Online financial software explicitly designed for simplicity getting SMB bookkeeping started then connecting other platforms to scale up capabilities as complexities arise.
Standout Features:
- Multi-language support
- Multi-currency handling
- Paypal integration
- Email invoice delivery
Ideal For: Small business owners wanting basic DIY accounting solution to offload from Excel sheets without committing to enterprise platform out the gates.
Pros:
- Super simple interface for non-accounting users
- Generous pricing tiers to start
- Integration ability into other platforms
Cons:
- Very lightweight reporting lacking customization
- Must build connectors to elevate complexity over time
Best For: Early stage low-complexity SMBs needing simple DIY accounting foundations before scaling into heavier solution.
The Bottom Line
Transitioning to dedicated financial software represents a turning point for SMBs to graduate from disjointed Excel sheets and manual processes into scalable systems delivering greater accuracy, efficiency and insights leveraging automation.
While core accounting represents just the start, today‘s leading platforms tackle the entire spectrum of financial operations from predicting future performance to optimizing cash flow allocation day-to-day. This unified command of fiscal health allows management to base strategic decisions on real-time data vs best guesses – an invaluable advantage as business complexity accelerates.
With Over 86% of SMB leaders believing more data-driven decisions would lead to growth, solutions like QuickBooks Online, Zoho and Xero matched to specific operational needs make enterprise-grade financial control finally accessible. The key lies in aligning top platforms to highest priority gaps, growth trajectories and willingness to integrate across existing infrastructure.
By implementing the right financial solution and committing resources to smooth adoption, SMBs gain the power to scale while removing resource-draining barriers holding back goals.
