One of the most challenging operations of any growing business is finding a robust and clear cashflow management platform. This is critical, for financial responsibilities cannot be looked at in retrospect in these modern times. On the contrary, revenue trends and profit margins must be constantly measured to adapt when necessary and to help identify any potentially profitable opportunities. So, it is no surprise that accounting software has now become the mainstay of many successful enterprises. However, questions will often arise as to whether online platforms or traditional desktop packages are the best choice. The truth of the matter is that the efficacy of these systems will depend largely upon the needs of the business. Each has its benefits and drawbacks, so it only makes sense to have a brief overview of some of the main metrics to consider before making an educated decision.
As smartphones and tablets have now become the mainstay of many business professionals, one of the benefits of online accounting software is that it can be accessed remotely. This is quite convenient for those who may not be present at the office for any predictable period of time. Unfortunately, desktop packages are static by their very nature and will therefore require the user to be physically present to gain access.
Obviously, any software that is supplied via an online service will normally automatically update itself when it is deemed necessary. This is important in reference to changing tax laws, exchange rates, new features and modern versions that may be more streamlined than their desktop counterparts. With the use of traditional accounting software, such updates will not take place automatically – though some may have a subscription for updates. Instead, they will have to be purchased as standalone platforms and manually installed much like any other software. Additionally, these upgrades will likely accrue an additional fee. For those who are not overly familiar with computers or software installations, this may prove challenging.
Scalability, Support and Security
One of the advantages of online accounting software is that it will frequently be based in the cloud; that is, changes can be made on-the-fly and whenever they may be necessary. This will result in little downtime and most upgrades (and even downgrades) can be accomplished in a matter of minutes. Similarly, the levels of support encountered with online software are by their very nature much more thorough than the support offered with a desktop service (client services are frequently included as part of a monthly fee in reference to online platforms). Should any problems arise, they will be addressed quickly and effectively. Although desktop alternatives will provide certain levels of customer support, they are frequently not as comprehensive or responsive. It should also be noted that due to advancements in security, both online and desktop platforms are considered to be quite immune from most external threats.
Presently, it may appear that the “scales” are tipped in the favour of online accounting software. However, we must finally address the critical areas of cost and ROI (return on investment). Should desktop software be desired, a on-off fee will be aid. After this initial financial outlay, the software is under the sole ownership of the user. As mentioned previously, additional upgrades will likely incur a further cost. However, it is essential to remember that online platforms are associated with monthly fees; some may be considerable. Over time, these monthly costs will far outstrip the one-off price of desktop software. In simpler terms, repeated installments may eventually lead to a much greater outlay of revenue than would ever occur with desktop accounting platforms.
Which is Better?
As mentioned in the beginning of this article, the perspective of which option is the better choice will revolve around the specific needs of a company. Obviously, online accounting software is more ideal for larger businesses that will require centralised, robust and scalable solutions that can be adjusted as is necessary. Still, there are other considerations to be made. If remote access is desired or if it is anticipated that this feature will be a realistic option in the near future, online providers will be the better choice. For those looking to streamline all accounting updates, the online versions are likewise desirable. However, a smaller business may still be able to use desktop software without the requirement for an online system. This is especially true if a business only serves a handful of customers and they are on a relatively tight budget (due to the potentially mounting costs of online programs). There are many times when a business will first employ the use of a robust desktop software service to ascertain if it will sufficiently cover the necessary accounting needs. Should their requirements grow, upgrading to a flexible and more comprehensive online platform of certainly feasible and may very well be the best option.