When it comes to managing your business finances, choosing the right accounting software is an important decision. Whether you're a startup founder, a small business owner, or managing a large business, comparing two of the most popular options of Xero vs Quickbooks is key to ensuring you make your businesses financial management more efficient and your life easier when it comes to your accounts.

In this guide, we’ll dive deep into the differences, similarities, features, pricing, support, usability and much more to help you make an informed decision to pick the right one for your business.

Key differences between Xero and Quickbooks

As you'd expect both of these companies have many of the same features so it's often preferably for us to look at the main differences to help you make a more informed choice.

• Xero has more focus on automation, a more user-friendly interface and more suited to businesses of all sizes
• Quickbooks has better support in terms of a phone line and 24/7 chat
• Xero will require a little more time to set up and get used to using it but is more powerful in our eyes
• Xero has more integrations with other software/apps, Quickbooks does have a comprehensive selection still
• Quickbooks has more advanced reporting although Xero have a large range of reporting options

Key similarities of Xero and Quickbooks

If you're comparing Xero vs Quickbooks then it will come as no surprise that they both offer a wide range of similar features and functionality, so if you the below core features that both share are all that you need then you'll likely be happy choosing either, so it may come down to the pricing, sign up offer or other factor such as interface that you prefer.

• Cloud-Based Platforms: Both offer fully cloud-based accounting solutions for easy access anywhere.
• Invoicing: Both allow users to create, send, and manage professional invoices.
• Bank Reconciliation: Automatic bank feed reconciliation is available in both tools.
• Multi-Currency Support: Both provide features for managing international transactions (in higher-tier plans).
• Expense Tracking: Both track expenses and categorize them for better financial management.
• Payroll Integration: Each integrates with payroll software or offers built-in payroll options in specific regions.
• Mobile Apps: Both provide mobile applications for on-the-go financial management.
• Third-Party Integrations: Compatible with a wide range of business tools and apps.
• Reporting Tools: Comprehensive financial and business performance reports are available on both platforms.
• Subscription Plans: Both offer tiered pricing models based on business needs and features.

Pricing and offers

Here we'll look at the current pricing for the plans available for users, this gives you an idea of the cost but remember to look into each plan on their website to see what they include.

Xero pricing: Plans are currently priced at $20, $47 and$80 per month.

Quickbooks pricing: Plans are currently priced at $35, $65, $99 or $235 a month.

Xero offer: 90% off for 6 months offer which is a market leading offer,

Quickbooks offer: up to 90% off for 7 months for UK customers and 50% off for 3 months for US customers.

As you can see, Xero is much more cost effective with lower cost plans and a better sign up offer, this may be the swaying factor for your choice but remember to weigh up all of the factors when selecting.

Pros and Cons of Xero and Quickbooks

As you'd expect each companies offering will have pros and some cons, the below gives you a brief overview of these as they will vary depending on your business.

Pros and Cons of Xero

Xero is a popular choice for businesses seeking a straightforward, cost-effective accounting solution with modern features. Its strengths and weaknesses are worth considering based on your business needs.

Pros

• Unlimited Users: All plans include unlimited user access, perfect for growing teams.
• Automation: Features like automated bank reconciliation and Hubdoc integration save time on manual data entry.
• Customizable Dashboard: Easily tailor the interface to display key metrics.
• Inventory Management: Basic inventory tracking is available across all plans, even the entry-level one.
• Wide Integration Options: Connects with over 1,000 third-party apps, ensuring flexibility.

Cons

• Limited Support Options: No live chat or phone support; assistance is email-based, which can be slower.
• Entry-Level Plan Restrictions: The Early plan allows only 20 invoices and 5 bills per month, limiting usability for active businesses.
• No Advanced Inventory Features: Unlike some competitors, Xero lacks capabilities like automatic reorder points.

Verdict

‍Xero is an excellent choice for those wanting to get the best software for their money, it's also fantastic for businesses that prioritize automation and scalability. However, its limited support and restrictions on the lower-tier plan may not suit businesses with more complex needs.

Pros and Cons of QuickBooks

QuickBooks Online is a feature-rich accounting tool that has earned its reputation as a leading choice for businesses of all sizes. Here’s what you should know about its strengths and weaknesses.

Pros

• User-Friendly Interface: Ideal for beginners with guided workflows and straightforward navigation.
• Robust Features: Includes advanced reporting, inventory management (on higher plans), and transaction tracking tags.
• Unlimited Invoicing: Send invoices to as many clients as needed, regardless of the plan.
• Extensive Integrations: Supports over 750 apps, including in-house bookkeeping services.
• Strong Customer Support: Offers 24/7 live chat and extended phone support hours.

Cons

• Higher Cost: More expensive than competitors, especially on advanced plans.
• User Limits: Plans cap user access, with the highest tier allowing only 25 users.
• Learning Curve for Advanced Features: Some users may find the abundance of tools overwhelming at first.

Verdict

‍QuickBooks Online is a powerful tool for businesses that need robust features and strong support. While its cost and user limits may deter some, its ease of use and versatility make it a top choice for those willing to invest in premium capabilities.

Xero vs Quickbooks - User Experience

When it comes to user interface, Xero is known for its clean, modern design that appeals to business owners who are new to accounting. Its dashboard is highly customizable, allowing users to tailor their view to highlight the metrics that matter most, such as cash flow, overdue invoices, or upcoming bills. Navigation is intuitive, with clearly labeled menus and streamlined workflows for tasks like invoicing or bank reconciliation. Xero’s sleek and minimalistic approach minimizes distractions, making it approachable for users who may feel overwhelmed by complex financial tools. However, the simplicity of its interface might require a brief learning curve for those unfamiliar with accounting processes.

On the other hand, QuickBooks Online offers a more traditional interface designed with usability in mind. It provides a straightforward experience for beginners, with step-by-step prompts and helpful tutorials to guide users through core functions like invoicing, expense tracking, and payroll. The platform emphasizes accessibility, with icons and categories that are easy to locate. While QuickBooks offers more advanced features than Xero, its interface can feel busier, particularly for those who don’t need its full suite of tools. For experienced users or those working closely with accountants, this detailed layout can be a benefit. However, first-time users might find QuickBooks slightly more overwhelming than Xero, especially if they are only looking to manage basic accounting tasks.

Why picking the right accounting software matters

Before we dive into specifics, let’s address why choosing the right accounting software is so important.

The right accounting software can help you:

• Save time by automating tasks.
• Keep accurate records.
• Get a clear financial picture to make smarter decisions.
• Stay compliant with local and international accounting standards.

While both Xero and QuickBooks offer these benefits, their approach and suitability vary depending on the size and complexity of your business.

We'll now give you a quick breakdown of each platform so you can quickly get an idea of what each offers and if it may be suitable for your business.

Xero overview

Xero is often the choice for many founders especially in the US, UK, Australia and other countries, it's cost effective pricing, great product and integration with other tools help make it a great choice for businesses.

Why founders choose Xero

Xero may not have quite the same name recognition as QuickBooks in the U.S specifically but in other countries it holds great weight as it is a global leader with a strong reputation for automation and scalability.

Key benefits include:

• Unlimited Users: All Xero plans allow unlimited users, a rare feature in accounting software.
• Automation First: Tools like bank reconciliation and Hubdoc integration save you hours of manual entry.
• Affordable Plans: With sign up offers such as the current 90% off for 6 months plus prices starting from just $15/month, Xero is much easier on your wallet than QuickBooks.
• Comprehensive Inventory Tracking: Even the most basic plan includes inventory management, unlike QuickBooks, which reserves this feature for higher-tier plans.
• Third-Party Integrations: Boasts over 1,000 app integrations, making it a flexible choice for diverse industries.

Pricing Plans

Xero’s pricing structure is straightforward and more affordable than QuickBooks:

• Early ($15/month): Designed for sole proprietors and freelancers but limits you to 20 invoices and 5 bills per month.
• Growing ($47/month): Removes the invoice and bill limits and adds more robust features.
• Established ($78/month): Includes project tracking and advanced reporting.

Xero often run discounts which you can get via using a Xero promo code to save money as a new customer when you sign up.

When Xero Stands Out

• You’re Growing Fast: If you need to grant accounting access to multiple team members, Xero’s unlimited-user feature is a significant advantage.
• You’re Cost-Conscious: The price difference between Xero and QuickBooks adds up quickly, especially if you’re scaling on a budget.
• You Need Basic Inventory Management: Xero includes inventory tracking across all plans, making it ideal for retail and e-commerce businesses.

Drawbacks to Consider

• Limited Customer Support: Xero lacks live chat or phone support, which might frustrate users who prefer hands-on assistance.
• Entry-Level Restrictions: The Early plan’s limitations on invoices and bills can be a deal-breaker for growing businesses.

QuickBooks Overview

A more widely known name in the US, Quickbooks is popular both in the states, as well as around the world including Europe, UK and many other companies, it has all the features you'd expect and is a solid option for many to opt for.

Why many founders opt for QuickBooks

QuickBooks Online is often the first name that comes up in conversations about accounting software—and for good reason. It’s been around for decades and has established itself as a reliable, feature-rich platform.

Here’s what makes it a strong contender:

• User-Friendly Design: It’s intuitive and easy to navigate, even for those with minimal accounting knowledge.
• Unlimited Invoicing: Send invoices to as many clients as you need, regardless of the plan you choose.
• Expense Management: Capture and match expenses to receipts directly from your phone.
• Extensive Integrations: With over 750 app integrations, QuickBooks Online can easily fit into your existing tech stack.
• Robust Reporting Tools: Access detailed financial reports to help you track your performance and make informed decisions.
• Stellar Customer Support: Includes 24/7 live chat and phone support during extended hours, giving you peace of mind when you run into issues.

Pricing Plans

QuickBooks Online’s pricing starts at $35/month for the Simple Start plan and goes up to $235/month for the Advanced plan. Here’s a breakdown:

• Simple Start ($35/month): Basic features like invoicing and expense tracking for a single user.
• Essentials ($65/month): Adds bill management and support for up to 3 users.
• Plus ($99/month): Includes inventory tracking and up to 5 users.
• Advanced ($235/month): Offers advanced reporting and allows up to 25 users.

Remember, if you're looking to sign up don't forget to use a Quickbooks discount when you do.

When QuickBooks Online Shines

• You Work with an Accountant: QuickBooks is widely used in the U.S., so chances are, your accountant is already familiar with it.
• You Need Scalability: While user limits might seem restrictive, the advanced features offered at higher tiers are designed for growing businesses.
• You Want Advanced Tracking: QuickBooks allows up to 40 tracking tags (or unlimited with the Advanced plan), making it easier to analyze your finances in depth.

Drawbacks to Consider

• Cost: QuickBooks is more expensive compared to Xero, especially as you move to higher-tier plans.
• User Limits: Even the Advanced plan caps users at 25, which might not be sufficient for large teams.

QuickBooks vs Xero - Support

Xero

Xero’s support options, while efficient, lack immediacy. The platform doesn’t offer a direct phone line or live chat; instead, users rely on email support and a callback system for assistance. While these methods work for non-urgent issues, they may frustrate businesses requiring quick resolutions.

However, Xero does provide a robust help center with guides, tutorials, and a community forum. This makes it suitable for users comfortable seeking answers independently or those who don’t anticipate frequent, urgent support needs.

QuickBooks

QuickBooks Online offers more comprehensive support options, including 24/7 live chat and extended phone support hours. This ensures businesses can access assistance whenever needed, making it ideal for those with time-sensitive inquiries.

Additionally, QuickBooks provides a detailed knowledge base and video tutorials, empowering users to resolve common issues on their own. For Advanced plan subscribers, priority customer support offers even faster response times, solidifying QuickBooks as a leader in customer service.

How to decide

1. What’s your budget?
   • If cost is a concern, Xero offers significant savings while still providing robust features.
2. How many users will need access?
   • QuickBooks caps users, so if you need broad access for a team, Xero’s unlimited users mean you can add as many users as you like.
3. Do you need strong customer support?
   • QuickBooks excels in this area, offering more hands-on support options than Xero.
4. How important is the automation side for you?
   • While both platforms offer automation, Xero’s focus on streamlining repetitive tasks is ideal for founders looking to save time.

Xero vs Quickbooks verdict

Both QuickBooks and Xero are excellent choices for managing your business finances, but they cater to different needs. QuickBooks is perfect for businesses that need robust features, strong customer support, and advanced tracking capabilities. Xero, on the other hand, shines for its affordability, automation, and scalability.

Still unsure? Take advantage of their free trials to explore each platform’s features before committing or Xero's 90% off for 6 months offer which is incredibly popular.

Remember, the right accounting software can simplify your finances and help you focus on what you do best: growing your business so it's well worth investing in.