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Finding new accounting software is not a weekend assignment. It takes weeks, if not months, of comprehensive research and assessment before you arrive at the right solution. Fortunately, there is a bright side to this arduous task because once you find the right accounting software, the entire business process becomes more streamlined.

The first thing to do when selecting and implementing new software is to get a good idea of what you need the software to do. Beyond maintaining current processes, you are likely looking for improvements, otherwise there isn’t much of a point in looking for new software. When looking for ways to improve efficiencies with new software, it is often helpful to look at something like a flowchart that will help identify ways to improve current processes. After identifying the areas that you would like to make improvements, you can begin looking for software that solves these problems. When looking for your solution, know that there are four segments for financial software, which are rougly defined below.

Software at the entry level is designed to work best with small businesses (those with 20 or fewer employees and less than $5 million in sales). Roughly 5 million companies in the US meet the profile for those that are best suited for software within this segment. This is the largest group of companies and is often the reason that accounting software guides exist – to help smaller businesses choose new software.

Small to Medium Business (SMB) software is designed to work best in applications of up to $100 million in sales and a maximum of 100 employees. Around 516,000 US companies can benefit from this software solution.

Small to Medium Enterprise (SME) software is different from SMB software, despite their similar names. SME software can handle up to 500 employees and up to $500 million in sales.

Enterprise Resource Planning (ERP) software is that which can accomodate well over 500 employees and billions of dollars in sales. The number of companies that fit in to this segment is fewer than any other segments, although some estimates are as high as 17,000.

However, it is important to take note that the categorization of these applications is not cut-and-dry. If you run a SME business but the ERP software is more suitable for your requirements, then you should get the ERP solution. Likewise, if your business operations are relatively simple despite the fact that you have $100 million in sales, you can drop down to one size.

Knowing your requirements will help you make the best decision. Generally speaking, accounts receivable software that falls in the higher-value segments is more expensive and comes with more capabilities. Keep in mind that you can save money by purchasing software without modules that you will not need, so do not rule out software that appears to fall in to one of the segments below your organization. Purchasing software with unnecessary features can actually cause the software to run slower, resulting in poorer performance.

On the other hand, software with inadequate functionality can also create problems. If you purchase software without a module that you need, you may be forced to use an outside application to run that process, which can cause headaches as well as present problems with compatibility that can add costs to the overall project.

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Author: Admin