6 Best Accounting Software For Online Businesses (2024)

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Online Businesses usually start small. They make their money through using websites or social media platforms and generally account for their businesses manually, either through spreadsheets or fundamental accounting solutions.

Accounting software benefits online business owners by allowing them to monitor accounts receivable and payable, gain a clear understanding of their performance, and plan for tax season. A small online store usually uses simple software without substantial tweaks.

When an online business expands, the accounting requirements become more complicated, necessitating using a custom enterprise resource planning (ERP) framework. Accounting software for small online companies comes in various flavors, each with its own set of features and price tag.

In general, the industry sector and the number of staff are two considerations that can aid a small business owner to select suitable accounting software. You really cannot afford to lose sight of the company’s finances. Fortunately, there are various accounting software tools available to help you organize expenses, bill customers, and keep track of your finances. Of course, with so many online business accounting software choices, deciding which to use can be difficult.

Luckily for you, we’ve compiled a list of the best accounting software for online businesses.

Features To Look For in a Good Accounting Software For Online Business

Accounting software is among the first business software you would acquire when starting a company. The best accounting software allows you to build invoices, track incoming and outgoing payments, recognize and track past-due receivables, and generate reports to evaluate your company’s financial health and other facets.

In the beginning, when you start your online store, you generally have very low requirements for an accounting solution. Since you have a low number of employees and not many sales, you can easily account for them manually or using simple accounting software.

But as your online business grows, you might have to get add-ons to your existing accounting solution to make it more suited to your company’s needs. There are certain things that the best accounting software for an online business will offer you.

Reports Of Your Business Performance

The best accounting software for an online business should give you a quick summary of your online business.

When you sign in to the account of your accounting software, you should be able to see a dashboard with a summary of your account operation and leading indicators like cash flow, profit and loss, account balances, expenditures, accounts payable and receivable, and sales. You can rearrange the details in specific accounting systems to configure what you see first.

Link with Bank Account

Your accounting software should be able to link the app to your business bank and credit card accounts, allowing you to receive regular transaction updates. You can save time because you will not have to submit transactions manually. It also offers you a regular, rather than a weekly, account rundown. Reconciliation can be made easier with a real-time bank-feed feature, making it a simple job rather than a monthly ordeal.

Invoice Features

If your company sends invoices, being able to email them and accept online payments will help you get paid more quickly. Some accounting systems work with third-party online payment processors, while others force you to use their inbuilt payment processing. Accounting software that can also act as an invoice creator is a bonus.

You can use this function to have the device create and submit invoices for recurring charges, including subscriptions, automatically. You may specify how many invoices are sent – regular, weekly, monthly, or annually – as well as whether the billing has an endpoint.

Financial Reports

Any accounting software can produce financial reports. However, some are more simple than others, and some enable you to upgrade to a more expensive plan in order to access advanced reporting. If you want particular types of financial reporting, check to see if they are included in the program and plan you choose. Detailed reports will aid in the interpretation of financial data so that you can formulate a strategy and make informed decisions.

Integrations

The best accounting software for online businesses can be integrated with online selling platforms such as websites. Since you would not have to manually move data from one system to another, the ability to link your accounting software to other business programs helps you save time.

Payroll, payment processing, point-of-sale systems, and CRM software are just a few of the common forms of accounting software integrations. Integration of existing programs reduces preparation time for workers who will be using the program.

Inventory Management

Lastly, your accounting software should be able to give you advanced inventory management features to help you keep track of your inventory and account for it.

1. Bonsai – Best For Meeting All Requirements Of Online Businesses

Bonsai checks all the boxes when it comes to meeting the needs of all online businesses. It allows you to manage your accounts with ease by using features such as invoicing for accurately charging clients. You can also make payments on time by understanding which ones are due at a specific time.

This platform also has an intuitive interface that will give you an edge over your competitors. Preparing your books for tax periods will be fast with the estimates and deductibles that this software offers.

Your books will also be error-free if you integrate Bonsai with other apps. So you will never have to worry about legal trouble.

Features

Clean Dashboard: The software has a great dashboard that keeps all features in one place and allows you to view them in no time. There will also be no clutter on the screen due to the different categories for each feature. Viewing your active tasks will also be a breeze with this intuitive dashboard.

Connect Credit Cards: Bonsai is great for following up with different transactions because you connect multiple credit cards to the software. This means you can follow each payment and ensure all money is accounted for. Linking your card to the app will also not take more than a few seconds.

Schedule Meetings: Running an online business may seem difficult because you will have to do meetings online. Bonsai helps with this by helping you schedule appointments using its robust feature. You can get client information and offer them a meeting slot without calling them.

Track Expenses: Understanding your expenses will be a breeze with this software due to different categories. The platform separates your expenses into reimbursed and non-reimbursed payments. It will also offer an accurate figure for the total expenses.

2. QuickBooks Online

When it comes to online business accounting, QuickBooks ticks all the requirement boxes. Being one of the most intuitive and easy-to-use accounting software gives it an edge over other accounting software. It is popular because of the multitude of features it provides.

Easy to Use

Online businesses all over the world use this highly intuitive accounting program. Accounting professionals are eager to support the software for its low cost, ease of use, and performance.

Features

It’s difficult to find many weaknesses in QuickBooks, particularly given the needs of today’s online businesses. Some of its features are below:

Integration: QuickBooks Online is a feature-rich accounting platform that integrates with a wide range of business applications and is reasonably priced. Bill.com, Salesforce, and HubSpot are a few of the typical business applications that QuickBooks Online integrates with.

Bank links: To follow up on their transactions, many companies find it beneficial to link their credit card processing company to their accounting software.

Cloud-Based: The fact that the program is cloud-based and upgraded regularly appeals to all of us.

Standard features: QuickBooks Online provides standard features like invoicing, billing, and receipt scanning—and even the most basic package includes more robust monitoring than many competitors. You can generate professional invoices, accept payments, monitor expenses, and keep a close eye on your cash flow with this software.

Financial Statements: QuickBooks’ built-in statements, including the trial balance, general ledger, and 1099 transaction detail reports you’ll need at tax season, will spare you the burden of creating financial statements manually.

3. Xero

In our study, Xero is the best choice for online businesses looking for fundamental accounting software. Many companies begin small, but this does not always remain the case. You need accounting software that can scale your business, and Xero does just that.

Xero gets high marks for its extensive features and low entry price. Send custom invoices, consolidate bank transfers to balance the books, collect receipts for easier bookkeeping, and monitor inventory for only $11 per month. Xero indeed classifies as one of the best accounting software for online businesses.

Features

Integration: This program has a straightforward user interface and completely integrates with a third-party payroll provider. Via Xero’s integration with Stripe and GoCardless, businesses can accept payments from customers online. The software supports more than 700 app integrations.

Unlimited Users: Xero’s plans all offer unlimited users at no additional cost. Delegating tasks like bank reconciliation or cost monitoring to another team member is included in your price, so you don’t have to pay extra.

Standard features: The majority of functionality, such as forecasts, inventory monitoring, and recurring invoicing, are included in all plans.,

Customer Support: Xero also includes email and live chat support 24 hours a day, seven days a week.

Reports: Over 50 reports, including profit and loss statements and a general ledger, are available in Xero. Reports can be customized, viewed as maps, date ranges searched, and other filters applied.

Inventory management: Xero also gives you fantastic inventory management tools.

Project management: Sign up for the established plan to get access to Xero’s project management tools.

Mobile Application: Xero has its own mobile application so that you can keep track of your online business’s performance on the go.

4. FreshBooks

FreshBooks has established itself as a reliable and easy-to-use accounting platform for online businesses. It is popular mainly because of its fantastic invoicing capabilities. It isn’t easy to find a platform that gives outstanding invoicing coupled with excellent accounting, but FreshBooks gives you both. That is why it ended up on our list of the best accounting software for online businesses.

In comparison to other accounting tools, FreshBooks allows for more invoicing flexibility. Its primary purpose is to transmit, collect, print, and pay invoices, but it can also handle simple accounting for a company. Service-based companies may use this accounting software to submit a proposal and invoices, request deposits, obtain client retainers, monitor project time, and receive payments.

Features

Easy-to-Use: The layout is simple to use, and you can apply billable time and expenditures, customize the invoice’s appearance and set recurring invoices, automated payment notifications, all in a few simple steps.

Bank linking: This accounting platform links to your bank account, produces various reports, keeps track of time, and assists you in project management.

Invoicing: FreshBooks also allows you to offer clients the option of paying bills by invoices, which expedites the payment process.

Alerts And reminders: FreshBooks allows you to alert late-paying clients by sending them reminders and warnings when payments are due or past due. You can even keep a record of how much time you spend on tasks and take pictures of receipts to record them on the go.

Integration: FreshBooks integrates with popular business software and web applications to optimize processes, save time, and get a better picture of how your business performs.

5. Oracle NetSuite

NetSuite is an accounting and ERP system designed for companies with much more advanced requirements. It has more features as compared to others on the list and is an ERP program as well. 

Oracle’s NetSuite is an excellent alternative for online business owners who want a clear overview of their operations when automating accounting functions. You can handle all facets of your enterprise with this app from a single dashboard. It is yet another one of the best accounting software for online businesses.

NetSuite may not be suitable for you if you’re a sole proprietor or a small online business with simple needs. On the other hand, NetSuite deserves close scrutiny if you need a more comprehensive approach to accounting and want to be able to make more informed financial management decisions.

Features

Standard tools: You can send and receive payments, generate a variety of reports, and keep track of your taxes.

Automation: NetSuite has adopted automation, making it simple to submit invoices and collect payments, and it offers comprehensive tax processing software that supports all currencies and exchange rates.

Revenue recognition management: A revenue recognition management solution is also available, which assists company owners in meeting accounting requirements and reporting financial reports on time.

Cash flow management: The CFM is also easy thanks to a comprehensive collection of features that provide cash flow analysis.

Payment management: The payment management system in NetSuite centralizes payments, while the planning and budgeting features combine data to aid planning.

Oracle NetSuite offers so much more than the features mentioned, so explore them if your online business has complex needs.

6. Zoho Books

Zoho Books includes all of the essential features for online businesses and more enhanced tools, including project billing and time tracking. It also has integrations, allowing you to use the app as your company expands. Because of its simplicity and value, we chose Zoho Books as the best accounting software for online businesses.

Features

Mobile App: the mobile app of ZohoBooks makes invoicing and bookkeeping very simple and easy.

Easy-to-Use: ZohoBooks is easy to use, but that doesn’t mean it compromises essential features. In fact, it includes everything you could need in accounting software.

Automation: its automation features like automatic payments, recurring invoices, automated reporting, and scheduling helps you save time so you can focus on growing your online business.

Integration: CRM applications, email campaigns, and digital marketing solutions, spreadsheet editors, and other collaboration resources are all available via Zoho’s own range of integrated enterprise applications. For added ease, Zoho Books integrates with third-party productivity software and business solutions.

Conclusion

Managing your finances is critical to your company’s success, and the right accounting software will make things a lot simpler. There are several advantages of using accounting software instead of notepad or an Excel spreadsheet.

The above 6 are the best accounting software for online businesses and will help your business in a multitude of ways.