Choosing the right accounting software for your company can be quite difficult. That’s especially true when two high-quality options come from the same company. How can you tell them apart? Is one actually better than the other? That’s the case with QuickBooks, which has been one of the more popular accounting platforms for years.
This situation has been fueling the QuickBooks Online vs Desktop debate over the past several years. Both versions have their benefits, although they could also have a few significant drawbacks. With how vital your company’s software functions are, choosing the best software for your company is vital.
Comparing these programs could be difficult, however, as many of us might not know how to do so effectively. That doesn’t mean that there aren’t some clear differences between the two. While both will perform better in certain areas, which one could be considered best might be based on your personal preference.
That being said, there are quite a few things that you might need to know before deciding.
QuickBooks Online Vs Desktop
Both QuickBooks versions have been produced by Intuit and are the company’s best-known products. While there are a few specific differences between the two, there are also a few up-front general details that you should know about.
For example, QuickBooks Online is cloud-based and has a monthly subscription pricing model. QuickBooks Desktop, on the other hand, has a license pricing model and is locally installed on your computer.
Before getting into the details, it’s worth having an overview look at both QuickBooks alternatives.
QuickBooks Online Overview
QuickBooks Online is one of Intuit’s flagship products and was launched in 2004. It was initially designed specifically for small businesses, although it’s subsequently been upgraded to provide much more scalability. That’s led to a significant number of medium to large firms using the software.
Over the past 17 years, multiple features have been added, including online payrolls and over 600 integrations. The invoicing system, among others, has also been upgraded and made much more attractive. There’s also the fact that, since QuickBooks Online is cloud-based, you can access your documents from anywhere you have an internet connection.
That should mean that you can manage your business on the go. However, it is one of the more expensive options, especially compared to its non-Intuit alternatives. Comparing specifically to the desktop, there are noticeably fewer features. That could give it less value for the money than QuickBooks Desktop.
· Over 600 online integrations.
· Cloud-based so it can be used on the go.
· Built-in lending system is quite easy to use.
· Many more features than you might see with competitors.
· Fewer features than its desktop counterpart.
· Much more expensive than some of its counterparts.
QuickBooks Desktop Overview
QuickBooks Desktop is one of the oldest accounting software products on the market. First released in 1992, it’s been upgraded and improved upon countless times since then. As a result, it’s gotten a significant number of new features, which has helped it stay one of the key players in the accounting world.
It’s worth noting, however, that there are actually three versions of QuickBooks Desktop; Pro, Premier, and Enterprise. While Pro is focused on small businesses, Premier is best suited for medium-sized firms, and Enterprise is more recommended for national or international companies.
Each of these offers a staggering number of features, such as an in-depth expense tracking and job costing platform. You can also take advantage of numerous integrations and advanced budgeting tools. Despite the advantages, it does have its drawbacks.
One of the more notable is that it’s a Windows-only release; Mac users can’t access it. That cuts out a significant number of people. There’s also the fact that its licensing pricing model is somewhat more expensive than its competitors.
Compared specifically to its QuickBooks Online counterpart, it has much less automation, which can often make many accounting functions much easier. That’s a feature that many people might want as it can make quite a difference. Expense tracking and other reporting mechanisms can also be better than the online version.
· Should be much more secure than many competitors.
· Over 200 automation integrations.
· Quite a few features to take advantage of.
· Should be much simpler to use than some competitors.
· As long as you have online access or internet access, you can access your documents.
· One of the more expensive options on the market.
· Windows only.
· No remote access.
A Detailed Comparison
One thing that you’ll need in any QuickBooks Online vs Desktop argument is a detailed comparison of them and their differences. As highlighted above, they can both shine in several broad areas. When it comes to accounting, though, it’s the details that count. That makes it worth getting into the nitty-gritty and seeing just how they compare.
QuickBooks Online and QuickBooks Desktop both offer quite a significant number of features compared to alternatives not developed by Intuit. While they share many of these, that doesn’t mean that they’re equal. Instead, Desktop’s features can often be much more developed and refined.
That’s especially true of the invoicing system. That makes it the much more comprehensive option. However, there are several features that are unique to QuickBooks Online. Namely, these are mobile apps, international invoicing and lending, alongside being able to access your documents on the go.
That means that many of these shared features are where most of your comparison should be. There can be quite a few drastic differences between them.
When it comes to accounting, QuickBooks Online and QuickBooks Desktop are quite similar. Both utilize double-entry accounting principles, alongside offering cash-basis and accrual accounting. How your information is presented also remains relatively similar.
For example, both offer detailed journal entries and charts, alongside accounts payable and receivable, and bank reconciliation. That should give you all of the fundamentals needed to run a business. However, QuickBooks Desktop offers more complex and comprehensive accounting.
One of the most significant differences between the two is what’s known as QuickBooks Live Bookkeeping. A service offered by Online, this is a service that connects you with certified public accountants and QuickBooks Online accountants when you need help. That could prove to be quite helpful for small business owners, especially around tax season.
Invoicing will take up a significant about of any small business owner’s time. Naturally, everyone would prefer if this was easier and took much less time. Thankfully, both QuickBooks options can help with that to different degrees. When it comes to the invoices themselves, though, QuickBooks Online definitely wins out.
That’s because you can make them much more personalized than you’d see elsewhere. Not only will these be attractively designed, but they’ll be clear and readable. Your customers should be able to understand them quite easily. QuickBooks Desktop’s invoices, on the other hand, can often look quite cluttered and busy.
That could be difficult for a customer to understand, which you’ll want to avoid. The longer it takes a customer to understand an invoice, the longer it will take them to pay. As a result, it’s much better to go with Online’s invoicing system. Hopefully, the Desktop version will get an upgrade at some point, however.
That isn’t the only way that QuickBooks Online beats out QuickBooks Desktop, though. It’s got several other automations that make invoicing easier. These include:
· Recurring Invoices;
· Batch Invoicing;
· Sending Invoice Reminders;
· Auto-Scheduling Invoices;
· Invoice Tracking;
· Invoice Translation, and;
· An Online Portal For Clients To Pay Through.
Naturally, these can be quite beneficial to the majority of small business owners, as it can cut down on the amount of time it takes to invoice your customers.
One of the main issues with invoicing numerous clients and other third parties is keeping track of your contacts. These are vital to your company’s operations, and you’ll need to keep an eye on them. With the sheer volume of contacts that your company will have, it’ll be almost impossible to do it alone.
Thankfully, both QuickBooks Desktop and Online offer an effective way of doing so. However, Desktop takes it to another level. That’s because it lets you track and manage leads alongside your contacts. That could make managing your sales and marketing figures much easier than it otherwise would have been.
Neither option offers a built-in payroll system as standard, which puts them on relatively equal footing. However, QuickBooks Online offers many more integrations than the Desktop version, one of which includes a payroll functionality. While this is high-quality, it does come at a price of $45 per month.
Desktop has a somewhat similar product, although this comes at a monthly price of $29. That should come as standard with QuickBooks Desktop Enterprise, however, under the built-in Enhanced Payroll system. That should mean that you’ll have everything you need in one platform, although this could come at quite a cost.
Given that these are optional upgrades, though, you don’t have to get them until you can afford them. That does mean, though, that you may have to do some things manually or pay for something else.
Quite a few industries need specific accounting features. That’s why it’s so difficult to find accounting software that’s perfect for everybody. While QuickBooks Online doesn’t offer this, it’s something that you can find on QuickBooks Desktop Premier and QuickBooks Desktop Enterprise.
Though these will come at a cost, they can be well worth it. Specifically, it can be beneficial if your company is a:
· Professional Services;
· General Contractor;
· Retailer, or;
· Manufacturing and wholesaling.
That should make operating your company much easier, which every business owner should strive for.
The pricing is one of the most significant differences between QuickBooks Pro and QuickBooks Desktop. That’s because they both have different pricing structures. Online has a typical SaaS pricing structure and comes at four prices ranging between $25 and $150. If you’re also using payroll, then that’s an additional $45.
QuickBooks Desktop, however, has a yearly licensing pricing model and three different prices. Pro starts at $299.95, while Premier starts at $499.95, and Enterprise starts at over $1,000. With the various differences between the two versions, it can often be difficult to say which one is better.
That’s especially confounding when you consider there are multiple versions of each. However, you’ll need to take your business’s needs into account, especially if you’re working on a tight budget.
As the different models are geared toward certain stages of growth, it’s highly recommended that you follow the beaten path.
Ease Of Use
You’ll naturally want your accounting software to be as easy to use as possible. After all, accurate accounting can be difficult enough by itself. However, there can be quite a wide gap in quality between many different options. While both options of QuickBooks are relatively high-quality, the Online version is much better.
That’s because QuickBooks Desktop can have quite a steep learning curve, which makes it quite difficult to navigate at the beginning. While this isn’t going to be an issue in the long term, it can be quite overwhelming when you first get started.
If you’re looking for things to be as easy as possible from the start, then QuickBooks Online might be the better choice for you.
Every small business will need financing at some point or another. However, this can often be difficult to obtain. That’s especially true if you’re trying to manage it across several platforms. That being said, there are relatively few high-quality platforms that you can use for business lending.
That is until QuickBooks Capital was announced. The initiative is primarily geared at small business owners who need some additional capital so that they can better manage their cash flow. These loans should be catered to your needs and should be relatively simple to apply for, as you’ll easily be able to supply all of the relevant financial information quickly.
However, this is only available for QuickBooks Online users.
Sales orders will matter to a significant number of businesses, although it wouldn’t be necessary for many. If yours needs them, though, then QuickBooks Desktop will be your only option, as they’re not included with QuickBooks Online. For the past while, there’s been talk of the feature coming to Online. So far, though, that hasn’t happened, and it doesn’t look likely to happen soon, so waiting may not be the best idea.
Keeping track of your income and outgoings will be vital to your operations. Naturally, that means that you’ll need reports on how well your financials are doing. Typically, you’ll want these to be as detailed and as actionable as possible. While both QuickBooks Online and QuickBooks Desktop offer reports, there are some critical differences between them.
For example, QuickBooks Online offers up to 80 reports. QuickBooks Desktop Pro, however, offers up to 130, and Premier and Enterprise offer much more. All of these include the basic information that you’d expect in your financial statements, including a profit and loss report, cash flow statement, and balance sheet.
QuickBooks Online & Desktop: Key Differences
You’re naturally wondering what the key differences between QuickBooks Online and QuickBooks Desktop are. While pricing will inevitably be one of the larger differences, there are a few that could be described relatively simply. These include:
· QuickBooks Desktop can only be accessed through your computer, while you can access your files on the go with QuickBooks Online.
· QuickBooks Online has quite a few integrations, while QuickBooks Desktop has more built-in features.
· QuickBooks Online can be quite easy to use from the start, while QuickBooks Desktop has quite a steep learning curve.
Naturally, a decent amount of time and effort will go into your choice of which one to choose. The above points offer only a snapshot of what either software can do for you, so it’s worth investigating and researching them further.
There’s also the issue of security. This is an aspect that some people may overlook, although it can be vital to your company. After all, your financial information is essential to your business and should be kept out of some peoples’ hands.
If you choose QuickBooks Online, then Intuit will take care of all of the security. That should be enough to put your mind at easy. Since Desktop is locally-installed, though, you’re solely responsible for security. While that means that there’s the potential to be much more secure, you still need to put effort into doing so.
As highlighted above, there can be quite a few differences between the two QuickBooks versions. While they both shine in specific areas, which one comes out best in the QuickBooks Online vs Desktop argument remains highly debatable. All companies will have their unique needs.
These can be addressed in various ways and with specific software. Naturally, these can be customized somewhat to meet your needs. However, certain products will already be more appropriate for getting your company’s finances looked after. Whether it’s QuickBooks Desktop or QuickBooks Online is in your hands.
It’s worth noting, though, that just because you’ve chosen one doesn’t mean that you can’t go with the other at some point. Trying one and then the other, while possibly expensive in the short term, could prove beneficial over time. This will let you test them out and figure out which one would be better for your needs.