What Do You Really Need: Cloud Accounting Software Or ERP Software?
When you’re on the hunt for software to help manage your business financials better, you really need to understand what exactly it is you are looking for.
While you may know that you want to turn to a cloud accounting provider, you may not know that every cloud software package is different. Some are closed and others are open.
In closed accounting software packages, the product vendor bundles everything they think you need into the one solution for you. Open cloud accounting on the other hand lets you tailor your solutions to exactly what you need.
A basic cloud accounting package will come with your standard tools such as:
- Accounts receivable
- Accounts payable
- Sales order
- Purchase order
- General ledger
- Timesheet tracking and reporting
- Expense management
- Receipt tracking and reporting
- Electronic payment processing
The above are your standard features from nearly all vendors. However, for others with open cloud accounting software, there’s also an inventory of add-ons or modules that are available. These can be developed either by the vendor or (as is often the case) by third party software developers. This is the case with Xero cloud accounting solutions, and it’s why they have such as extensive range of add-ons available. They work with software developers who create the add-ons to upload into the Xero marketplace, which extends the functionality of the cloud accounting software.
When you first start, you begin with cloud accounting. As your business grows though, you’ll find yourself needing more tools in your arsenal to help reduce the amount of time you spend not just managing your business financials, but your entire business as a whole.
You will eventually need to go from managing your financials to managing all the areas of your business with the potential to impact upon your financials, and preferably before they impact it too.
You can do that with…
ERP – Enterprise Resource Planning
This is taking your basic cloud accounting packages to another dimension. In essence, you’re taking a basic cloud accounting software package, and then by choosing the right add-ons that you need when you need them, you make your cloud solutions work more efficiently for and across your entire business.
The key difference between cloud accounting and ERP software is that with an ERP solution you have scalability.
It goes from monitoring and reporting to completely managing your business.
ERP software solutions give you all the basic functionality of cloud accounting software, in addition to tools that help you track and manage your…
- Human Resources
- Stock inventory levels
- The life cycle of your products
- Working hours
- key Performance Indicators (KPI)
(And pretty much anything else you need to manage your business more efficiently.)
And you can use it as a CRM (for Customer Relationship Management).
Instead of helping you just manage your financials, ERM goes beyond that to help you manage the areas of your business that impact on your financials.
By carefully managing the areas of your business that can impact on your bottom line, you can manage your business much more efficiently and proactively.
That’s why you are best to use an open cloud accounting software provider, because you can start with a basic package with everything you need, and then scale it as you need it to turn your accounting software into a customised ERP Software Solution to manage your entire business.
Xero does a grand job as an ERM, provided you know exactly what you need because the marketplace is huge. To help you get the best possible start with Xero, you are best to go with a partner who knows their way around the marketplace and the best solutions for the different types of businesses.
Whatever your business requires to help you manage your financials, our advisors will be able to help you get more from Xero by tailoring the solutions so you can make Xero a complete ERM solution for your business, rather than just the basic reporting tools.
Contact us here or by telephoning 01702 552008.