March 1, 2023
3
MIN READ

Accounting SaaS Comparison: Xero vs Sage vs Quickbooks

Finance

Looking to replace your current accounting SaaS tool? In this post, we compare Xero vs Sage vs Quickbooks, exploring features, pricing, integrations & more.

by
Stephen Boachie-Mensah

Managing financial records is a nonnegotiable aspect of running a business. And it’s crucial for fast-growing scaleups.

But not all accounting SaaS tools are created alike. And the wrong option could make simple but important tasks overly complicated and highly fallible. So, if you’re rethinking your SaaS stack, your accounting tool may be the best place to start.

In today’s post, we’ll compare the three most popular accounting SaaS tools among Cledara users: 

  • Xero
  • Sage
  • Quickbooks

But first, let’s take a quick look at what we mean by “accounting SaaS” and how these tools make a difference.

Ready? Let’s get started.

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What Are Accounting SaaS Tools Really For?**

Essentially, accounting SaaS tools give finance teams a single platform to monitor financial indicators, produce insights, and generate reports.

In general, accounting software enables finance teams to:

  • Automate bookkeeping processes
  • Make basic invoicing and billing
  • Calculate taxes
  • Manage customers
  • Reconcile bank accounts
  • Track financial metrics
  • Aggregate financial data from CRMs, payroll automation software, and other platforms 

All in all, accounting SaaS tools optimize time and resources by:

  • Freeing finance teams from repetitive manual tasks
  • Centralizing financial information 
  • Automating financial reporting

The Impact of Accounting SaaS for CFOs**

Nowadays, CFOs sit on the frontline of company growth plans, using financial and operational data for corporate planning, expansion strategy, and fundraising. 

In fact, according to research conducted by PWC:

  • 47% of CFOs say their top priority is building predictive models and scenario analysis capabilities
  • 53% of CFOs say they plan to improve finance processes by using data analytics, AI, automation, and cloud solutions

With that in mind, cloud accounting software is an essential solution for CFOs because it allows them to:

  • Drive improved collaboration with accountants, bookkeepers, and colleagues
  • Avoid combing through manually compiled reports and spreadsheets
  • Get accurate insights to executives, investors, auditors, or tax authorities
  • Use real-time information to refine operations, purchasing, and hiring.

Plus, it’s fair to say that as your company begins to scale, it also attracts larger customers, investors - and regulators. So it’s imperative to have a bulletproof accounting system capable of scaling with you. This is exactly what accounting SaaS tools help CFOs to achieve.

Accounting SaaS Tools Comparison: Xero vs Sage vs Quickbooks 

Now that we've discussed what accounting SaaS tools do and why they matter, let’s compare three powerful accounting solutions. Our goal, in this section, is to help you pick which one’s best for you.

We’ll cover:

  • Xero
  • Sage
  • Quickbooks

Let’s dive in.

Xero Accounting Software

First up is Xero, a cloud-based accounting tool that helps businesses manage their finances in a simple and efficient way.

Xero was launched in 2006 in New Zealand and has since grown to become one of the most popular accounting software solutions globally, with over two million subscribers in more than 180 countries. 

Xero is designed for small businesses, accountants, and bookkeepers. 

With Xero, users can:

  • Operate internationally by transacting in over 160 currencies, get instant currency conversions, view rate changes, report in preferred currencies, and analyze how currency markets impact cash flow
  • Get a centralized view of their finances, track cash flow and monitor financial health
  • Match bank transactions, reconcile data with bank feeds and store documents online 
  • Create on-brand invoices and send them to customers via email or print payslips.
  • Track invoices’ payment status and send payment reminders.
  • Pay bills and file tax returns
  • Generate financial reports, including profit and loss, balance sheet, and cash flow statements.
  • See the big picture of a contact’s transaction history

Xero Pros

Xero is a favorite tool among businesses, thanks to:

  • Its 800+ software integrations, including market-leading tools such as Stripe, PayPal, Vend, Shopify, and GSuite.
  • Its cloud-based format.
  • Its clean, easy-to-use interface.
  • Its iOS and Android mobile apps.
  • Its detail-rich dashboard, which displays all relevant financial information at a glance.
  • The fact that it offers unlimited users support at no additional cost.
  • Its high security standard. With Xero, your data is securely stored on the cloud, and it’s protected by data encryption, two-step authentication, 24-hour monitoring, daily backups, and security audits.

Xero Cons

No tool is perfect. And Xero may just not be the right option for you. 

Consider that:

  • Some reviews suggest that Xero may not suit larger businesses and that it has limited financial planning and analysis capabilities (FP&A).
  • Claim expenses, track projects, and analytics come with an extra charge.
  • The most basic plan is limited. In fact, companies seeking to scale with Xero may find it insufficient. 

Xero Plans & Pricing

Xero offers a range of plans designed for businesses of different sizes, at different growth stages.

Xero’s plans are divided into:

  • Starter, which starts at $24/month and is ideal for sole traders, the self-employed and new businesses. 
  • Standard, starting at $40/month, which is great for growing small businesses and startups.
  • Premium, starting at $54/month, which is perfect for established businesses and scaleups.
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Sage Accounting Software

Sage Accounting helps finance teams to:

  • Create and track invoices
  • Monitor their cash flow
  • Automate repetitive tasks
  • Record revenue and expenses 

Moreover, Sage Accounting also supports bank feed integrations, covering hundreds of banks. Sage can help you to eliminate the need for manual data entry, as transactions are automatically imported into your Sage dashboard.

Sage Pros

Sage provides:

  • A generous starter plan.
  • Advanced features, such as solid inventory management and cash flow forecasting.
  • Unlimited transaction & account charts.
  • Telephone customer support for North America.
  • More than 165 different types of reports, depending on your plan.

Sage Cons

Some of Sage’s cons include:

  • The fact that it’s not nearly as advanced and user-friendly as some alternatives.
  • The lack of a few crucial features, such as receipt capture.
  • Extremely basic expense tracking. For instance, you can’t categorize expenses automatically.

Sage Plans & Pricing

Sage offers two plans:

  • Accounting Start, at $10/month. This plan includes entry-level accounting features, so it’s best for solopreneurs and micro-business  
  • Accounting Plan, at $25/month. This plan’s ideal for small businesses that require powerful cloud accounting software.

Moreover, as of this writing, you can get 3 months for free. No commitment, cancel at any time.

Quickbooks Accounting Software**

Intuit Quickbooks compiles all your business's financial information into easy-to-understand, manageable reports. A US-based market leader, Quickbooks is often referred to as the ideal solution for small-to-medium sized businesses. This is mostly thanks to its entry-level support and user-friendly features.

Quickbooks is an all-rounded accounting SaaS tool. 

With Quickbooks, you can:

  • Monitor income, expenditure & profitability. 
  • Track your inventory in real-time.
  • Sort income expenses into tax categories. 
  • Create and send customized invoices.
  • Control costs & get instant insights
  • Run and export comprehensive reports.
  • Capture & organize receipts.
  • Access accounting reports on-the-go, through the Quickbooks mobile app.
  • Accept credit cards anywhere.
  • Calculate taxes automatically.

Plus, Quickbooks integrates with more than 750 third-party solutions, such as Paypal, Square, and Shopify. 

Quickbooks Pros

Some of Quickbooks main advantages include:

  • Simple and intuitive interface with low learning curve
  • A robust feature set, even on the entry plan
  • Numerous tax forms, including W-2s, W-3s, and 1099s.
  • A wide variety of third-party app integrations.
  • Better customer support than their competitors, including Monday-Sunday phone support and live chat assistance in every plan.

Quickbooks Cons

Some of Quickbooks pros include:

  • The fact that each plan limits include a limited number of users 
  • A lack of industry-specific reports. 
  • The fact that users with multiple businesses must pay for separate subscriptions.
  • Lack of payroll automation features.

Quickbooks Plans & Pricing

Quickbooks offers three plans:

  • Simple Start, at $17 month, for up to 2 users
  • Essentials, at $26 month, for up to 4 users 
  • Plus, at $36 month, for up to 6 users

There’s a 30-day free trial on all Quickbooks plans. Moreover, as of this writing, they offer a 50% discount on your subscription’s first three months.

Our Verdict: Sage vs Quickbooks vs Xero**

There are many factors to consider when choosing an accounting tool, including:

  • Your SaaS budget
  • Your company’s team size
  • Your finance department’s goals
  • Your current finance stack
  • The type of product/service your scaleup provides

As you can see, Xero, Sage, and Quickbooks are all great tools worth trying. But, which one is the best fit for your business?

Here’s a brief comparison:

Xero is ideal for small and mid-size businesses and freelancers. This tool may be best for you if you’re operating in Australia and New Zealand since Xero adoption has been quite significant in these two markets. 

Additionally, Xero is a good choice if you need clear and intuitive software (even in mobile), with basic features at an affordable price. Yet, you’ll need to pay extra for add-ons such as claim expenses, tracking projects and analytics.

On the other hand, Quickbooks is trusted and well-known by accountants and bookkeepers across the United States. And its strong suit is compliance. It makes it very easy to follow State regulations and Federal Sales tax rules. 

Quickbooks is great for small to mid-sized businesses that want software with robust financial features and integrations. 

Meanwhile, Sage may have a steeper learning curve and a higher price tag. However, it’s the solution that many larger enterprises stick with, given:

  • Its ability to manage multiple business entities
  • Its broader capabilities around comprehensive reporting, HR, payroll, and payments

Combine Your Accounting SaaS With a SaaS Management Solution** 

In this post, we discussed the differences between Xero, Sage, and Quickbooks.

However, as your company grows, there’s one type of expense that usually grows with it. And it’s very likely to fall under your accounting tool’s radar. 

Adopting a SaaS subscription management platform can be a great way to control your SaaS spend. And here’s where Cledara can help.

With Cledara, you will:

  • Connect to your accounting systems, such as Xero or Quickbooks, and push your SaaS transactions and invoices automatically
  • Capture and reconcile invoices on autopilot
  • Get a centralized view of all your team’s software subscriptions
  • Discover hidden software costs
  • Manage SaaS platform access and seats effortlessly
  • Easily identify and unsubscribe from unnecessary SaaS tools
  • Make sure that everyone has access to the tools they need
  • Prevent shadow IT
  • And much more

Take control of your SaaS spending. Book a free demo and discover Cledara today.

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Stop wasting time tracking expenses and start making informed decisions.

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Stephen Boachie-Mensah

Stephen is Cledara’s in-house Finance Manager who thrives in businesses with fast-paced growth. Stephen’s role is to provide insights to the wider business, he has been heavily involved in cross-functional projects stretching across the introduction of global benefits, financial modelling and KPI reporting procedures. Outside of work, football and American football are his favourite pastimes.

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