As the end of the year grows closer, you may be worrying about closing the accounting year and how to utilize the information in the multiple spreadsheets you are currently using. You may be wondering- is there is a better way to manage the payables, receivables, payroll, and day to day accounting activities?
It may be time for an upgrade, but what should you upgrade to? And should it be in the Cloud or at your business? What are the major factors that you should consider when thinking about upgrading your accounting software?
Here are 3 Major Points of Consideration:
1.) On-Premise or Cloud?
You must decide whether to bring in a software system that you install at your business or hosted in an outside environment. If you install it on-site, you need to consider:
- You will have up-front fees for hardware and software
- You will need an IT staff to maintain
- You will need IT to ensure the security of your data
- You are responsible for updating and upgrading your licenses every year
- You can only access your data from your building
Installing on-site may bring a sense of comfort because your data is in house. Additionally, your monthly subscription may be lower since you paid a hefty amount of up-front costs.
If you choose a cloud environment to move your accounting software to:
- You won’t need an IT staff or a server room for your building since it is off-site
- The Cloud ensures security 24/7
- You can access your data from anywhere since everything is online (phone, tablet, PC, etc.)
- You may have up-front fees, but they are usually less than on-premise since you are having your data hosted in an outside environment
- You won’t have to pay for the hardware, maintenance, upgrades, etc. up front
2. What is my Lowest Cost of Ownership?
Lowest Cost of Ownership (LCO) simply means: What will my lowest cost be for the software in the long term? You should also be considering what you believe the LCO, will be to your business while evaluating software vendors for your QuickBooks migration. This will help you determine which companies fit in your company’s budget for your new accounting system.
Things to consider as you determine what your LCO is and means for your business:
- 1 time payments or monthly payments *Any company moving away from QuickBooks will usually have to adjust from paying 1 time for their QB software, to paying more upfront for setup/implementation fees & licensing
- You will need to consider support for the application, which is usually an added cost to what you have already agreed to:
- Up-front Capital Expenses (usually the biggest inhibitor to a company moving off QuickBook) *There are software companies that have no up-front costs because they spread out all of those costs among a multi-year contract (3-5 years), and they should be considered as well
These are all very real costs to migrating to a more robust application and should be considered thoroughly.
3. When Should I Have the New ERP (Accounting) Software Installed?
Most companies like to install their new system in Q4 or Q1 of their fiscal year. This ensures an easier transition of data with much less down time. You can, however, still implement a new system at any time throughout the year. It depends most on the needs of your team and business.
To ensure a successful transition, here a few more points to consider:
- Make sure you save time for your staff to help give information to the consultants as they install the system
- Detail the specific functions that your business will need, or use, every day -the consultants will need this information as they begin the transition
- Set aside time to train your team before the system goes live - you want everyone to be comfortable before the actual rollout date!
For more information on financial accounting software provided by SMB Suite, please visit www.smbsuite.com.