Have You Outgrown QuickBooks?

You’ve probably never thought that your business has much in common with a hermit crab looking for its next shell. If your rapidly growing business is constrained by QuickBooks and in need of better fitting software, however, the metaphor might be a good fit. QuickBooks is popular with small business owners for good reason, but it has limitations that become increasingly problematic as businesses grow in size and complexity.

Any accounting system should allow multiple employees to coordinate their activities and share information. Since QuickBooks is limited to a maximum of 5 users, your company will eventually need to decide whether to upgrade to QuickBooks Enterprise or migrating to a more robust system. QuickBooks Enterprise has the advantage of familiarity for experienced QuickBooks users, but it lacks many features commonly found in a full-fledged Enterprise Resource Planning system. Bear in mind that QuickBooks Enterprise is limited to 30 users, so this upgrade may not give a rapidly expanding company very much room to grow.

Is it time for ERP?

There are many reasons why implementing an ERP system may be the best choice for your business. Perhaps your company is taking on more complex projects, requiring communication between multiple stakeholders and rigorous accounting of time and costs. Maybe you recently acquired another company and want to maintain a comprehensive overview of multiple legal entities. An important new customer might promise nationwide sales and greatly increased revenue, but only if you are able to receive their purchase orders through Electronic Data Interchange (EDI). You may even face a unique business problem that can only be solved by creating a customized software solution. For any business, events like these are milestones to be celebrated and indicators that your organization is moving beyond QuickBooks.

Although the Enterprise version of QuickBooks may suitable for some smaller companies, compared with ERP it is not an adequate solution for businesses involved in manufacturing, warehousing, and distribution. QuickBooks Enterprise can be extended with additional modules, but this increases the licensing cost of the software ($1000/year for advanced inventory, for example). Hosting the software in the cloud will incur an additional charge of $40/user/month. Other features such as Electronic Data Interchange (EDI) communication are available only with third-party software. QuickBooks Enterprise also restricts EDI use to one user and a single trading party.

If you have built your business up to the point where QuickBooks is becoming a hindrance, celebrate the achievement and then think carefully about your requirements for your next system. A flexible, powerful ERP system should grow with you and support your operations far into the future.

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