The choice of which accounting software is the best (QuickBooks vs. Xero) is dependent on five major factors. Take, for instance, a multinational business that will likely use different accounting software than a law firm. That said, company size impacts how popular a certain accounting software solution is. More importantly, geography also plays a role.
QuickBooks vs Xero Analysis was carried out by GetApp
GetApp: Who are they?
GetApp offers software trends for small and midsize business (SMB) owners. Most readers and users of GetApp are based in the U.S.
QuickBooks and Xero are the best, most used, and most popular accounting software.
What are the best, most-used cloud-based accounting software apps that GetApp users see as popular among SMBs in other global markets?
To know which app is most used between QuickBooks and Xero, analysis was carried out with the data of GetApp users and LinkedIn-verified accounts on GetApp’s website and users who share the accounting software they use by switching the “I use this” tab to green on the GetApp website.
QuickBooks vs. Xero: Analytical Method
GetApp wanted to compare software buyers who indicated that they live in the U.S., Australia, Canada, or Great Britain. After the indication, they were segmented into four categories based on geography. Then, the number of times an accounting software app appeared and tallied the top five results per category was taken into account. The accounting apps with the most votes won each respective category.
GetApp Findings: QuickBooks vs. Xero
QuickBooks Online is the accounting software of choice for U.S.-based SMB owners; more than one in four uses it to balance the books. But this software is substantially less popular among SMB owners in Australia, Canada, and Great Britain. Xero has a stronger share in these respective markets.
QuickBooks: A Brief History
QuickBooks accounting software has a long history of market dominance. Intuit Founders Scott Cook and Tom Proulx saw success with Intuit’s Quicken product, a personal money management tool that aimed to capture the small business market as well.
Trained accountants were not their target users. Instead, Cook and Proulx marketed QuickBooks to small business owners with no accounting background. Their pitch worked—an Intuit press release from 2008 shared that QuickBooks accounted for 94.2 percent of retail units in the business accounting category.
However, it’s worth noting that this press release didn’t clarify whether it was discussing global market share or solely the U.S. Intuit didn’t release a UK-specific version of QuickBooks Online until 2011. Today, it offers country-specific products for SMB owners in Australia, Canada, and India. QuickBooks Online’s global version can also be customized by the user.
A 2014 buyer report from Software Advice found that QuickBooks maintained a strong market share. Their analysis revealed that 25 percent of small business accounting software users named QuickBooks as their tool of choice.
Xero: Global Usage
In Australia and Great Britain, QuickBooks Online came in a distant second. Xero dominated both of these markets; 59 percent of Australian and 44 percent of British SMB owners prefer it, respectively.
Even in Canada, where Xero came in third after FreshBooks and QuickBooks Online, 16 percent of Canadian SMB owners use Xero. Now, consider that the Canadian accounting software “winner” was actually a tie: 22 percent of SMB owners each reported using FreshBooks and QuickBooks Online. This means that there was no winner with a clear majority in Canada compared to the other three markets.
Why is Xero on such an upswing? It entered the cloud software market at the right time for a new target user. CEO Rod Drury is the person who founded Xero in New Zealand. He worked with his bookkeeper to build cloud-based software specifically for small business accounting. Xero’s inception as a cloud-based solution distinguishes it from QuickBooks, which evolved from a desktop product into the cloud-based QuickBooks Online.
Drury chose to focus on his home market first. Xero was founded in Wellington in 2006 and went public on the New Zealand Exchange just one year later, before it had expanded to any global markets or taken investment from Silicon Valley.
How to choose: QuickBooks vs. Xero
Balancing the books is a universal task. So, you’ll need accounting software no matter which corner of the world you live in. GetApp users prefer Xero and QuickBooks Online, according to the analysis they carried out.
GetApp can also be your number-one app comparison. Because it allows you to view each product’s features side-by-side. Which will help you learn if one is a better fit for your unique business size, a platform of choice (iOS vs. Android), price point, features, and more?
In addition, you can compare other products as well. Take, for instance, that you live in the UK and prefer to use accounting software that was built for British SMB owners. You can create comparison charts between two UK accounting software solutions, like SimpleBooks and FreeAgent.
Over to you!
The key to choosing the right accounting software is to be realistic about what you need upfront. Once you know how much you can spend, which operating system you plan to use, and which features matter most, you can start shopping for the best software solution.