Accounting Software

No matter the size of your gift business, a good accounting software package can enhance the efficiency of bookkeeping procedures for your store. Current accounting software facilitates all key accounting functions, from general ledger, accounts receivable, and accounts payable to payroll, inventory, order entry, job costing, and systems management.

But finding the right software system for your business is critical. Today, most systems are actually quite affordable, so cost shouldn't be a major issue, even for smaller businesses. However, vital components such as systems capability, customization, training, support, and ease-of-use will determine which application is most suitable for your needs. And making the wrong decision could be detrimental to your business.

"Selecting the wrong accounting software can be a complete disaster," explains Carlton Collins, CPA, a partner with K2 Enterprises in Atlanta.

How can you avoid selecting the wrong software? Here are five key steps to take in selecting the right accounting software for your gift business.

While it's possible to spend $1 million or more on an accounting software package, most small gift businesses can run on packages that cost less than $1,000 to install. Yet even in that price range, there are plenty of software packages from which to choose, so take your time in choosing. Learn about all of the available options. Talk to other retailers and your CPA for guidance in your decision-making process. Make a list of all the products that might meet your needs. As you become familiar with the different features of each software option, you should begin to eliminate poor choices.

One of the best resources for information on accounting software is the K2 Enterprises Web site, www.k2e.com, which brings a wealth of data together in one location. "At K2 Enterprises, we personally visit accounting software vendors each year at enormous costs of time and resources," says Collins, who is also editor of Accounting Software News. "We read piles of press releases, magazine articles, and other reviews."

After identifying all the viable options, the next step is to compare the list of features provided by each package with the needs of your business. One resource available to help you evaluate the different programs is The Accounting Library, a software program that sorts through 1,750 potential accounting features and matches the features you need with potential accounting packages. The program, which costs $295, is available by calling (316) 665-3611.

To learn more about the features of the various software programs, you can also visit vendors' Internet sites and print out all the relevant information. Then, contact each vendor and ask for brochures and other collateral materials to be sent to you. Many vendors will also provide a copy of the software with sample worksheets and charts for your evaluation.

As you evaluate the features of each software solution, Collins advises that you ask the following questions:

• Does the software provide customization tools?
• Is the vendor financially sound and reliable, and can it provide the technical resources my organization will need?
• Can the product deliver the type of financial reports I require?
• Will the underlying technology meet my current and future needs?
• Is the product's account-number structure suitable for my business?
• Since e-business has become so important, does the package provide Web integration?
• Can it handle foreign currency?
• Is it easy to use?
• How much does it cost?

Working with a reputable, well-established reseller is key. The reseller can help you make your choice based on the specific needs of your business. The reseller should also have demos of various software programs. However, if you're considering software from more than one vendor, you may need to see more than one reseller.

"Identify the best reseller in your area for the products you are considering, and arrange for them to demonstrate their products to you," advises Collins. "They should be able to do this in about two to four hours, and they should take time up front to ask you extensive questions about your company and your needs."

You should be aware that the meeting with the reseller will be a sales pitch, but it also provides you an opportunity to ask questions. During the demonstration you should inquire about their available time, their installation methodology, and their track record for getting systems up and running properly on time. You should also ask the reseller for at least three references.

Another important reason to find a good reseller is the installation and training process. Having someone on hand to sit down and teach you how to use the software will save you weeks of getting acclimated to the system.

Before making a final decision, it's important to check references. Get feedback from other retailers using the same software. Additionally, the reseller's references should be called. If you run a small gift business, ask the reseller to provide other small retail business users as references.

Collins says there are six key questions to ask when checking references:

• Do you use "x" software?
• When did you install it?
• Who performed the installation (company and name of reseller)?
• Did they do a good job and install the system on time?
• Are you satisfied with the product?
• What problems have you had with the product?

If you have special accounting needs in your gift business, don't forget to take them into consideration when choosing your accounting software. For example, if you export or import, make sure the package will accommodate these transactions. If your overseas business requires invoices or other correspondence in another language, that will also limit your choices.

Other special needs might include electronic banking, multiple locations, payroll, and e-commerce options. Whatever your unique needs are, don't ignore them when selecting a software solution.

Remember, take your time when you are choosing an accounting software solution. Making the right choice should significantly improve the efficiency of your gift business by giving you more accurate and timely financial information and by giving you more time to spend on your trade.

According to Carlton Collins of K2 Enterprises, there are over 300 "legitimate" accounting software solutions and a few hundred "wannabes." The K2 Enterprises Web site ranks the top accounting software programs for businesses of varying sizes. The top five low-end accounting software solutions (for companies with up to $5 million in annual revenue) consists of the following packages. (Prices include the eight core modules of general ledger, accounts receivable, accounts payable, payroll, inventory, order entry, job costing, and system manager.)

• BusinessWorks. (Best Software; $3,675 single user, $5,165 five users) Cited as having the highest level of customer/CPA satisfaction of any of the low-end priced products followed by K2 Enterprises, BusinessWorks is excellent for inventory-heavy businesses with multiple locations. The package also can be purchased by module.
• M.Y.O.B. Accounting Plus. (M.Y.O.B. Software; $299 single user, $625 five users) Particularly popular around the world for its Goods and Services Tax (GST) and Value Added Taxes (VAT) capabilities. Features include Easy Setup Wizard, industry specific chart of accounts selections, and flow charts to help navigate the system.
• Peachtree Complete Accounting. (Peachtree Software/Best Software; $270 single user, $600 five users) Collins cites Peachtree as "arguably the best value in all of accounting software." Includes 13 modules and has a very effective inventory accounting component as well as unique e-commerce features.
• QuickBooks Pro. (Intuit; $280 single user, $949 five users) The number one selling accounting software package in the world, with over 2 million customers. While QuickBooks is the most effective solution for general cash flow and monthly financial statements, it has a limited capability for inventory management.
• One Write Plus. (Peachtree Software/Best Software; $70 single user; $350 five users) Like QuickBooks, an easy-to-use, inexpensive accounting software solution. However, it has limitations with inventory management. Best suited for a small business with little inventory.