As a small business owner, freelancer or solopreneur, managing your finances is a crucial part of running a successful and profitable operation. While you may have gotten by with simple spreadsheets or shoeboxes full of receipts when you were just starting out, growing your business requires leveling up to more robust accounting software.
Two of the most popular cloud-based accounting solutions on the market today are QuickBooks and FreshBooks. Both offer a range of features to help you track income and expenses, send invoices, manage cash flow, and prepare for tax time. But each platform also has its own strengths, weaknesses and ideal use cases.
So how do you decide between QuickBooks vs FreshBooks for your business accounting needs? In this in-depth comparison, we‘ll break down everything you need to know to make an informed decision, including:
- An overview of each software and who it‘s best for
- A head-to-head comparison of key features
- Pricing and value for the money
- Ease of use and customer support
- Pros and cons of each platform
- Our recommendation of which to choose in different scenarios
Whether you‘re just launching your business, upgrading from a more basic bookkeeping method, or considering switching providers, this guide will help you determine which accounting software is the right fit for your needs and budget. Let‘s dive in!
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QuickBooks Overview
First released in the early 1990s as a traditional on-premise desktop software, QuickBooks has evolved over the decades to become the market leader in accounting solutions for small to medium size businesses. In 2001, Intuit launched QuickBooks Online, a cloud-based version that has seen strong growth in recent years. Today, over 4.5 million subscribers worldwide use QuickBooks Online.
So what makes QuickBooks so popular? The platform is known for its comprehensive accounting features, wide range of integrations, and scalability for growing businesses. It‘s an especially good fit for companies that sell products and manage inventory, thanks to its inventory tracking capabilities.
QuickBooks‘ key features include:
- Full double-entry bookkeeping and accounting (general ledger, chart of accounts, bank reconciliation, etc.)
- Customizable invoices and estimates with online payment options
- Expense categorization and receipt capture
- Sales tax calculation and reporting
- Inventory management
- Reporting and dashboards
- Payroll (with higher-tier plans)
- 650+ integrations with business apps (point-of-sale, e-commerce, CRM, etc.)
One potential downside of QuickBooks is that it can come with a bit of a learning curve, especially for those who are new to accounting software. The interface is not always the most intuitive, and some users complain about the level of customer support for the online version.
However, QuickBooks‘ rich functionality and reporting make it a top choice for business owners who want in-depth insight into their finances and need a platform that will grow with them over time. It‘s also a favorite among accountants and bookkeepers, making it easier to collaborate with your financial partners.
FreshBooks Overview
Founded in 2003 as a simple online invoicing tool, FreshBooks has grown into a full-fledged accounting solution geared mainly toward freelancers, solopreneurs, and very small businesses. It now has over 24 million users in 160 countries.
FreshBooks‘ main selling point is its ease of use. The software is designed with simplicity in mind, using a more visual interface and accessible language that doesn‘t require deep accounting knowledge. This makes it ideal for self-employed professionals and new business owners who want to quickly get a handle on their finances without having to decipher too much accounting jargon.
FreshBooks‘ key features include:
- Simplified bookkeeping (client records, expense tracking, double-entry accounting reports)
- Unlimited customizable invoices that are easy to create and send
- Time tracking and project management
- Expense receipts capture
- Estimates and proposals
- Simplified reports
- Payments (credit card, ACH)
- 200+ integrations with business apps
One big advantage of FreshBooks is its robust mobile app, which allows users to accomplish most key tasks on the go, from sending invoices to capturing expense receipts to tracking time spent on projects. For service-based businesses that are often out in the field, this mobility is a major asset.
However, one notable absence in FreshBooks‘ feature set is native inventory management. The platform also has more limited reporting compared to QuickBooks. Businesses with more complex needs may find they quickly outgrow FreshBooks.
QuickBooks vs FreshBooks: Feature Comparison
Now that we‘ve given an overview of each platform on its own, let‘s see how QuickBooks and FreshBooks stack up against each other in terms of specific features:
Accounting
Both QuickBooks and FreshBooks offer double-entry bookkeeping and the essential reports needed to understand your business‘ financial health, including profit and loss, balance sheet, and cash flow statements. However, QuickBooks‘ accounting functionality is significantly more developed.
With QuickBooks, you can do bank reconciliation, create journal entries, generate statements of retained earnings, and produce dozens of other reports that go into deeper detail on your finances. The software automatically categorizes your transactions and lets you run reports by time period, location, customer, and more.
FreshBooks offers more simplified accounting geared towards users without an accounting background. You can connect and categorize your bank and credit card transactions, but the level of detail and flexibility in the reporting is more limited.
Winner: QuickBooks
Invoicing
Creating and sending invoices is a core feature of both FreshBooks and QuickBooks. Each allows you to customize your invoice template with your business logo and colors, set up recurring invoices, and enable online payments for your customers. You can also send payment reminders automatically when invoices are overdue.
One area where FreshBooks shines over QuickBooks is its proposals feature. If you frequently need to send estimates or bids to clients, FreshBooks makes it easy to create professional-looking proposal templates that you can convert into projects and invoices if won.
Winner: FreshBooks
Expense Tracking
With both FreshBooks and QuickBooks, you can connect your bank and credit card accounts to automatically import and categorize your expenses. Each also has a mobile app that lets you snap photos of receipts and records them as expenses on the go.
Where QuickBooks has an edge is in its ability to set custom expense rules. For example, if there‘s a certain coffee shop you frequent for business meetings, you can create a rule to always categorize transactions from that merchant as "Meals and Entertainment." This saves time and improves the accuracy of your expense tracking.
Winner: QuickBooks
Time Tracking
If you bill clients by the hour or need to track time for payroll, both FreshBooks and QuickBooks offer built-in time tracking tools. However, this is an area where FreshBooks outperforms QuickBooks.
With FreshBooks, time tracking is included with all plans at no extra cost. You can track time by client, project, or task using a built-in timer. Your time tracked automatically syncs to your invoicing, so you can quickly bill clients for recorded hours.
In contrast, QuickBooks only offers time tracking when you pay an additional fee for an add-on called QuickBooks Time (formerly TSheets). This means an extra expense and requires toggling between different interfaces. It‘s also mainly intended for tracking employee time for payroll, rather than tracking billable hours for clients.
Winner: FreshBooks
Reporting
QuickBooks is the clear winner when it comes to reporting. As the more robust accounting solution, it offers significantly more reports and customization options than FreshBooks.
With QuickBooks, you can run over 100 reports sorted by metrics like customer, vendor, time period, product or service, location, and more. You can also merge data from multiple company files, modify and memorize custom reports, and schedule them to be automatically generated and emailed to you.
FreshBooks keeps reporting much more basic, with just a handful of preset templates such as profit and loss, sales tax summary, accounts aging, expense report, and time entry details. While these cover the essentials, businesses that want granular insights and flexibility will find QuickBooks more suitable.
Winner: QuickBooks
Ease of Use
Usability is one area where FreshBooks has the advantage over QuickBooks. Designed with simplicity as a core principle, FreshBooks offers a clean and intuitive interface that‘s easy to navigate even if you have zero accounting experience.
Setting up your FreshBooks account is quick and straightforward, with prompts to guide you through connecting accounts, setting up taxes, and personalizing your invoice template. There‘s also less accounting jargon throughout.
While QuickBooks is relatively user-friendly compared to traditional desktop accounting software, it does have more of a learning curve. The setup process is a bit more involved, and the sheer depth of features can be overwhelming to new users.
FreshBooks also has the edge in mobile use. While both have iOS and Android apps, FreshBooks‘ mobile experience is more fully featured, allowing you to accomplish most accounting tasks on the go.
Winner: FreshBooks
Customer Support
Both QuickBooks and FreshBooks offer multiple support channels, including phone support, live chat, email, online knowledge base, and video tutorials. However, FreshBooks is known for more prompt and helpful customer service.
FreshBooks has phone support available 8am-8pm ET, Monday through Friday. Users generally report short wait times and friendly, knowledgeable agents. The FreshBooks website also has an extensive library of support articles and guides written in easy-to-understand language.
QuickBooks offers phone and live chat support Monday through Friday, but many users complain of long wait times. For the online version, most technical support communication is done via live chat or email rather than over the phone. QuickBooks‘ online knowledge base is comprehensive, but some may find the articles overly technical.
Winner: FreshBooks
QuickBooks vs FreshBooks: Pricing
QuickBooks and FreshBooks each offer several different pricing plans to fit the needs of various business sizes. Here‘s a quick breakdown of each:
QuickBooks Online Pricing
- Simple Start: $25/month for a single user
- Essentials: $40/month for up to 3 users
- Plus: $70/month for up to 5 users
- Advanced: $150/month for up to 25 users
FreshBooks Pricing
- Lite: $15/month for up to 5 clients
- Plus: $25/month for up to 50 clients
- Premium: $50/month for up to 500 clients
- Select: Custom pricing for over 500 clients
One important thing to note is that FreshBooks‘ plans are based on the number of active clients you can invoice per month, while QuickBooks‘ plans are based on the number of individual users who can access the account.
In terms of value for the money, which software comes out ahead will depend on the specific needs of your business. If you have very simple accounting needs and a limited number of clients, FreshBooks‘ lower-priced plans may be sufficient. But if you need more advanced features like inventory management and granular reporting, you‘ll likely need to spring for one of QuickBooks‘ pricier plans.
Also keep in mind that payroll is an add-on cost for both platforms, starting at $45/month plus $4 per employee for QuickBooks and $39/month plus $6 per employee for FreshBooks.
QuickBooks vs FreshBooks: Pros and Cons
To help summarize the key strengths and limitations of each platform, here‘s a quick overview of the main pros and cons of QuickBooks vs FreshBooks:
QuickBooks Pros
- Comprehensive accounting and reporting features
- Scalable for growing businesses
- Inventory management
- Large ecosystem of 600+ integrations
- Preferred by accounting professionals
QuickBooks Cons
- Higher learning curve than FreshBooks
- More expensive for most businesses
- Inconsistent customer support
- Clunky mobile app compared to FreshBooks
FreshBooks Pros
- Extremely user-friendly and easy to learn
- Excellent customer support
- Strong mobile accounting capabilities
- Proposals and client retainers
- Competitive pricing for businesses with simpler needs
FreshBooks Cons
- Limited reporting compared to QuickBooks
- No inventory tracking
- Charges per active client can be restrictive
- Fewer integrations than QuickBooks
- Not as suitable for businesses with complex finances
The Bottom Line: Which Is Better for Your Business?
Choosing between QuickBooks vs FreshBooks ultimately comes down to understanding the specific needs of your business. To help guide your decision, here are our general recommendations for when to use each platform:
You Should Use QuickBooks If:
- You have a product-based business that needs inventory tracking
- You require advanced accounting features and reporting
- You plan to grant account access to multiple users, such as an in-house bookkeeper or accountant
- You need the flexibility to scale as your business grows and your finances become more complex
You Should Use FreshBooks If:
- You‘re a freelancer, solopreneur, or very small business with straightforward accounting needs
- You have no prior accounting experience and want the simplest solution to learn and use
- You do most of your accounting and invoicing on the go and need strong mobile capabilities
- You frequently create estimates and proposals for clients
While both QuickBooks and FreshBooks are powerful tools for managing your business finances, each caters to a distinct audience. By assessing your business structure, accounting experience, and plans for growth, you can determine which software is the optimal solution for keeping your financial processes running smoothly.
Whichever you choose, investing in cloud accounting software is a big step towards more organized, accurate, and insightful financial management. With the right software on your side, you can save time on bookkeeping, get paid faster, and make more informed decisions to drive profitability and growth.