FreshBooks vs Xero 2024 Comparison

One of the key expenses a business owner must keep track of is employee hours worked on a project. FreshBooks has specialized Time Tracking Software that integrates into FreshBooks so that your invoicing is quick and easy. It also helps business owners manage projects and clients so that they know how many hours are worked for any given task. Whether you are navigating from entering expenses to collecting payments, the sidebar is intuitive to use and doesn’t get lost in confusing jargon. Additionally, FreshBooks has a user-friendly mobile app that allows you to enter data as you need to while out of the office. This helps you from falling behind on entries when working away from your desk.

FreshBooks’ add-on marketplace doesn’t disappoint, even if it’s less expansive. They offer a few options for marketing (HubSpot, ActiveCampaign, MailChimp, Wufoo) and project management (Basecamp, Citrix Podio, Proposify) that you won’t find with Xero. For custom integration, you can use the FreshBooks API and webhooks to sync data with third-party applications. The ability to connect Xero to your bank account means you won’t have to move back and forth between two systems, entering and re-entering financial data. You can import and organize bank statements without leaving the software and reconcile statement lines with transactions in Xero. Another perk, Xero is one of the leading alternatives to Quickbooks.

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Business owners, on the other hand, how and when to file an extension on business taxes might not have the in-depth accounting knowledge needed to make Xero work for them. When choosing software vendors you need to prioritize the one that fits your business needs. Xero is an accounting software best suited to small businesses looking for high-level accounting systems.

How FreshBooks and Xero Stack Up

Cloud-based accounting software is relatively simple, so you don’t have to worry too much about piecing together a multi-module product what is framework suite like you might with ERP or marketing automation. Xero is a more popular name in this industry, and it’s the better choice if you deal with inventory. It has a more comprehensive set of features than FreshBooks, including financial reporting and analysis. Choose Xero if your specific accounting needs aren’t present in FreshBooks, such as more advanced A/P features. We went to user review websites to read first-hand reviews from actual software users. This user review score helps us give more credit to software products that deliver a consistent service to their customers.

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Viewing unbilled charges and time is possible on FreshBooks, but you can’t generate a report for it. When setting up a project estimate on both platforms, you have the option to add sales taxes, inventories, and labor. You can also compare cost estimates to actual costs, which is useful for contractors.

When comparing the reports generated by FreshBooks vs. Xero, I found Xero’s to consistently provide more detail and offer more flexibility with data presentation than FreshBooks’. FreshBooks brings some serious pizzazz and excitement to accounting, while Xero takes a more polished, business-like approach. Integrates with more than 100 third-party apps; limited choices for direct payroll and point-of-sale integrations. Intuitive, customizable invoicing capabilities compete with those of more robust accounting solutions.

1. This saves you from repetitive clicks by automatically identifying business names and common expenses.
2. Predictable costs without the need for add-ons or additional app integrations and transparent pricing that fits your budget.
3. Most are busy trying to find customers, explore new markets, and create sustainable strategies for growth.
4. If you’re looking for an accountant who specializes in Xero, you can search for an accounting advisor through their website by location and industry.
5. The left sidebar will help you navigate through payments, expenses and any other functions you need.

If a bank statement line meets the set of criteria you specified, Xero will suggest creating a matching transaction for you. Additionally, Xero’s customizable dashboard and global search function make the software easy to navigate. FreshBooks is a super-easy-to-use accounting software built specifically for small business owners, letting you easily do everything yourself. However, when it comes to using all the tools available to you as a small business owner, your accountant should definitely be part of your toolbox. You can import expenses from our expense tracker by uploading a CSV file as well as having FreshBooks automatically track them by connecting your bank accounts or credit cards. There are a number of payment processors and payment options you can choose through FreshBooks.

Due to its limited accounting features compared to Xero, FreshBooks doesn’t offer as many report options, and within its reports, customization is pretty sparse. That said, Xero makes up for its user-friendliness shortcomings through tutorial videos and a demo company feature. In Xero, you can view the platform as a demo company with pre-recorded data, which makes it far easier to see how the platform will look and operate when you input your own business’s data. Can support larger small businesses with dozens of employees; all three plans include an unlimited number of users. Feature set includes an excellent mobile app and suite of reports, capable invoicing features, plus inventory turnover calculating automated bill and receipt capture through Hubdoc.

FreshBooks is best for users needing a simple platform that they can use without a huge learning curve. QuickBooks is more comprehensive but also requires more training to maximize the use of features. As a company, FreshBooks is a little older — founded in 2003 — but doesn’t necessarily own a bigger share of the market.