Xero Review: Best Small Business Accounting Software (May 2017)

Xero Reviews

Current Xero Promotion: Customers based in the U.S. are eligible to receive 30% off their first 6 months of any subscription level: Use discount code XERO30NOW when you sign up or click here.

The Best of the Best

Can you agree with me when I say that a small business can’t be run effectively without quality small business accounting software? Thankfully there are many options on the market that take care of your small business accounting needs. However, choosing the best small business software to do your small business accounting with can be an overwhelming task. When searching for the right software to meet your business needs, you have many things to consider. This includes cost, amount of features, and ease of use. The last thing you want to happen is to be stuck with small business accounting software that requires you to be a tech wizard in order to be able to use it. You already have enough things on your plate! So this is where Xero accounting software comes in. Xero’s software has been rigorously tested, and after evaluating close to a dozen accounting platforms, we’ve come to the conclusion that Xero Accounting is the best accounting software for small businesses.

What is Xero Accounting Software?

Started a mere ten years ago in New Zealand, Xero is a baby compared to some of the other giants in the small business accounting software industry. What they might lack in terms of history they certainly make up for in quality and innovation. Xero accounting software is entirely cloud-based. In fact, Xero was created to fill a gap in the accounting software market regarding cloud-based accounting.

What do we mean when we say that Xero is cloud-based? Quite simply it means that all of the accounting software functions don’t require you to download any programs or keep any files on your computer or mobile device. So whether you need small business accounting software or even accounting software that can handle the demands of a medium-sized business, Xero is a perfect fit. The storage of the data online gives room for you as a business operator to go through and easily manage your accounting system while you are miles away from your office, in some other city, or while busy meeting a new client. You are only always a few clicks away from gaining access to all the accounts you keep; they’re always at the tip of your fingers.

Why Xero Accounting?

As a small business owner myself, I know what it feels like to have a hundred products pitched at me. How do you make a smart decision when you are overwhelmed with choices? Ultimately, it all comes down to comparing features, weighing positive and negative feedback, and figuring out if the product meets the specific needs you have as a small business owner. So let’s dive into why Xero Accounting software is worth your consideration.

Xero pricing

Greatest Value

With Xero, you get all the basic features no matter your subscription level. That is not the industry norm as it is common for competitors like QuickBooks to charge higher prices as more features are added. Not only that, but Xero offers full functionality on both Mac and Windows. If you’re a Mac user, I’m sure you can attest to the fact that not all software primarily designed for Windows translate over to Mac well.

Xero has three base subscriptions plan available:

1.    Starter plan: $9 per month cost; limited to 5 invoices, 5 quotes, and 5 bills, along with 20 bank reconciliations

2.    Standard plan: $30 per month; unlimited transactions and reconciliations; payroll features for up to 5 employees

3.    Premium plan: $70 per month; unlimited transactions and reconciliations; payroll features for up to 10 employees (the cost increases for additional employees beyond the included 10)

Right now, Xero is offering special introductory pricing where you can get 30% off any of the plans for the first six months. Make sure to check out this special offer for yourself. You can also try out Xero risk-free for 30 days if you want to give it a test run before you commit to a monthly subscription plan.


Great Benefits

When it comes to choosing small business accounting software, it's the often the amount of quality features that determines which one you go with.

Here are just a few of Xero's best-in-class features:

  • Portability: Because Xero is cloud-based, you can use it anywhere you have an internet connection. In times past this might have been worrisome, but the internet is now becoming so ubiquitous you’ll be hard-pressed to find a spot that doesn’t have a connection. Internet connections are springing up in the wildest of locations, even in exotic locales such as Everest Base Camp. Though, if you’re planning on making it to the top of Everest, you’ll probably want to save your precious mental energy and not focus on your small business accounting! To sum everything up, if you want small business accounting software you can use in your home office, at a busy airport, in your favorite coffee shop, or a Costa Rican beach, choose Xero accounting software.
  • Minimalistic Design: The design of the software is clean and uncluttered. With Xero you don’t have to be overwhelmed by pointless menus or distracting graphics. Every single part of the user experience has been designed with one goal in mind: helping users accomplish their goals as simply as possible.

  • Ease of Use: A byproduct of the simple design is ease of use. Xero’s short learning curve gives it an edge over many competitors such as QuickBooks. This will save you time, money, and energy as you won’t have to spend hours training yourself or your financial team. But if for some reason you end up struggling to learn the ropes, the software team has put together a top-notch collection of resources that will give you the answers you deserve.

  • Financial Graphs: Xero comes equipped with a nifty graph tool that enables customizable data displays for the user. Using this graph tool, the user will gain a solid picture of financial growth or decline without the need to do the tedious work of going through individual financial records.

  • Security: In a market that has been at times dominated by easily-hackable software, Xero provides an accounting software solution that users and clients can trust with their valuable information. All data is protected by industry-leading data encryption, server backups, two-step login verification, regular security audits, and layers of firewalls.

  • Client Connection: With Xero you can easily stay connected to your clients, business partners, and accountants anywhere in the world. After meeting with a client, hop onto Xero and send them an invoice just minutes after meeting with them. Impress your clients with your fast communication.

  • Data Loss Protection: Worried about losing your valuable data if your computer crashes? Xero provides you with peace of mind by storing all of your data on their dedicated servers. If something unfortunate happens to your computer, simply login to Xero’s website with a new device and you’ll instantly have all of your data at your fingertips.

  • Sales Tax: Xero will calculate automatically sales tax based on each address you input. In addition, default tax rules and rates can be set for individual categories, customers, and purchases.

  • Multiple Currencies: There is support for over 160 different currencies.

  • Integrations: Xero has over 500 add-ons and integrations to choose from. If there’s a feature you need that isn’t built into Xero, you will most likely find the solution in the app marketplace. Some of the integrations are Paypal, Square, Shopify, Vend, Expensify, G Suite, Deputy Payroll.


As a small business owner, you don’t need me to tell you that your time is money. And so small business accounting software that saves you time would be worth its weight in gold. Thankfully, with Xero you’ve found the time-saving solution you’ve been searching for. Its automation and batch processing features eliminate the need to do hundreds of repetitive tasks.

Here is a brief overview of a few of those features:

  • Mobile: All of your important data can be accessed on the majority of today’s phones and tablets. Make important adjustments and accomplish crucial, time-sensitive tasks in the palm of your hand. 
  • Purchase Orders: Email and create orders directly from Xero. Afterwards, create invoices by simply copying the order information. 

  • Reconciliation: All of your reconciliation can be automated. The process is simple. Link your bank accounts to Xero so the software can start importing all of your financial transactions. This imported data will then be synced with existing bookkeeping data. Xero also provides users with the ability to create reconciliation rules so that bulk categorization of transactions can occur.  

  • Payroll: All of your payroll needs can be met by this software. You won’t even have to worry about calculating taxes or making sure they get submitted to the appropriate parties.I

  • Inventory: You can keep an eye on inventory levels with Xero. In addition, you can view data that shows what items are bringing you the most profit. 

  • Contact list: You can create contact lists for the purpose of keeping the communication, bills, and quotes you have with individual customers in one place. 

  • Invoicing: Create automated invoices with late payment reminders to send to your customers and clients. Any payments they make are synced automatically within your accounting data. More information about invoicing features can be found on Xero's website. 

  • Bill Pay: Easily schedule bill payments so you don’t have to spend time staying on top of all your due dates.

Elite Customer Service

What we’re about to say might shock you at first.You can’t call Xero for software support.

Now hear us out before you decide to stop reading any further. While this might seem unusual for a major company, Xero has a purpose behind this. They don’t want you to have to wait on hold on for an unreasonable amount of time. So instead they offer support through email and live chat. Send them an email about a problem you have and they will either email you back or give you a call depending on the urgency of the situation. Xero promises a 24 hour response time for emails, but many customers have stated they’ve received a reply in as little as an hour.

Support is also available through several other avenues:

  • In-software help button: You can search for solutions from within the software itself. In addition, you can request that a service representative connect to your software using read-only access. This allows Xero to see the exact issue you are dealing with so they can offer you the right solution.

  • Live chat: A service representative will be available on Xero’s website to answer questions you may have. They prefer questions related to sales, but customers have reported that the representatives are still willing to answer basic support questions.

  • Help center: Xero provides an extensive directory of articles concerning common issues and their solutions.

  • Community Forum: Xero hosts a community forum where you will find users listing and answering each other’s questions. If you’re experiencing an issue with Xero’s accounting software, it’s safe to assume you’ll be able to find an answer there.

Wealth of Resources

Although Xero’s interface is intuitive and its learning curve small compared to other accounting software, there is still a lot for the user to learn in order to use Xero to its fullest potential.

Thankfully Xero provides a huge amount of learning resources to glean from:

  • Xero TV: Xero TV is an extensive catalogue of several hundred videos that explain Xero’s features.

  • Guides: There are many helpful guides (https://www.xero.com/us/accounting-software/) on Xero’s website that go in-depth about each software feature.

  • Blog: Xero has a blog that features daily content and business news from around the world.

  • Podcasts: Xero even has its own podcast show where you can find interviews with some of today’s brightest thought leaders and entrepreneurs.

Here is an example video that demonstrates just how helpful and informative Xero resources can be:

Some Limitations of Xero

While Xero has been superbly put together, we'd be remiss to keep this an entirely glowing review since no software is perfect. 

Here are the most glaring limitations we noticed:

  • Limited invoice template choices: You can add your company logo, but that’s about as much customization you can make on their templates.

  • No initial phone support: Some customers have expressed a desire for the option to call Xero immediately for support.

  • Mobile version lacks features: The mobile app doesn’t have all of the features that the desktop version does.

  • Payroll feature unavailability: Currently Xero only offers payroll functionality for 35 states. However, Xero does seem to be speeding up the process of getting payroll support for all 50 states. Check here to see if your state is available!

Want to Switch Over From QuickBooks?

It's not as ominous as it sounds! Xero offers a short, 3-minute long tutorial on how to transition without any hiccups.

Wrapping Things Up 

It’s no surprise to see that Xero Accounting is one of the most cutting-edge small business accounting softwares in the world. Xero has a lot going for it. Because of its legendary customer support, time-saving features, automation processes, security, and mobility, Xero will make a great match for many small businesses. Sure, Xero has its faults, like the unavailability of payroll support in certain states. However, its combination of simplicity and rich features means Xero still far outpaces the majority of its competitors.

We hope this review of Xero helped to make your search for small business accounting software easier. We realize that you might not want to rely on our review alone to make your software choice, which makes complete sense considering the cost of accounting software.

So why not try out Xero for yourself with a free 30 day trial? And go ahead, check out Xero's website! It's just as beautiful as their software.

Do you have any experience with Xero Accounting? If so, let us know in the comments below.

Overall Rating - 4.8/5


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