QuickBooks vs. Excel: Choosing The Best Software For Your Business

Businesses that don’t have a clear picture of where their finances stand are doomed to fail. So, many owners take certain actions to keep their small businesses alive. One of these steps is tracking finances; by using accounting tools and software to do this. However, choosing the right software may be a bit challenging. In this article, we’ll be comparing QuickBooks vs. Excel to help you decide on the software that suits your goals.

Comparing Excel vs. QuickBooks 

Most of you will be aware of the main difference between Microsoft Excel and QuickBooks. But we’ll recap these for those who are not. 

Excel is a spreadsheet application and QuickBooks is accounting software.

So, what’s the point of comparing QuickBooks vs. Excel? The thing is that you can use either of these tools or even both of them for your business accounting. In some cases, Excel is the best option; in other cases, you’d better opt for QuickBooks. Therefore, our goal is to reveal these cases to optimize your accounting and bookkeeping experience. Let’s start with a brief intro to the differences between these apps.

About QuickBooks

QuickBooks is one of the top accounting software solutions for small businesses. It is considered the standard choice for a company that requires the constant services of bookkeepers. It has a set of inventory management tools that provide significant features with flexibility and scalability.

The two main QuickBooks products from Intuit are QuickBooks Online and QuickBooks Desktop.

QuickBooks Online

QuickBooks Online is cloud-based accounting software for small businesses. It has four pricing plans and high-level features for solid accounting, online payroll, appealing invoices, and add-ons like QuickBooks Time. 

QuickBooks Online is an excellent choice for early-stage small businesses due to its ease of use and user limit of 25. With its cloud-based program, you can manage your business from anywhere with an internet connection, and you can do so on the go, thanks to its mobile app.

It has solid features, a user-friendly interface, and integrations for straightforward basic/mid-level accounting. Unfortunately, QuickBooks Online has fewer (advanced) features than QuickBooks Desktop.

On the bright side, QuickBooks Online is easier to learn and use than QuickBooks Desktop, although you need to have prior knowledge of accounting already to enjoy it. 

QuickBooks Desktop

QuickBooks Desktop is designed for small/mid-size businesses that want a desktop solution or need advanced inventory and industry-specific features. 

It is available offline, supports up to 40 users, and comes in three versions: Desktop Pro, Desktop Premier, and Desktop Enterprise. 

• Pro is ideal for small businesses.
• Premier for medium businesses, and 
• Enterprise for companies having more staff.

Each plan progresses based on the number of users and features available. Sadly, these accounting tools and features, such as expense tracking, budgeting, and job costing, as well as more than 240 integrations and positive customer reviews, are only available on the QuickBooks Windows desktop version. 

If you’d like to run QuickBooks Desktop on Macs, you must consider QuickBooks for Mac for a locally installed Mac-based QuickBooks option.

About Excel

Microsoft Excel is a popular spreadsheet program and one of the most widely used in business. In Excel, you can enter data in rows and columns and use formulas to organize, format, and calculate them. Initially, only the desktop version of Excel existed, but the online version became available recently. 

Excel desktop

The Excel desktop version boasts many remarkable features and functions that have made it the most reliable spreadsheet in the world for the past three decades. With years of research and improvement, it’s tough for any other software to match its versatility and features.

The desktop version proves more reliable with its offline access, expandable storage, and collaborative features through OneDrive. Its only downsides may be limited accessibility and pricing. 

Excel Online

The Excel Online application is a straightforward, trimmed-down version of the conventional Excel program. It covers many of the same areas as the traditional Excel application, but exceptions exist. 

Because Office 365 provides nearly all of the cloud-based Microsoft Office applications’ features, it’s simple to use much of the new functionality in the Excel Online app that isn’t available in the traditional version. 

However, using Excel Online relies heavily on having a steady internet connection which may be quite a disadvantage if the connection is slow or has a fault. It also has limited storage capacity, which makes it unfit for big projects.

Bookkeeping with QuickBooks vs. Excel

There is no doubt that the objectives of small businesses differ from one another. This means that some businesses can go with QuickBooks, while others can use Excel spreadsheets for their needs. Let’s take a look at the bookkeeping cases for Excel vs. QuickBooks.

When is QuickBooks the best for small business bookkeeping?

If your business requires and focuses on accounting or bookkeeping exclusively, then QuickBooks is well-suited to your needs. 

QuickBooks is designed for those who already have sufficient knowledge of accounting and for small/mid-size businesses that need advanced inventory and industry-specific features. 

With its cloud-based collaborative program, QuickBooks makes a great fit if you like to manage your business from anywhere. It is also an excellent choice for early-stage small businesses due to its ease of use.

Excel isn’t built solely for accounting purposes, so if your goal is to get the best accounting results with automated software, QuickBooks is your answer. 

QuickBooks offers

• Remote collaboration: Its cloud-based program allows you to work with your bookkeeper even though they live a thousand miles away from you. 

• A user-friendly activity dashboard: Unlike Excel, QuickBooks makes accounting easier with an interactive user interface that presents your data in easily understandable ways. 

• Electronic payments: With a feature that lets you connect your QuickBooks account to your bank or other payment options, electronic payments are seamless and easier compared to Excel. This makes it easier to make deposits and account for funds with QuickBooks. 

• Integrations for basic/mid-level accounting: Billing, invoicing, audit trail, auction management, cash flow management, expense tracking, budgeting, and job costing, as well as more than 240 integrations make QuickBooks the ideal accounting software for small-mid sized businesses.

• Automated payment reminder: This notifies you of payments you need to make before they are due, giving you enough time to make the necessary preparations.

• Bank Transactions:  This allows you to link your bank account to your QuickBooks account, making it easier to complete transactions without having to log out or check in with your bank directly.

• Receipt capturing: The mobile version of QuickBooks has a feature that most small businesses will benefit from—receipt capturing. This helps you upload your physical receipts to your financial database for easy retrieval. 

When bookkeeping in Excel vs. QuickBooks is best?

While QuickBooks restricts your ability to create custom ledgers, balance sheets, financial statements, and more. Excel gives you the flexibility to add rows, columns, and functions as you please. 

If you value freedom and flexibility when deciding between Microsoft Excel vs. QuickBooks Online Advanced in your accounting/bookkeeping, then Microsoft Excel is a reliable choice for your business. Excel is also a great choice if your small business requires technical spreadsheet functions that go beyond accounting,

Unlike QuickBooks, Excel isn’t solely for accounting purposes. With Excel, you can explore a wide range of functions and formulas to do whatever you want in your accounting. 

Excel offers

• Familiar interface: With the familiar spreadsheet interface, Excel offers you the freedom to input your data from scratch with whatever template you want.

• Charting: This feature helps you present financial data in charts for easier understanding and comprehension and create sophisticated graphs.

• Advanced data organization: With advanced data organization features, you can control and manage your data in the order that suits your business goals. 

• Built-in formulas: There are hundreds of functions and formulas to tackle complex calculations and financial accounting for your business. 

• Greater collaboration and flexibility: Excel can be freely edited by anyone on your team, so there’s an automatic increase in collaboration. 

• Third-party Integration: Excel integrates well with a host of other third-party software and extensions. 

Bookkeeping with Excel is more flexible when compared to what QuickBooks provides. You can customize the interface to your present data in an understandable way.

Bookkeeping with QuickBooks and Excel in one go

If you can’t choose between Excel vs. QuickBooks, then take both 🙂 It’s partly a joke because actually, you can do way more with both tools anyway. QuickBooks can be set up for accounts exclusively, while Excel can cope with different data manipulation tasks that you can’t do in QuickBooks. Fortunately, you can easily integrate QuickBooks and Excel to automate exports of data with Coupler.io. It’s a data integration solution to load data from multiple apps to Microsoft Excel, Google Sheets, or Google BigQuery.

With Coupler.io, Microsoft Excel can function as a reliable destination spreadsheet for your QuickBooks data in order to store, process, visualize, and share it with the appropriate parties. The QuickBooks integration also allows you to easily schedule and automate basic data transfer from QuickBooks Online, such as importing raw accounting records, transactions, invoices, pre-made reports, and other information. 

This means you don’t have to struggle with analyzing data or managing reports when you have to collaborate with QuickBooks from Excel. You’ll also have a better overview of the state of your finances and with no code or technical knowledge required. 

By the way, Coupler.io can help with business analytics as well! They provide data analytics consulting services for businesses or projects that strive to make data-driven decisions. The range of services covers retail sales analytics, finance tracking, data infrastructure, and many more.

Advantages of QuickBooks vs Excel

Like any other software in existence, both Excel and QuickBooks are a fine blend of pros and cons. Below we explore the advantages of Excel vs. QuickBooks for small businesses, plus their downsides.

Advantages of QuickBooks     

• Comprehensive reporting and record-keeping

Keeping thorough and detailed records is easy with QuickBooks Online. It provides valuable options such as adding memos, attachments, and reference numbers. There’s an option to split expenses into different categories as well.

With an interactive, user-friendly dashboard, you can keep track of inventory and plan out the costs of a project. All these features help you grow your business by showing you how to reduce costs with the latest tactics.

• Detailed inventory management

QuickBooks Online provides features to help you track inventory and costs of goods with an option to get an alert when you’re low on stock. It also allows you to sync your list with apps like Amazon or Shopify while creating purchase orders and managing vendors.

• Wide-ranging integration

With access to 600+ apps plus third-party software, including add-ons, QuickBooks wins this department’s QuickBooks vs Excel debate. It allows you to prepare your taxes quickly, obtain business funding, run payroll, manage customer accounts, and generate various other reports and financial insights.

• Accessible support

Unlike Excel, there is readily available support and resources to help you navigate QuickBooks. The platform provides good videos, online training, forums, and more for direct help if the need arises.

Disadvantages Of QuickBooks     

• Lack of customization for reports 

It is hard to use if you lack a basic understanding of accounting. While you may be able to use other software alternatives without explanation, QuickBooks may require some practice. However, you will get more out of the software if you understand its full functionality.

To learn how to use QuickBooks Online for your business, you can watch tutorials, read support pages, or seek advice from experts.

Advantages of Excel 

• Enhanced Data Manipulation Options

Being a standard spreadsheet software, it is easy to input data into Excel. It is easier to perform accounting formulas and computations to create financial statements with set formulas. Your data is easy to organize, access and customize.

• Graphic representation

With advanced plotting and charting functions, you can use Excel to illustrate financial data to make it easier to understand.

• Simple and Flexible Functionality

Excel allows you to do whatever you want, unlike most accounting software. You are not restricted by presets or limitations that are common in programs designed for a single purpose.

You can remove or add whatever data and categories you require and create other worksheets to serve as a database for your customers. You can also format your data however you want. Your only limitation is your ability to think creatively and analytically.

Disadvantages Of Excel 

• Input errors

One of its major setbacks is that you have to manually enter your data into Excel every time manually unless you use Coupler.io :). That’s the issue with spreadsheets generally, and this puts your data at risk if you make a mistake. Even the presence of excel templates doesn’t protect your data from human error.

• Security issues

Although Excel has its own way of safeguarding your files by locking cells, formulas, sheets, etc., your financial information may be jeopardized if you lack the technical know-how to protect your files.

Choosing between QuickBooks vs. Excel for small business

Before choosing any software for your business, you have to consider your business goals and how the software will help you achieve them. And don’t forget to put your budget into consideration as well.

Excel is a one-size-fits-all software. You can transform it into whatever you want. QuickBooks is designed for only accounting purposes.

Excel for small businesses is a great choice if you want the freedom to do whatever you want with your financial data. QuickBooks is ideal if all you want to do is simply enter your financial records.

QuickBooks is the way to go if your small business focuses on accounting and other related features such as invoicing. The software’s integration with other apps might very well improve your finances. Excel can be used to create sophisticated graphs and charts. QuickBooks includes only accounting graphs.
So, which is the best in our comparison of QuickBooks vs. Excel for small business? You tell us because you will know your requirements and tasks to cope with. Check out either of the tools or, better both of them to make a sound choice. Good luck!