Cloud Accounting

Enterprise_Warrior

Hi Everyone

So I am looking to take the plunge in terms of offering clients a cloud based solution and have three providers in mind. It's either Xero, Quickbooks or Sage One.

I have been talking with Xero today and was worried that the cost would be prohibitive as the standard business edition was £22 + VAT per month and by adding Payroll, it is an extra £5 + VAT per month. As I am not VAT registered (and my clients aren't), this either means either increasing their bill by an extra £32.40 or keep their fee the same and take the hit. I know they will not go for the increase so I would have to take a hit.

Xero then told me that if they do their invoicing manually and you don't use Xero for Payroll, you can get the cashbook edition for £5 + VAT per month that still links to their bank account and you can run P&L and BS reports through it. This would work for my clients.

Can somebody please advise on the transition from desktop to cloud accounting?

Thanks

EW

Enterprise_Warrior

@Mickdundee

Why should I bear the cost of the cloud software? The only difference is that I am publishing their information on a website rather than through my own desktop software (which is free because I built it). The client is getting the benefit of real time information. I am not getting any benefit as I still have to do all the bookkeeping which is exactly the same whether I use desktop or cloud software.

By absorbing the cost myself, the £60 I charge per month (for example) goes down to £27.60 and I still have to do the same amount of work as before.

That makes absolutely no sense at all.

Enterprise_Warrior

@Mickdundee

Sorry, read your message the wrong way around and I think you did the same with me.

I want to pass the cost on.

Bmer82

xero definately seems to be one of the more expensive solutions when compared to QBO and Sage.

Enterprise_Warrior

Which one do you use @Bmer82?

Bmer82

am only at the planning stage as yet but using a combo of QBO and capium for my planning assumptions

Bmer82

but with MTD arriving selling your clients on cloud software should become easier a simple equation -look guys adopting this software will mean i will not have to substanially increase my fees when your staging comes the current provision wont suffice without additional chargable work yadda yadda yadda

Gem7321

I recommend ClearBooks. With partner discount the equivalent of the xero 'premium' package is £15 per month including VAT and they are introducing a 'Micro' version to comply with MTD for spreadsheet clients which will be free to use but they have hinted there will be a nominal fee for making submissions.

We also still use VT for bookkeeping we do ourselves so I can't really comment on the transition but we will be exploring the Micro package of ClearBooks when it's available.

burg

Apologies as this post may get long.

Traditionally, and currently still the case for most, we do 'bookkeeping' in house using VT Transaction +. When I say bookkeeping this is more data entry for accounts prep purposes.

We then went down the route of Clearbooks a few years back and viewed it as you have i.e. we are adding software to clients and they should pay for this. The take up was pretty low as many couldn't see the value.

We then shifted our view. We noticed different clients want different things. Some want to be really involved and others would rather pass it all off. One thing was clear in that they all want to be compliant. We therefore changed things completely. Rather than viewing the software as an additional cost view it as a tool to make things easier.
So from then looking at software at a different angle the main objective of that software was usability for a lay person. For us Xero came out on top. It's really easy to use and very easy to demo to clients.

So our new packages were formed:-

Basic package - This keeps costs low but expects clients to do all data entry themselves. With bank feeds set up and 30 mins of training we spend very little time still on these clients. It is a question of checking over their entries and moving them around. With Xero find and recode this is very easy. Yes we have now incurred additional costs on software but we have cut down on staff time spent on basic tasks.
Clients who want us to do bookkeeing are facing some higher fees as they are now paying for software. We do absorb some of the costs though as we can utilise the technology and save time. Bank feeds save a huge amount of data entry. As does something like AutoEntry or Receipt Bank. When you consider other background apps such as POS systems and expense claims systems and various others the time saving can be huge.

Now here comes the opportunity. You have now built clients into rather being focused around compliance they are prepared to look at figures mid year. That gives opportunity for increased fee income. You can now potentially charged for management accounts, or in year tax planning. Not new features but new to these types of client.

Given this if you look at the bigger picture rather than a piece of software as an increased cost but more of a tool for achieving so much more than you can for such small fees per client then you can start to make the software work for you and help your business grow.

Like it or not software is here to stay and with MTD will become common place. To survive MTD Accountants must be at the forefront of technology. Clients will not be confident in these areas and they will want reassurance from their accountants as it won't be coming from the government. My advice is embrace it now and learn as much as you can so you can be best equipped to help the clients current and future as best as they can be helped.