Xero VS QuickBooks Online
In cloud accounting software, the two biggest names are QuickBooks and Xero. But when you have two very capable software options, which do you choose? Well, that’s what we’re here to help with.
Developed in 2004, QuickBooks Online (see our review) beat Xero to the accounting scene by two years. With advanced accounting features, beautiful invoicing, and 400+ integrations, it’s easy to see why the software is so renowned.
Xero (see our review) is a robust accounting solution that rivals QuickBooks in terms of capability and popularity. It’s been around since 2006 and offers fully featured mobile apps, amazing customer service, access for unlimited users, and an impressive feature selection.
At Merchant Maverick, our goal is to help you to find the best software for your small business needs. To make your decision easier, we’ve carefully researched and tested both products. We’ll put QuickBooks Online and Xero head to head by comparing features, pricing, customer experience, reputation, and more, so you don’t have to.
Don’t have time to read the whole post? Or looking for a different accounting option? Check out our top-rated accounting solutions to see our favorite recommendations.
Table of Contents
- Hardware or Software Requirements
- Users and Permissions
- Ease of Use
- Mobile Apps
- Customer Service and Support
- Negative Reviews and Complaints
- Positive Reviews and Testimonials
- And the Overall Winner Is…
Both Xero and QuickBooks Online offer strong accounting. Each uses double-entry accounting and support cash-basis and accrual accounting. In addition, each software has strong accounting features including bank reconciliation, fixed asset management, a chart of accounts, and plenty of accounting reports.
|Chart of Accounts||✓||✓|
|Fixed Asset Management||✓||✓|
|Importing & Exporting||✓||✓|
This battle was a doozy. QuickBooks Online and Xero offer very similar features. In some instances, like invoicing and project management (which Xero doesn’t offer at all), QuickBooks Online far exceeds Xero. In other places, like contact management, Xero provides the better feature. So how did we decide who is better?
In the end, it all came down to accessibility. QuickBooks Online offers many great features—project management, budgeting, and inventory, etc.—but there’s a catch. These features are limited to the more expensive plans. Xero doesn’t limit features by plan, making it a more robust and realistic solution for many users.
QuickBooks Online offers three pricing plans ranging from $15/mo – $50/mo, with payroll costing an additional $25 a month (plus $5/per employee). Xero offers five scalable pricing plans ranging from $9/mo – $180/mo.
For some businesses, QuickBooks Online is a much more affordable option. Xero’s smallest plan only gives customers 5 invoices and 20 transactions, which renders this plan useless to many small business owners.
For medium to large size businesses, Xero is the better choice. Xero offers payroll at no additional cost and supports unlimited users for every plan. QuickBooks Online doesn’t even come close in this regard.
So, this category is a draw. The real winner will depend entirely on your business size and needs.
Hardware or Software Requirements
As cloud-based software, QuickBooks Online works with nearly any device so long as you have Internet access and are using one of the following browsers:
- Google Chrome
- Mozilla Firefox
- Internet Explorer 10+
- Safari 6.1+
Xero is also cloud-based; it’s compatible with nearly any device so long as you have an internet connection and are using one of these browsers:
- Google Chrome
- Internet Explorer 11
- Microsoft Edge
- Mozilla Firefox
- Safari 8+
Both QuickBooks Online and Xero offer mobile apps for Android and iPhones.
The only reason Xero takes the cake in this category is that you can use Xero with Linux, a capability QuickBooks Online currently doesn’t offer.
Users and Permissions
Xero offers unlimited users for all five of its pricing plans. The company also provides some of the strongest user permissions in cloud accounting. QuickBooks Online only supports one, three, or five users depending on your pricing plan (you can add up to two accountants to your plan as well; these do not count as users).
In the end, how can you beat unlimited users?
Ease of Use
QuickBooks Online used to be the clear winner here, but QuickBooks Online has recently made changes to their UI, leaving the software difficult to navigate. And Xero is only easy to use once you get to know the software. There is a steep learning curve and setup can be quite intensive. Xero offers plenty of support tools to get over this learning curve (which is more than QuickBooks Online can say). Because of QuickBooks Online’s recent downgrade and Xero’s steep learning curve, the programs are tied in this category.
Winner: QuickBooks Online
While there are a few complaints about QuickBooks Online’s mobile apps, most users find the apps incredibly helpful and easy to use. The apps receive 4.2/5 stars on iTunes and 4.3/5 stars on Google Play Store.
One of the biggest complaints about Xero is that their mobile apps are lacking key features and are ridden with bugs and crashes. It’s easy to see the winner in this section.
Customer Service and Support
Xero has the best customer service by far. In my experience, Xero representatives are well-informed and very quick to respond to customers. The company also offers ample online resources, including a comprehensive help center, an in-software help button, a community forum, and lots of business and accounting guides.
While QuickBooks Online has been attempting to remedy their issue with poor customer support, the company still has a long ways to go. Response times are slow, representatives are often uninformed, and there isn’t a help center at all. On the plus side, QuickBooks Online does provide a contact phone number (Xero does not—a fact quite a few users have complained about).
Negative Reviews and Complaints
Winner: QuickBooks Online
This is one category QuickBooks Online should not want to win, and yet here they are! QuickBooks Online has received many user complaints regarding poor customer service, bugs, limited mobile apps, and even unauthorized charges.
Xero, on the other hand, has received very few customer complaints (which, admittedly, could be because it has half as many users as QuickBooks Online and hasn’t been around as long). The software is well-loved by most of its users and receives higher ratings across popular customer reviews sites.
Positive Reviews and Testimonials
While QuickBooks Online receives more positive reviews in terms of numbers, Xero receives a higher percentage of positive to negative reviews, which is why we’ve given it the victory in this section. Xero receives 4.4/5 stars on GetApp and 4.3/5 stars on G2crowd (on this same site, QuickBooks Online only receives 3.1/5 stars).
Xero has over 500 integrations, while QuickBooks Online comes in with over 400 integrations. Xero outnumbers QuickBooks Online here, but let’s be honest: once a company hits the couple hundred integrations mark, what more could you ask for? Both of these companies are the top accounting software companies when it comes to integrations, so you can’t go wrong with either choice.
Ordinarily, this section results in a tie, but Xero has set itself apart in terms of security.
Both QuickBooks Online and Xero use data encryption, redundancy, and physical security measures at their prospective data centers. However, Xero boasts an unheard-of 99.97% uptime and has one of the strongest security reputations in the cloud accounting world. Of course, QuickBooks has one of the other strongest reputations in the accounting world, so, again, you really can’t go wrong with either option in this regard.
And the Overall Winner Is…
QuickBooks Online put up a very good fight, but in the end, Xero edged out the competition in a few key areas. Xero offers accessible features, better customer service, and more positive reviews. In this comparison mash-up, the people truly have spoken, and Xero is the winner.
This software is ideal for mid- to large-sized businesses, or businesses looking for a scalable software that will grow with their company. The company even holds the Merchant Maverick title of “Best Accounting Software for Larger Businesses.” If you are looking for strong accounting capabilities, Xero won’t let you down. It’s important to note that there is a steep learning curve with this software, so if you’re not up for the challenge, QuickBooks Online might be a better choice.
Although QuickBooks Online didn’t win this mash-up, this software is still a contender for many businesses. This software is particularly ideal for small businesses; it’s even earned the title of “Best Accounting Software for Small Businesses” here at Merchant Maverick. If your company relies on invoicing, QuickBooks Online’s invoicing capabilities are far beyond anything Xero can do. If you need a project management feature, QuickBooks Online is also the way to go. Or you may find that neither company meets your needs entirely. In that case, our comprehensive accounting software reviews can help you make an informed decision during your hunt for the perfect accounting software.
Read our full Xero and QuickBooks Online reviews for more information. After doing your research, be sure to take advantage of the free trials that accounting software companies offer and feel free to reach out with any questions you have along the way.