Quickbooks Online VS Xero
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|✓||Ease of Use|
|Tie||Customer Service & Support||Tie|
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In cloud accounting software, the two biggest names are QuickBooks and Xero. But when you have two very capable software options, with similar accounting offerings and a nearly identical feature set, how do you know which is better? That’s what we’re here to find out.
Developed in 2004, QuickBooks Online beat Xero to the accounting scene by two years. With advanced accounting features, beautiful invoicing, 250+ integrations, and a brand new lending feature, it’s easy to see why the software is so renowned by accountants and bookkeepers.
Xero is a robust accounting solution that rivals QuickBooks in terms of capability and popularity. It’s been around since 2006 and offers strong accounting, access for unlimited users, over 700 integrations, 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 compare QuickBooks Online (QBO) and Xero based on 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
Both Xero and QuickBooks Online offer strong accounting. Each uses double-entry accounting and supports 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.
Winner: QuickBooks Online
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QuickBooks Online and Xero offer very similar features. In some areas, like invoicing, project management, and lending, QuickBooks Online far exceeds Xero (especially since Xero doesn’t offer lending). In other places, like contact management, Xero provides better features. So how do we decide who is better?
Xero used to be the clear winner because every feature was accessible on every plan. Now, Xero limits advanced features to the most expansive plans just like QBO. So it all comes down to the details. QuickBooks Online offers much better invoicing with multiple templates to choose from as well as built-in packing slips. Xero only has one invoice template and you have to download and import a packing slip template into the software. QBO also offers lending, which makes it a better solution for small businesses looking for the whole feature package.
QuickBooks Online offers three pricing plans ranging from $15/mo – $50/mo, with payroll costing an additional $36 – $99 per month (plus $2/per employee). Xero also offers three pricing plans ranging from $9 – $60 per month, with payroll starting at $39/mo (plus $6/per employee).
In terms of pricing, the real winner will depend entirely on the size of your business.
For small businesses, QuickBooks Online is a much more affordable option. Xero’s smallest plan only gives customers five invoices and 20 transactions, which renders this plan useless to many small business owners. You get a lot more bang for your buck with QBO’s smaller plans.
For medium-sized businesses to large businesses, Xero’s pricing could be better. Xero offers unlimited users with every plan so if your company has more than five users, Xero could be a lot cheaper than QuickBooks. With QuickBooks Online, the largest plan only supports five users; you can add up to 25 users, but at an additional cost. In this case, it will all come down to your business’s size and needs.
Hardware & Software Requirements
As cloud-based software, QBO 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 with internet access and works with any 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 iPhone.
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 & Permissions
Xero offers unlimited users for all three of its pricing plans, plus incredibly strong user permissions so you can control who has access to which features. QuickBooks Online only supports one, three, or five users depending on your pricing plan (you can add up to twenty-five users total, but the cost adds up fast). QBO also has users permission, but in the end, you can’t beat unlimited users.
Ease Of Use
QuickBooks Online is the clear winner here, offering a well-organized UI. Minus the occasional navigational difficulty, it’s easy to get used to the software and learn how it works.
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 does offer plenty of support tools to get over this learning curve, but QuickBooks Online is definitely easier to use.
If you end up choosing Xero, check out our free How To Set Up Your Xero Account guide to help you get started and optimize your Xero account.
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 4.7/5 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.
Customer Service & Support
Xero used to have great customer support but has recently declined to the same level as QuickBooks (a place Xero doesn’t want to be). Xero offers no phone support and email response times are long. While there isn’t a good, fast way to get a response from Xero, the company does have a lot of great support options to help you learn and troubleshoot the software.
QuickBooks has notoriously poor customer service with extremely long wait time and holds. The company has made significant strides to shorten their wait time and offer a better Help Center, but many users still aren’t happy with QBO’s support. Both companies leave something to be desired when it comes to customer support
Negative Reviews & 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.
While Xero has far fewer complaint, users still have issues with the company’s limited mobile apps, steep learning curve, and recent price changes.
Positive Reviews & Testimonials
While QuickBooks Online has 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 has earned 4.3/5 stars on GetApp and 4.2/5 stars on G2crowd.
Xero has over 700 integrations, while QuickBooks Online comes in with 250 integrations. QuickBooks Online used to offer upwards of 400 integrations but has dropped this number recently.
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. In addition, QuickBooks Online users have reported downtime and outage issues on several occasions.
And The Overall Winner Is…
The tables have turned! For years, Xero was the clear winner. But with a recent change in price structure, Xero has lost the key points that set it apart like feature accessibility and built-in payroll. While Xero is still great software, these changes, plus a few recent QBO updates, were just enough for QuickBooks Online to edge out the competition.
QuickBooks Online is full-featured accounting software that sets itself apart with amazing invoicing automations and a unique lending feature (read our QuickBooks Capital review to learn more). The software is easy to use and offers great mobile apps so you can run your business on the go. The software is ideal for small businesses and has even won the Merchant Maverick title for Best Accounting Software For Small Businesses.
While Xero didn’t win this match-up, the software still has a ton to offer and might be the better fit for your business. This software is ideal for mid- to large-sized businesses, or businesses looking for scalable software that will grow with their company. (That’s why we’ve named Xero the 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.
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. If you need extra help deciding, read our Complete Guide To Choose Online Accounting Software.
Check out our full Xero and QuickBooks Online reviews for more information. After doing your research, be sure to take advantage of the free trials and please reach out with any questions you have along the way.