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Top 10 Alternatives to Xero: Analysis of Best Accounting Software Tools

What is the best alternative to Xero?
FreshBooks is the best alternative to Xero. It has more features housed in easy-to-use modules, from expense and time tracking tools to accounting reports and payments support. Moreover, it is highly flexible and easily customizable. It can be used by any type of business of any size in any industry.

More and more companies are migrating from their legacy accounting software to cloud-based financial management suites. This allows them to free up hardware expenses and access their platforms anywhere; and even on mobile. One of the most popular ones is Xero. Many consider it as an all-in-one business solution as it integrates seemingly disparate functions into one single hub. It has modules not only for accounting but also for inventory, payroll, and invoicing, among many others. This is why it is among the top accounting software solutions today.

Despite its strong offering, there are also other products that rival or may even surpass Xero in terms of relative operational fit. Xero might be too general for some that they would rather have specialized accounting software for, let’s say, ecommerce or pet services. Also, there are also companies that may find Xero’s offer too limited. This is why, in this article, we will introduce alternatives to Xero that are either more specialized or more comprehensive.

top 10 alternatives to Xero

In 2021, 58% of enterprises have been reported to use cloud accounting solutions. And, recent accounting statistics show that even small companies, 78% of which, were using cloud accounting in 2020. Accounting software adoption, in the same year, was also gearing up as tech spending of accounting firms continued to increase. Large firms lead the pack with a 60% increase. Small firms are second with 41%, while mid-sized firms increased their tech spending by 38%.

With this, experts estimate that by 2024, the United States accounting software market alone will reach $416.23 million. And, cloud-based software solutions are looking to be more popular than ever. This is because around 67% of accountants, in a study, revealed that they prefer web-based software over on-premise ones.

enterprises using cloud accounting solutions

The market is also quite exciting as accounting professionals have been investing in emerging technologies even back in 2020. The top ones include 5G (22%), advanced and predictive analytics (21%), and automation (20%). Other exciting technologies that accountants are investing in include natural language processing (NLP) and blockchain. So, in the next five to 10 years, expect cloud-based accounting platforms to include some of these advanced features and capabilities.

However, this is not to say that today’s accounting solutions are not enough. The top ones, like Xero, have very comprehensive feature sets that any business of any type, size, and industry can benefit from.

What is Xero?

Xero dashboard

Xero is described as a software solution that has revolutionized the digital accounting sector. Users say this app has been developed with the user experience in mind and offers the exact accounting features they need.

The best part about Xero is that even lay users will find it easy to manage. It makes even complex work such as double bookkeeping simple to handle for novices. For this reason, the app has become a prominent brand name in the accounting software market. If you have not hired the services of a bookkeeper, do not worry, as you can count on the assistance of the vendor’s certified advisors.

Xero is a company based in New Zealand and its accounting product has become popular in the US, UK, European, and Australian markets. Today, the company operates 20 global offices and it has won many awards for its high-quality software and services.

Xero is used by more than 475,000 sole and business accountants. The app integrates seamlessly with leading third-party solutions and accounting systems. If you have simple needs, you can start with the basic Starter plan for $25/month. However, if your needs include more number of quotes, invoices, and bills as well as multi-currency features, then you can subscribe to the premium packages. The vendor offers a handy 30-day free trial you can use to check out the features before you shell out your money.

Benefits of Xero

  • You don’t need comprehensive training to learn to use the app.
  • It facilitates fast and accurate transacting.
  • The vendor offers an Express Setup feature as well as a help center to help you maximize the app’s potential.
  • You can use the dashboard to monitor your company’s billing and invoicing status, and compare finances.
  • Use the Accounts menu to find and alter checks, bank accounts, and expense claims, and create records for your payroll needs.
  • Finally, the app utilizes the multiple-approval model and two-factor authentication to minimize the risk of financial fraud.

If you are looking for a wider choice, we have got you covered as we also analyze the main benefits of top Xero alternatives. We provide you valid reasons why you should consider Xero instead of the alternative application and vice versa.

Top 10 Xero Alternatives

1. FreshBooks

Freshbooks dashboard

FreshBooks is one of the top Xero alternatives in the market. What makes FreshBooks stand above the competition? To start, it is a fast and reliable accounting solution that makes financial management a fun activity.

Businesses benefit as they can easily manage recurring subscriptions and invoices, and collect online payments using this single system as it facilitates credit card, PayPal, and Google Checkout payments. Plus, it integrates smoothly with leading business applications to streamline this process. The vendor also offers a great free trial plan if you’d like to try out the key features first.

FreshBooks

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You can unite financial control with this single platform, which means you don’t need to invest in multiple software solutions. To give you more options, we provide viable FreshBooks alternatives here.

Why use FreshBooks instead of Xero?

  • The latest version offers advanced features.
  • The interface is modern and attractive.
  • The dashboard has been redesigned to facilitate effortless customization.
  • The vendor offers secure backups to keep your data safe.

Why use Xero instead of FreshBooks?

  • It allows editing on the go.
  • You can edit purchase files in seconds.
  • It offers readymade templates to save your time.
  • For every transaction, there is a detailed list of performed actions including dates, users, and manual notes.

Detailed FreshBooks Review

2. NetSuite ERP

NetSuite ERP dashboard

NetSuite ERP is a comprehensive and scalable cloud ERP product designed for the needs of fast-growing small businesses as well as large enterprises. The app automates front- and back-office processes including: inventory management, billing, order management, fixed assets, revenue management, and financial management. Plus, it enables all employees from top managers to clerical staff to view customizable reports on key performance indicators for their role. Finally, this ERP module integrates smoothly with other NetSuite software such as eCommerce, CRM, inventory, and order management tools. If you wish to look at more options, read about viable NetSuite ERP alternatives here.

NetSuite ERP

NetSuite ERP

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Why use NetSuite ERP instead of Xero?

  • It offers a complete set of inventory management, manufacturing, and purchasing features.
  • NetSuite ERP provides an insightful, real-time look at important supplier, inventory, and procurement indicators.
  • It offers self-service capabilities for partners.
  • Its order and billing management module integrates your sales, finance, and fulfillment operations.

Why use Xero instead of NetSuite ERP?

  • It allows editing on the go.
  • You can control purchase orders and categorize your invoices.
  • It offers standard reports including cash flow records, income statements, and balance sheets.
  • Its Management Reports show the full picture of the company’s profitability based on ROI and cash flow observations.

Detailed NetSuite ERP Review

3. QuickBooks Online

QuickBooks Online dashboard

This web-based accounting solution is created for small businesses, independent accounting firms, and freelancers. QuickBooks Online provides all essential accounting tools in a single platform to help growing businesses and firms simplify their accounting and finance management processes. This application offers robust tools that automate data collection and tax calculation, as well as features for simplifying billing and invoice management, sales monitoring,  generating customized reports, banking data synchronization, and more.

QuickBooks Online

QuickBooks Online

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QuickBooks Online is also accessible on multiple devices and is equipped with auto-syncing options so you will be up to date no matter what device you are using. If you want to find similar software, you can check out QuickBooks Online alternatives.

Why use QuickBooks Online instead of Xero?

  • All-in-one accounting platform for small businesses and freelancers.
  • Offers synchronization options for your data.
  • You can generate customized profit and loss reports.

Why use Xero instead of QuickBooks Online?

  • You can control purchase orders and categorize your invoices.
  • It provides feedback on your financial operations.
  • Its financial reporting feature summarizes the effects of all your activities.

Detailed QuickBooks Online Review

4. Sage Business Accounting Cloud

Sage Business Cloud Accounting dashboard

Formerly known as Sage One, Sage Business Accounting Cloud is a leading accounting software solution designed especially for small businesses. It provides users with automation tools and modules for invoicing and remote access. The product is also for its robust financial management and reporting features including drill-down and report designer module.

Other key features include billing, payments support, bank connections, bank reconciliation, stock management, accounts receivable, and accounts payable. Moreover, the product has multi-currency support for international operations.

Sage Business Cloud Accounting

Sage Business Cloud Accounting

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Sage Business Accounting Cloud is not just accessible via the web on your PC but it also has native mobile applications for Play Store and App Store so you can manage your business on the go. If you want to find similar platforms, you check out other Sage Business Accounting Cloud alternatives.

Why use Sage Business Accounting Cloud instead of Xero?

  • If you have a small business, the platform is built just for it.
  • The product is also designed for freelancers and service providers.
  • It has an easy-to-use report designer module for custom reports.

Why use Xero instead of Business Accounting Cloud?

  • The product is more scalable.
  • It processes and runs payrolls, and automatically adjusts taxes for more than 20 states.
  • It offers excellent inventory and stock management features.

Detailed Sage Business Cloud Accounting Review

5. Tipalti Approve

Tipalti Approve dashboard

Tipalti Approve is a great alternative to Xero for procurement. It provides users with better tools for processing purchase orders, goods received, and purchase approvals. Like other top applications, it has a centralized communication module for better collaboration and keeping employees on the same page.

Other key features include smart view filters, email notifications, and request duplication to avoid redundant manual entry. Moreover, Tipalti Approve is also valued by its users for having a good vendor onboarding feature. This allows users to build and foster great working relationships with their suppliers.

Tipalti Approve

Tipalti Approve

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The solution is also mobile-ready. Thus, key signatories can use their phones to approve purchases even while they are out of the office. Moreover, the platform integrates with other business tools including Slack, Okta SSO, NetSuite, and Gmail among others. If you want to find similar platforms, you check out more Tipalti Approve alternatives.

Why choose Tipalti Approve instead of Xero?

  • It has specialized procurement features.
  • The product has mobile approval for purchases.
  • It provides a good vendor onboarding module.

Why choose Xero instead of Tipalti Approve?

  • Xero has better financial management options.
  • It is made especially tailored to meet the needs of accountants.
  • The platform is more well-rounded than Tipalti.

Detailed Tipalti Approve Review

6. AvidXchange

AvidXchange dashboard

AvidXchange is a cloud-based solution developed to help businesses of all sizes handle their invoice management and payment automation needs. With it, users get access to digitized invoicing, purchase order automation, as well as approval workflow management. It even comes with a highly configurable interface that makes it easier for users to customize it according to their accounts payable requirements.

Aside from the abovementioned features, the platform also comes with pay services, bank reconciliation, and a supplier portal. With these, it is easier to make sure that all transactions with vendors are completed on time. Plus, as the platform uses the latest security features and fraud detection systems, it can ensure that all of your transactions are legitimate. Should you want to learn more about this platform, be sure to schedule an AvidXchange demo.

AvidXchange

AvidXchange

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The software is web-based, making it easy to access from any computer device that is connected to the internet. Moreover, the platform supports over 180 integrations so you can be sure that it easily blends well with your existing software ecosystem. To give you more selections, we provide good AvidXchange alternatives here.

Why use AvidXchange instead of Xero?

  • The app is flexible enough for CPAs as well as non-accountants.
  • It goes beyond accounting and includes tools like supplier portals and invoice accelerators.
  • The product can easily accommodate the accounts payable needs of large enterprises.
  • It provides fraud detection features.

Why use Xero instead of AvidXchange?

  • It offers ready-made templates to save your time.
  • Its financial reporting feature summarizes the effects of all your activities.
  • You can use the reporting feature to filter important transactions per category.
  • It offers excellent inventory and stock management features.

Detailed AvidXchange Review

7. Rossum

Rossum dashboard

Rossum is an all-in-one document gateway built to automate document management between businesses and their partners. Equipped with self-learning AI technology and cognitive data capture, this platform aims to accelerate data entry while minimizing the risk of human error. This platform is also built to be fully configurable so you can create custom approval rules for your accounts payable documents and other accounting files.

As it is a document management system at its core, the platform serves as a unified repository for all your accounting documents. It comes with a search engine that makes it easy to retrieve any transaction data. Plus, it tracks the usage of all documents so you can keep a close eye on who accesses your files. Plus, the platform can seamlessly integrate with your existing software ecosystem so you don’t have to worry about compatibility. For more options, browse these good Rossum alternatives here.

Rossum

Rossum

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Why use Rossum instead of Xero?

  • It is equipped with a self-learning AI engine.
  • It is compliant with HIPAA and other data security standards.
  • Users can accelerate data entry with its cognitive data capture and extracted data matching.
  • The platform has instant transaction status updates.

Why use Xero instead of Rossum?

  • It offers standard reports including cash flow records, income statements, and balance sheets.
  • You can also generate highly specific reports that tackle sales per item, expenses per contacts, aged payables, and other details.
  • You can use the reporting feature to filter important transactions per category.
  • The Business Performance tool tracks equity ratio debts and net value per sale.

Detailed Rossum Review

8. A2X

A2X dashboard

A2X is mainly a cloud-based ecommerce platform that has great financial management and reporting tools. It is a great alternative to Xero for companies with heavy ecommerce operations. It has a great inventory management tool and great integrations with customer-facing services like Shopify and Amazon. Thus, it can be an end-to-end solution for ecommerce businesses.

Other features include a general ledger, inventory accounting, transaction history, cost of good functionality, financial reconciliation, and supports multiple currency transactions. Moreover, you can also have multiple seller accounts to keep operational channels separate while having an integrated view.

A2X

A2X

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The product integrates with other business and accounting platforms like Amazon Pay, Sage, QuickBooks Online, and Walmart Marketplace. If you need to find similar ecommerce platforms with great accounting tools, you can check out A2X alternatives.

Why use A2X instead of Xero?

  • If you are an ecommerce business, A2X provides you with specialized end-to-end support.
  • It has integrations with customer-facing and fulfillment channels like Amazon, Walmart Marketplace, and Shopify.
  • Accounting features are specialized for ecommerce.

Why use Xero instead of A2X?

  • Xero integrates with other ecommerce business solutions.
  • It has better all-around financial management tools.
  • Xero is more flexible and customizable for any type of business.

Detailed A2X Review

9. Trolley

Trolley dashboard

Trolley, formerly Payment Rails, is an accounts payable (AP) software designed for companies with medium to high-volume accounts payables. It is also designed to scale with a business as it grows. It is not only popular among large enterprises but also SMEs. Key features include a recipient portal, PayPal payouts support, and bank account validation.

The platform also offers low FX rates to more than 135 currencies. Also, it has AML and Compliance Watchlist screening as well for better security. It is also prized for its automated tax form collection and reporting features. Plus, it has customized approval workflows to make teh whole AP process more efficient. The product is perfect for businesses that want to take their operations to the international stage.

Payment Rails

Payment Rails

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Trolley also integrates with accounting and ERP platforms. Other integrations include Trello, SurveyMonkey, Harvest, HubSpot, and Zendesk. If you want to compare Trolley with other similar products, you can check out Trolley alternatives.

Why choose Trolley instead of Xero?

  • It is designed to help businesses grow internationally.
  • The product is specially designed for accounts payable processes.
  • Trolley has low FX rates and supports more than 135 currency transactions.

Why choose Xero instead of Trolley?

  • Xero can handle AP with built-in tools and integrations but it is more well-rounded.
  • It has inventory management capabilities.
  • The platform has better all-around financial reporting tools.

Detailed Payment Rails Review

10. DocuPhase

DocuPhase dashboard

DocuPhase is an accounts payable automation solution providing document management features and other capabilities that are usable for the entire organization. It can act as a worthy alternative to Xero because of its strong accounting automation system.

DocuPhase

DocuPhase

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Because of its Optical Character Recognition feature, it can read the text on scanned documents accurately. On top of that, it has a document storage system that can keep invoices, receipts, and related financial documents. Thus, there is no need to worry about losing a single bit of data.

DocuPhase can also help with the digitization of a company’s processes with other automation workflows. For example, it can automate payments of invoices. Since it is a programmed action, organizations can rest assured that their dues are paid on time.

You can also compare the software with these DocuPhase alternatives.

Detailed DocuPhase Review

Why use DocuPhase instead of Xero?

  • DocuPhase’s AP automation is a time-saving feature that removes the stress of dealing with redundant tasks.
  • Its OCR capability can read receipts with high accuracy so you can expect correct information in fields and forms, thus reducing manual data entry.
  • The software has other sets of tools such as document management that teams other than the accounting department can take advantage of.

Why use Xero instead of DocuPhase?

  • You can edit purchase files in seconds.
  • It provides feedback on your financial operations.
  • You can generate highly specific reports that tackle sales per item, expenses per contact, aged payables, and other details.
  • It processes and runs payrolls, and automatically adjusts taxes for more than 20 states.

What is the best Xero alternative for you?

Xero is a well-rounded and easy-to-use accounting platform that is scalable, feature-packed, and priced reasonably well. It does not only track finances but also projects and inventories. So, it is really a good go-to platform.

The problem, however, is that it can be too general or broad for a business’s needs. Some companies only need accounts payable software, ecommerce businesses want ecommerce tools with robust accounting modules. So, they are better off with more specialized products like Tipalti Approve.com or Trolley.

But, if you want to compare Xero side-by-side to any product. The best alternative is FreshBooks. Firstly, it is far superior when it comes to its feature list. It has modules for online invoicing, expense tracking, time tracking, project management, payments support, and accounting reports and taxes. Many companies use it as an all-in-one business solution. And, that is something that Xero could not provide on its own.

If you are new to cloud-based accounting software tools and you want to know more, you can check out our more in-depth analysis of what accounting software solutions are and their benefits.

Lastly, to keep yourself updated with the accounting software market and profession, you can also check out the latest accounting software trends for 2022.

Daniel Epstein

By Daniel Epstein

Daniel Epstein is a senior financial research analyst at FinancesOnline and the architect behind our Fintech and ERP content division. His main areas of expertise are blockchain technologies, cryptocurrencies, and the use of biometrics in fintech solutions. His work has been frequently quoted by such publications as Forbes, USA Today, Entrepreneur, and LA Times. With more than 1,800 solutions scrutinized in the last 5 years spent on our team he always prioritized offering readers an unbiased perspective on modern financial technologies.

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