Xero vs NetSuite
You’ll find that basic accounting software has clear limitations as your firm grows and your accounting needs become more complex. We are comparing Xero vs NetSuite because employing various tools augmented by spreadsheets to address the business difficulties that develop as you expand is not sustainable.
If you’re thinking about changing your accounting/business management system, you should first determine whether Xero and NetSuite both satisfy your present and future business needs. You should consider whether features and functionality will allow greater efficiency and scale if you want to automate important business operations, boost productivity, and cut operating expenses.
There is a substantial gap in the breadth of functionality and scalability between NetSuite and Xero, two companies that both provide software to assist businesses in managing their accounting and financial procedures. We’ve compared Xero vs NetSuite below so you can decide which platform will serve as the finest long- and short-term foundation for your business.
Xero at a Glance
Many small firms, especially those in Australia, New Zealand, and Southeast Asia, begin with Xero. Thanks to its low cost and cloud accessibility, it is frequently the first significant software purchase for many small firms. Xero addresses cash flow management, which is the main issue facing the majority of small businesses. Xero allows to see the financial health of your company, and business owners can use automatic bank feeds with a range of financial institutions to keep track of their income and expenses. Businesses can utilize Xero to automate the tedious work of preparing their tax submissions.
Accounting is the main focus of the cloud-based program Xero. It does offer some project capabilities and some basic inventory monitoring, but it mainly relies on third-party programs for sophisticated features and operational automation that don’t integrate well. Before finance teams can analyze indepth company reports, data must be available in spreadsheet format.
NetSuite at a Glance
The cloud-based platform of NetSuite’s financial management system offers real-time data with customizable fields and role-based dashboards to support organizations along their growth path. Beyond only accounting, NetSuite offers a full range of company solutions. These provide businesses with everything they need, such as customer relationship management (CRM), e-commerce, professional services automation, and more, to boost business and operational efficiency. It gives data in real-time and needs no additional IT infrastructure because it is on the cloud.
By facilitating automated quote-to-order fulfillment, cash flow monitoring, and revenue management, NetSuite functions as an end-to-end accounting solution. Beyond simple accounting and bookkeeping, it offers functionality that lessens the need for additional staff. It manages your complete business, regardless of whether you operate from a single location or have branches and subsidiaries all over the world.
Xero vs NetSuite: Product Comparison
Some small businesses find that Xero works well for them when it comes to managing simple accounting and bookkeeping tasks like managing invoices, paying bills, and very simple cash flow tracking. Producing month- and year-end reports and assisting with annual business taxes are sufficient when accounting requirements are on limits. Customers of Xero use third-party application add-ons to increase the functional capabilities of Xero if they need more. Although doing so increases application and integration complexity. Additionally, because Xero does not support many subsidiaries merging financial accounts for reporting is labor- and time-intensive.
In comparison, NetSuite provides a comprehensive financial management solution that boosts productivity and lessens the need to hire more staff as the financial needs of the firm become more varied and complex. NetSuite offers preconfigured KPIs, business process workflows, reminders, and customisable dashboards that quickly show how operations and accounting processes, such as inventory levels and P&L, impact each other and what tasks need to be completed. These features go beyond providing basic accounting information. Companies that operate in many regions and/or languages, as well as those with multiple subsidiary firms, can all use NetSuite. It provides unified reporting in real time, automates currency changes, and takes into consideration various tax rules.
More Differences
Businesses configure and customize NetSuite to meet the unique requirements of their operations. Additionally, developing organizations must deal with increasing levels of governance and compliance, whether it’s mandated by law, demanded by investors or a board, or necessary for an IPO. A company using NetSuite can swiftly produce statements and disclosures that satisfy numerous financial regulatory obligations as well as investor requests for information.
NetSuite is aware that when companies expand, they no longer view operational and financial management software merely as ‘tools,’ but rather as strategic investments that support their corporate goals. These companies are seeking a relationship that will enable them to accomplish their objectives. Through committed customer managers, NetSuite not only offers a wide range of functional and technical support, but also invests in each customer’s long-term journey. The sole language supported by Xero is English, and all requests must be made through an online interface.
Xero vs NetSuite: Revenue Recognition
With NetSuite, accounting teams can plan for automatic revenue recognition and adhere to revenue recognition regulations. This is true, whether a sales transaction entails a single activity or a string of actions spread out across time. Even maybe a range of deliverables packaged together. Financial accounts and forecasts are accurate and updated in real-time for viewing as needed.
This is helpful for Saas and service businesses that must recognize and defer revenue at various times in time. Probably due to multiple deliveries (such as ongoing services, updates, or extra licenses). Since Xero does not natively offer revenue recognition, a third-party tool or workaround is needed. These invariably result in time-consuming processes for firms, including cumbersome recognition schedule spreadsheets and hazy or nonexistent forward-looking data or insights.
Xero vs NetSuite: Fixed Asset and Lease Management
Xero does not have lease/rental management features. However, it offers some basic fixed asset management functionality (which is limited to the number of assets under management).
With NetSuite, your organization can easily report on all fixed assets and manage the entire asset lifetime. You can keep track of both depreciating and non-depreciating company assets from creation through disposal. By doing this, it will be simpler to keep track of all capital assets. This includes their status and acquisition costs, and to document that information accurately. The new accounting and reporting standards for leased assets are also addressed by NetSuite’s solution. The focus is setting up amortization schedules and separating interest expense from rental expense. Especially for reporting purposes on both balance sheets and income statements and supports multiple accounting treatments.
Xero vs NetSuite: Inventory Management
The inventory management tool from NetSuite allows businesses real-time access to their stock. Automatically tracking inventory levels, orders, and sales throughout the inventory lifecycle. This lowers the need for human operations and offers the most recent information needed to make data-driven choices. Businesses benefit from increased sales and operational management as a result. Aside from inventory counting, pick, pack, and ship, integrated barcoding, and multi-order picking, the system also offers warehouse management tools.
Although Xero provides straightforward inventory monitoring, the majority of businesses also need a third-party inventory management program.
Xero vs NetSuite: Reporting
Standard accounting reports are available with Xero. This includes cash flow, balance sheet, aged payables and receivables, payables and receivables, and profit and loss. Xero also allows for some simple customization.
In contrast, NetSuite offers a wide selection of common financial reports. These reports can be easily customized to view particular GL account types and transaction fields. This feature includes custom field values as they are recorded on transactions thanks to their high flexibility. Advanced financial management, including budgeting and forecasting. As well as reporting on intricate business models are all included in NetSuite reporting. These are businesses that have numerous subsidiaries, operate internationally, or use a multitude of currencies and tax systems.
Consolidated reporting is available immediately rather than having to wait until month-end close since NetSuite constantly consolidates.
Additionally, NetSuite makes it simple to drill down and across records in the system for extensive reporting. With configurable views for reports from departments, locations, product lines, and a variety of operational viewpoints. NetSuite reports do away with static reporting.
In Conclusion:
When deciding whether to upgrade, your company must take into account scalability, future ambitions, and existing and future needs. Xero or NetSuite might be a viable option now. However, will it be able to handle the demands of your growing company?