Xero review – 3 months post-implementation
I wrote an entry on Xero vs MYOB 3 months ago explaining why our business changed over to Xero, which brought heaps of traffic to the Euroasia blog. Perhaps it had something to do with Computerworld linking to us…
In this entry, I will discuss our experience with Xero over the last few months, and some of the improvements that could be made to the system to make it work better for SMEs. I googled Xero reviews prior to implementing the system, and found that the reviews out there are invariably written by computer geeks, who by and large were mesmerised with the interface/design as well as how solid the systems architecture is. As for me, I’m only interested in using the system to keep track of key business measures and how much time our organisation saves on accounting tasks.
It doesn’t matter how sophisticated or cool the system is, as long as it generates superior ROI, it’s all that matters. I won’t go into the details as to why Xero is better than MYOB, as that has been covered already.
I’m biased. I prefer to operate in the clouds, and if possible do all my work within the browser. This is a key reason why Xero appealed to me. Upon deciding to go with Xero, I hired Penny Smith from Penny’s Worth to help with the implementation. The implementation was straightforward, and Penny gave me some key instructions on getting the opening entries right so that the balance sheet is aligned. In fact, you can set up an adviser to access your system remotely, without having to pay for them to come to your office. Another key advantage ordering cialis online of using Xero. Penny can get it all set up for you remotely. I met her at a Xero function a year ago, when Hamish Carter talked about the virtues of Xero. It’s a smart move for Xero to have Hamish Carter on-board, as he’s funny, and not a beanie or a geek. I recall the businesspeople in the room seemed to like his style, a welcome departure from the overly technical approach of the usual accountants or programmers.
So far, Xero has worked really well. In terms of measurements of key metrics, I think the dashboard is pretty good. It gives you a bird’s eye view of your financial standing, updated every day by automatic feeds that comes through from our bank. My advice is that you should get the bank feed set up first, as it takes about 2 weeks to get this approved. Once the bank feeds start coming through, reconciliation is easy.
The reports are excellent. You can customise what you want, and basically come up with professional-looking management accounts that in the past you would have to pay an accountant hundreds of dollars a month to produce. You can also access your reports anytime, whereas if you’re reliant on someone else producing reports, you won’t be looking at data in a timely manner. This is especially critical in recessionary times, when managers are spending more time looking at key metrics on a regular basis.
Businesses spend a lot of time monitoring debtors, which is why I’m glad to see that the debtors interface is really good. You can even specify expected payment date (which is often after the invoice due date) and make notes on when customers are expected to pay. You can also keep a log of calls made to keep better track of debtors. Specifying an expected payment date is a good business discipline, because it forces you to think about cashflow as opposed to just billings. The more time businesspeople spend on ensuring the debtors are up to date, the more accurate the cashflow projections and more importantly, this translates into real cashflow.
I also like the fact that Xero is pretty responsive. Don’t forget that the monthly fee of $49 + GST includes customer support, and from my experience they have been pretty good with responding to my few support requests. They have also recently introduced multi-currency, which is a great feature.
2 weeks ago, Xero went down for about an hour. Of course, it is a business nightmare to have the accounting system go down. One of the reasons I said I liked Xero is because it’s reliable. NBR said that “One of the drawbacks of cloud computing was dramatically illustrated…” by this outage. Did I change my mind because of this problem? No. For the simple reason that the same thing could also happen to MYOB. If our server failed, we would also lose MYOB, and would have to spend time manually restoring an old version, and pray and hope that we remembered to back up before the server died. All up, I’m sure it would take
more than an hour to get everything up and running. I’m confident that on balance, we’re much better off having our data hosted by Xero than on one of our desktops.
However, our Xero implementation wasn’t without hitches. We had some dramas at the end of the 1-month trial period. I forgot to confirm payment details prior to the end of the trial period, and as I was away when the trial period ended, I received some frantic messages from a colleague who couldn’t access the system to raise an important invoice that had to go out ASAP. If you intend to stick with Xero after the trial, do get your credit card payments set up beforehand. I thought Xero could have sent reminder emails in the days leading up to trial expiry so that users can get it all set up should they wish to continue with Xero and not just cut off access abruptly.
On that note, I will talk about the things than Xero can improve on.
The other problem we have is that we can’t specify the name of a contact person for a company. In the name field, all you can do is to enter the name of the company. But often invoices are addressed to specific people within the company. We should be able to specify the name of the invoice recipient.
You see a snapshot of activity over recent months when you click on a contact, which is useful. But what would be great is a “news feed” of notes and other activities for that client. eg. when you sent invoices to that client.
There are numerous other things that Xero can do, which would be useful for SMEs. But this post is long enough as it is…
On an overall basis, Xero is a great system, with the pros outweighing the cons, and I would definitely recommend this product over MYOB (or for that matter any system that locks you to a desktop) any day. And the best part is they keep improving the product, so it can only get better, which is why the value proposition can only get more compelling for users.
Last year, in response to my question “Is there any reason why we shouldn’t switch to Xero?”, my accounts assistant responded “well, you’re stuck if they decide to up prices”. On that note, I hope Xero sticks to current pricing and do not squeeze us clients simply because they know how inherently sticky these systems are.
[UPDATE 12 October 09: MYOB vs Xero 6 months post-implementation]