- “You’re Welcome” In standard
In our previous post we talked about how companies feel they are outgrowing QuickBooks, but in many cases they are either outgrowing their accounting processes or they just don’t know what QuickBooks can do.
So what are your options if you are outgrowing QuickBooks—and at what point do you need to consider going to an ERP (Enterprise Resource Planning) system or a mid-market General Ledger package like NetSuite or Great Plains?
You may want to consider another system beyond QuickBooks Enterprise if the following apply:
- You need more than 30 simultaneous users
- When you have more than 100,000 accounts in your Chart of Accounts
- You have more than 100,000 items in your item list
- You have more than 100,000 employees, customers, vendor combined
- For a complete list of limitations click here
Moving to a mid-market system:
Assuming that your needs fall beyond the limitations of QuickBooks, you may want to consider some of the things you will encounter if you move to a mid-market system:
- The data isn’t yours—for the newer cloud-based mid-market systems like NetSuite and Intacct the data resides in the cloud. So when you decide to end your subscription your access to your data, and your history ends as well. Yes, you can download tables, but you will never be able to piece together transactional level history like you would on a server-based system.
- The price tag easily reaches $100K for implementation & maintenance. The first year of implementation can be quite costly. Often times you need a mid-market consultant to design and implement a system to work for you. Ongoing maintenance costs for server based subscriptions can be in the tens of thousands of dollars. (QuickBooks annual fee is $3,000 for comparison.)
- Fully customizable… for a price. If you don’t like the way something functions out of the box, most mid-market systems can be customized—if you want to pay a consultant to do that for you.
- You’ll need different internal accounting support. If you have been functioning with a bookkeeper or accounting manager, you may need to step up your internal support to include a Controller or someone who will be an administrator for the system. Whereas (for better or worse) you can undo transactions in QuickBooks. When you move to mid-market systems you have to batch and send transactions.
- Reporting requires another level of sophistication. Some reports come “out of the box” however with some mid-market systems you need 3rd party reporting tools such as Crystal reports and you cannot drill down to the transactional level detail from the report. This is often a surprise for those used to the many automatic reports and functionality in QuickBooks.
- Limited integration with 3rd party systems. Generally speaking, mid-market systems require some programming to integrate with other systems, whereas QuickBooks has many systems that have built-in integrations to the software.
Consider a Hybrid approach:
We have worked with companies that have complex planning, scheduling, and invoicing needs. Many times those companies use industry-specific systems that help them handle their front end operations. However, our experience has been that these systems do not have very good General Ledger modules. Because they don’t focus on the financials, the reporting and analysis is limited. We often recommend companies looking for industry-specific ERP systems determine if those systems integrate or feed information into QuickBooks.
Sometimes companies do outgrow QuickBooks. Sometimes they do need more robust planning and scheduling tools and other functionality that QuickBooks or the add-ons just aren’t able to provide. Transitioning to a mid-market system isn’t for the faint of heart or cash-poor business. It’s best to go in with your eyes open and consider a hybrid approach.
What have been your experiences with transitioning to a mid-market system?