If you ever plan to go to business, one of the key essentials is having some type of accounting system. A lot of small companies can get away with an excel spreadsheet, especially if it’s a one-person business. That being said, having an accounting system can help tremendously in a variety of ways.
Today we’re looking at one of the best accounting apps for e-commerce out there: FreshBooks. In this FreshBooks review, we’ll be breaking down the benefits and taking a detailed look into this system just to see what it has to offer. Many people have also claimed it to be the best bookkeeping app for drop shipping businesses as well, so we can see already that it’s used in a variety of businesses.
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Learn about the Freshbooks Expenses Dashboard
Pricing & Setup
FreshBooks follows a monthly subscription payment structure, with each level allowing you to invoice more clients. They go as follows:
- On the Lite plan, ($15 monthly) you can bill upwards of 5 clients.
- The Plus plan, ($25 monthly) allows you to bill up to 50 clients.
- Finally, the Premium plan, ($50 monthly) will allow you to bill 500 clients.
Naturally, this is on a monthly basis so depending on how many clients you get each month can determine what sort of plan is suitable for you.
As far as other features, each plan has all the same basic features, and you can also take a 30 day free trial on any level to see how it all goes.
When it comes to the setup it’s as simple as signing up on any website. You have your username and password as well as email. Once that is set up, you’ll have to setup the invoicing process. In this instance, you’ll have to input the supply company contact details as well as tell the system which industry you are in.
The industry option is most important as based on that the system will configure its display based on that. That’s not to say that you are restricted access to certain things, no. It just means that FreshBooks displays only context-sensitive settings on particular screens. This allows navigation to be a lot easier since it only shows what’s appropriate for you to be able to work. We’ll talk a little more on this point later.
Inside The System
Now that that is all set up let’s talk about the inner workings of the system. The prices as you can tell are pretty good for one of the best accounting apps for ecommerce businesses. Depending on how many clients that you deal with, this system can handle a lot of invoices with very little issues.
But what really matters with this FreshBooks review isn’t as much the price, but what exactly do you get by paying for all of this?
So let’s dive in.
An Improved User Interface
One of the big steps forward is an improved user interface. Upon signing up, you’ll be located in the site’s dashboard. The dashboard immediately provides a brief overview of the company’s financial position. From this dashboard, you’ll see three charts: outstanding revenue, total profit, and spending.
From the outstanding revenue, it shows you who owes how much and who is behind payments. Total profit naturally shows total profit or loss but in a real-time number. You can also change the date range from there too. Lastly, spending will show you your expenses by category.
Below those three charts will have links to the most common reports as well. Examples are Accounts Aging, Invoice Details, and Time Entry Details.
Unfortunately, you can’t really drill down on these like with other accounting systems like Wave, however, a lot of businesses are going for the look that you see here. This makes sense since it’s a habit for businesspeople to want a quick look at the overall performance of the company.
You can see why this is the best bookkeeping app for drop shipping as well as the best accounting app for e-commerce, as people can quickly review their performances.
But that’s not all the dashboard offers. The next thing is that there is a vertical pane on the left side of the dashboard. This is your navigational links. It makes sense for them to be there since a lot of westerners eyes gravitate to the left of the screen first before moving to the right. This makes navigating easy since the links display everything you need. It has a link for each of the following: Invoices, Clients, Estimates, Projects, Expenses, and Time Tracking. Clicking on the link below the company name will reveal a list of site settings you can adjust to your preference.
With the settings, you can contact support, add contractors or team members, as well as see billing info. You can also set up two connections which are quite critical to FreshBooks daily operations.
Furthermore, if you choose to use your login credentials with financial institutions where you have an account with, FreshBooks automatically connects to their site and imports account transactions. Not only that but you can also start accepting credit cards by using Stripe and connecting it with FreshBooks Payments (which you need to signup for). The only thing to keep in mind with Stripe is that fees apply in this instance.
You can also get notifications by clicking on the small bell in the upper left. You’ll get notifications when a client, team member or your business does something. There are also two drop-down arrows located on the upper right which allow you to add employees or contractors into the system (labeled Invite). The other arrow is called Create New which gives you a transaction list as well as records where you can input information directly there. This creates an entry for you quick and easy without having to use the navigational links on the left. Create New covers invoices, adding clients, making estimates, and recording expenses.
Overall, FreshBooks has a lot of things jam packed into it, but it’s also quite simple to navigate. In fact, this is one of the most simplistic and intuitive screen displays on bookkeeping sites that have been reviewed recently. This also includes Wave and Kashoo. The only real drawback to this system is if you used FreshBooks in the past it may take a little bit to get oriented again.
Regardless, the interface alone is impressive and I can see why it’s called one of the best accounting apps for e-commerce.
Next up is the creating invoices, which is the core of any bookkeeping app. You want it to be clean and simple, and FreshBooks offers just that. All of our choices are upfront and it’s so good that chances are pretty low that you’ll need to go for the Help function to see where everything is supposed to go.
To get to the invoice section you can either use the drop-down arrows and create an invoice from the Create New option, or you can click on the link on the left. There isn’t any difference between these two buttons as FreshBooks takes you to the exact same screen.
FreshBooks’ designers have also done a fantastic job organizing all the features into the software’s UI. From looking at the Invoice screen, you see a lot of information crammed in there. There’s even a toggle which allows you to see past invoices. This goes for invoices you’ve either created, sent out, or received and even paid. The reason why some paid invoices might be there is so that you can pass that cost over to a client and the invoice is there as a reminder.
From this screen, you are able to create invoices right there or you can generate them from Estimates that you created in the past.
The only thing to keep in mind is that you are billed based on how many clients you have. This is key as the fees from FreshBooks are actually based on how many clients you have in there and designate as active. This is important since you can be billed for the higher price tier if you add a client that exceeds your previous limit. For example, if you already have five active clients and you go to add another, you’ll be billed on the Plus plan rather than the Lite plan.
In other words, the system won’t tell you whether you exceeded your limit but at the same time, the system won’t prevent you from adding clients as necessary.
Going back to invoicing though, there are a few other features to look at as well. One of the smaller ones is customization. FreshBooks doesn’t offer much in customization, but it’s still nice to get the choice. There are two formats and you can choose between a variety of colour schemes. Furthermore, you can choose to add a logo or an image at the top of the form as well.
Some of the other more notable features are the access to Invoices Due as well as the ability to create proposals. With Invoices Due, you can determine the state of specific invoices. That is you can see whether the invoice is sent out or it’s still a draft. You can also see if the invoice was viewed or not, making following up easier in the event the customer hasn’t seen the bill. There is also the option to have reminders set for you to view the invoice at that time.
As for proposals, it’s a great tool because you can also send estimates as well even with proposals out there. With estimates, you are basically creating a quote. Once the quote is accepted you can easily change it into an actual invoice. With proposals, they are more detailed. They have narrative texts, tables, and easily span many pages. Proposals are essentially Statement of Work and once they are signed, they become contracts.
This is an incredibly rare feature since most bookkeeping apps often focus on the bare bones of billing and invoicing. It’s a pretty handy feature and can be used in a variety of situations.
Some other things to note is that customers can pay by using FreshBooks’ payment feature which costs them 2.9 percent plus an additional 30 cents for every transaction. That’s standard across the industry. Furthermore, sales taxes are handled easily. You can create different taxes at various tax rates. Once you do that you can add tax by adding a line item to the invoice and click on the rate you want. There is no limit to how many tax rates you can have and they are editable at any time.
While you are creating invoices, FreshBooks shows links to context-sensitive settings on the right side of the screen. This particular feature is unique to FreshBooks as a lot of other sites have a massive section of the site where they have this.
With this feature, you can do a variety of things. For example from the invoice section, you can change the invoice style or make invoices recur.
Furthermore, if you are using FreshBooks above the Lite plan, you can set reminders at various intervals as well as charge late fees.
Contacts and Expenses
Every small business accounting website has a section dedicated to this and FreshBooks is no exception. From the New Client button, you will see a graphical paper card display on the screen. From there you can easily add client name and other details with ease. That being said, FreshBooks goes a step beyond that.
One thing FreshBooks does is that it goes out of the way to find a picture or a company logo online that matches client contact info. This is a surprising feature since other sites don’t do this.
Also as usual when you click on a client from your client page, you’ll get a pop up of transaction history and past interactions.
As for expenses, we mentioned above that FreshBooks can extract data from a financial institution you are with. You can get revenue from there but of course, you can get expenses as well. FreshBooks is pretty good about expenses as well as the system automatically organizes each transaction for you. The only thing to watch out for is early on the system does miss the mark at times, however the system learns as you make corrections.
In the event that your business deal with projects, FreshBooks has a section where you are able to define them. From this section, you create a name for the project, assign it to a specific client or staff member, as well as place an hourly budget and end date. From there you have an option of setting a blanket billing rate. This can be set as a total or hourly rate.
You can also use this feature even in the event that you are the only person and you are charging one rate. Furthermore, you still allowed to add employees as well as contractors, who can input their own hours as well as share ideas within the project itself.
All in all this feature makes team collaboration easy, flowing, and productive.
To wrap things up, in this FreshBooks review I have to say I am impressed. It’s certainly worthy of the titles best bookkeeping app for drop shipping and best accounting app for e-commerce as it can pull its weight and provide to the industry quite well.
That being said, this new and improved FreshBooks still isn’t up to where it was before. If you were a FreshBooks Classic user in the past, moving over to this new version can be a bit jarring. Don’t get me wrong, the product is quality and even for a new user, the service is exceptional. That being said, if you are already using FreshBooks Classic, I’d suggest waiting a little longer as the system develops and adds those features that are missing in FreshBooks Classic.