A review of new software products for your business

What’s new with QuickBooks?

By Michael Burns

QuickBooks has been one of the leading small business accounting systems for years. Originally, it was designed for small businesses with no accounting knowledge. But as Intuit’s flagship product, it has now been updated with several new features, such as contact management, loan management, cash flow projection and a revised help function. The new version, QuickBooks 2005, shipped on September 2, 2004.

Before deciding what to include in the 2005 version, Intuit conducted extensive market research that included a product survey, visits with users to observe and interview, a conference with its ProAdvisors, and an analysis of tech support call logs, suggestion databases, and outbound calls to the user base. The changes should appeal to QuickBooks small business customers. But is QuickBooks also suitable for mid-market companies?

Target market
QuickBooks is targeted to small businesses with 1-20 employees. Customized versions of QuickBooks are also available for accountants, contractors, retail and repair businesses. The Accountants edition allows accountants to better manage their client files using Internet-based remote access. The other industry- specific systems are designed and set up specifically for those industries to manage their businesses more effectively.

QuickBooks 2005 supports five simultaneous users and includes many high-end features including multi-currency, custom fields, ability to break out financials by division or department, multiple price levels, and ability to buy, sell and stock inventory in different units of measurement. But there are maximum file sizes that might cause a problem for some companies. For example, you can have no more than 14,500 individual inventory items.

To meet the needs of larger organizations, Intuit launched its Enterprise edition in March 2003. This edition doubled the maximum number of simultaneous users to 10 and also doubled the maximum file sizes. Although the edition took off in the US, especially in the middle market, it was discontinued in Canada in July 2004. That may be because some people at Intuit considered Canada as a land of small businesses. More likely, the problem is with branding in the Canadian marketplace. QuickBooks has been held up as a small business solution, and it’s difficult to change public perceptions without extensive marketing campaigns. Also, Canadians are probably more conservative and a tougher audience. According to Intuit, “The typical QuickBooks customer is a small business with 20 or fewer employees and annual revenue of less than $2 million. The ideal use of QuickBooks is to keep at least two years of detailed transactions in a data file so that you can run comparative reports and have prior-year project information.”

Cost
Choose between QuickBooks Basic at $199.95, QuickBooks Pro at $349.95, QuickBooks Premier, or a QuickBooks Premier Custom Edition at $499.95. Here we’ll focus on the Premier edition, which is the only one that includes Customer Manager, Loan Manager and Cash Flow Projector.

New features
For QuickBooks 2005, the biggest enhancement is the inclusion of Customer Manager. Whenever a customer calls, Customer Manager gives a complete overview of that company’s information on a single screen with key documents easily accessible. The system allows you to view contact information, customer history, recent QuickBooks transactions, related documents, to-do lists and appointments. It integrates with QuickBooks and uses Microsoft Outlook for email. Customer Manager also includes the ability to maintain multiple relationships associated with each contact – a feature normally found in higher-end CRM systems. However, it would be better if QuickBooks allowed you to tag each relationship with the type of relationship. It could then be possible to run reports that could, for example, show how much business was attributed to a specific referral.

Like ACT, Customer Manager is a contact management system. It is not meant to compete with customer relationship management systems such as SalesLogix or Microsoft CRM, which also include other functions such as sales force and marketing automation. It is also a separate single-user system (not part of QuickBooks). You will need to synchronize to keep the contact information up to date. Also on the downside, there is no way to select contacts based on multiple criteria, no mail merge for multiple contacts and no report writer.

Although Customer Manager has its shortcomings, the average small business will probably appreciate the one-stop shop for customer information. And the product will become stronger with future upgrades.

Another enhancement is the Loan Manager, which helps track the loans that have been set up in QuickBooks. You can keep track of all your loans in one location and be reminded of upcoming payments. In the Loan Manager, you can add and remove loans you want to track, view payment schedules, set up loan payments, and analyse payment information for various loans, whether they be existing or prospective.

QuickBooks 2005 also includes a Cash Flow Projector, which uses the information entered in QuickBooks to provide a six-week view of all incoming and outgoing cash and will show any weekly cash excesses and/or shortages. You can compare the effects of increasing or decreasing cash receipts on your cash flow, see how increasing or decreasing business expenses will affect your cash flow, and view the impact of unpaid bills and their due dates.

Intuit has pulled out all the stops in trying to make it easy to get help. With what is called “Follow-me help,” QuickBooks automatically displays topics relevant to where you are in the program. You can enter a question and QuickBooks will first search the on-screen help system to find answers followed by searching the online knowledge base. QuickBooks will also show how to contact an Intuit representative or a professional advisor.

Bottom line
QuickBooks keeps getting better and will undoubtedly remain on the list of leading accounting systems for small businesses. Nevertheless, Intuit faces an uphill battle in winning over the middle market. It should relaunch the QuickBooks Enterprise edition with a marketing campaign showing Canadian accountants that it’s more than a small business product.

Michael Burns, MBA, CA, is president of 180 Systems (http://www.180systems.com), which provides independent consulting service, including business process review, business case development and system selection. Michael can be reached at 416-963-1296 or mburns@180systems.com.