Accounting is the process of documenting and verifying financial transaction s of a business. The process comprises of gathering financial data of the organization, analyzing and interpreting the gathered data to understand the financial proceedings of the corporation and reporting processed information to the management of the company and regulatory authorities for taxation and other related processes.
Accounting software is a genre of application software that facilitates the task of accounting; providing a number of tools for accounting, such as deliverables, payables, trial balance and payroll. The accounting software can be an in-house product, developed by a software firm to suit the requirements of the corporation or a third party software.
Freshbooks is widely popular among accounting software in the market that is used for accounting billing and invoicing (Lipi, Rama and Agaraj 2015).
History of Freshbooks
Mike McDerment was the owner of an internet design and consulting company based. The company, Anicon, had four employees. The company used the general tools, like Excel, to perform accounting tasks for the company and avail the functionalities of a spreadsheet application.. Owing to the file management structure used by these applications, McDerment inadvertently overwrote an existing invoice. Compelled by this accident, McDerment formulated accounting software to ease the tasks associated with the process and simplify the billing process. McDerment coded the application in a fortnight and named it 2ndSite. 2ndSite was a invoicing software targeted to meet the needs of small and medium sized enterprises (SMEs).
2ndSite proved to be useful and offered prospects of improving the accounting functions associated with business. McDerment worked with Joe Sawada and Levi Cooperman to develop the accounting software on a commercial scale. The product was developed in Toronto, based on Web 2.0 and was renamed in 2006 as Freshbooks. McDerment was able to provide a simple and reliable accounting product through Freshbooks (FreshBooks 2016).
Development and Adoption of Freshbooks
Freshbooks’ philosophy is based on three Es : Execute Extraordinary Experiences Everyday. The philosophy is integrated into every aspect of Freshbooks, encompassing its development, production, marketing, sales and customer support. The philosophy of “Execute” inspires the company to focus on the execution of well-formed ideas and consider execution of ideas as important as their development. The company believes in providing “Extraordinary” customer experience by delivering products and services that exceed the expectations of its customers. The company exploits its experience in the market and integrates that in their product. Experience aids in the improvement process. The company believes in delivering customer centric solution and support regularly, which aims at its philosophy of “Everyday” (FreshBooks 2016).
Development of Freshbooks
The company started as a three-person business and expanded to a well-established Canadian tech corporation, headquartered in Toronto Canada. Mike Mcderment, the Chief Executive Officer of Freshbooks, started the company in the basement of his parent’s house. The company possesses a global clientele, serving customers from 120 countries and over 200 employees. Over 10 million people use the product, invoices of $60 billion is paid through Freshbooks and Freshbooks saves 192 hours annually (FreshBooks 2016).
Adoption of technology by Freshbooks
Freshbooks is rapidly evolving and integrating technology to keep up with its philosophy. The software provides support a wide range of features that include expenses, invoicing, contact management, time tracking, client portal, and light inventory. The products support the automation of tasks that aids in time-consuming processes. The availability of cloud support increases the reach ability and availability of the product. The company is focused on the making the product available to mobile technology. The company recently introduced credit card readers that work with mobile devices to provide mobile transactions.
Current Market Size of Freshbooks
The services provided by Freshbooks is used by a wide variety of customers. The product offers functionalities that are used by freelancers, consultants, designers, IT professionals, lawyers, architects, web professionals as well as corporations. The services provided by the products helps to save a lot of time. According to the statistics of the company, Freshbooks saves over 192 hours annually, which is the result of its simplicity. The quantity of users of Freshbooks exceeds 10 million worldwide. The company states that invoices over $60 billion were paid using Freshbooks. The company offers the best cloud accounting solution for small business owners. The company has the largest paid subscriber base after QuickBooks in North America. The company is available in Twitter, Facebook, LinkedIn, YouTube and Pinterest. The products is available in German, Dutch, French, Italian, Spanish, Portuguese, Danish, Norwegian, Swedish, and Estonian. The company does not disclose company information; however, it claims to have a customer base over 5 million in over 120 countries (FreshBooks 2016).
Identification of the leaders in accounting software market
Accounting is an integral part of any business and expansion of businesses across Australia and worldwide intensifies the need. The growing need for flexible and optimized accounting has led to the development of accounting software from a number of organizations. Intuit QuickBook, Xero, MYOB, Freshbooks, Wave Accounting are just a few names in the accounting software market. Besides providing the basic accounting functionalities, each software offers a different feature that differentiates it from the rest of the products.
The quality of accounting software depends on a number of factors that includes cost, ease of use, reporting capabilities, accountant access, customer service, ability to save time and many more. Based on these criteria, Intuit QuickBooks can be identified as the best overall performer in the market, as the product offers a variety of features. The product has a wide user base and depending on the requirements offer features that extends from simple to advanced (Jones and Jones 2016). Wave Accounting is the best in the free accounting software domain. Xero is widely accepted by Mac users. Cloud solution and mobile app offered by FreshBooks is quite popular among users.
AccountEdge Pro, FreeAgent, GnuCash Free Accounting Software, Harvest, Hiveage are the names of a few other accounting software vendor.
Competitive Advantage of FreshBooks over other accounting software
The following features offered by FreshBooks makes the product stand out among its competitors.
Value for money
The timesaving tools available in FreshBooks makes the product a better choice among its competitors. The product offers a range of price models that makes it a viable candidate among users. The mobile app by FreshBooks can be downloaded free and the usage is free for the consumers who subscribe to the services of Freshbooks for a period. The software and the app can be used for a single subscription charge.
The software is accessible to and supports a number of devices. Downloading the app is effortless. The mobile app puts forward a clean layout that is intuitive and easy to use. The software gives users compact functionalities that is revered by its users.
Integration of PayPal
The product includes integration for PayPal, which eases the process of connecting the product with PayPal.
Time and expense tracking
The product offer features for the tracking of time taken for projects, which is used for calculation of hourly rate of projects or estimates the time consumption rate by projects.
Simplified payment process for recurring transactions
Apart from the regular billing procedure, FreshBooks offer the option to set up credit card merchant account, which simplifies the payment process (Forbes 2016).
Identifying the challenges and gaps in Intuit QuickBooks application
FreshBooks is considered to be a simple and user-friendly product by its user which led to its wide acceptability. Apart from a few hitches, the inventory control functionality provided by FreshBooks is crude and mimics the activities of a true inventory tracking system. This lack, however, is not a major concern for users who does not require inventory-tracking systems. It is expected that FreshBooks will be able to mend the gap.
The mobile app provided FreshBooks does not support Windows and Blackberry devices which presents a hurdle for the users of these devices.
The facilities presented by FreshBooks surpasses the minimal gaps presented by the products.
The company is self-sufficient and is able to conduct its operations quite successfully. The company was mentioned in the Forbes for the quality of services it offers.
The company offers an excellent customer service, however, the timings of customer services is fixed which hampers the usability of the product. The service is completely unavailable in the weekends, which affects its customer support. A regular customer support system will aid in the business growth.
The payroll functions in FreshBooks is available only through app integration. A product of the magnitude of FreshBooks should be able to support complete payroll functionality.
The management of past invoices is complex in the product and the user expects the rectification of the services.
Accounting process provides a profound base for the financial operations of the company. It is an integral operation of regular business functions of a corporation. The accounting process requires consistent effort and maintenance, including tasks that are monotonous in nature and are prone to errors.
In order to simplify the process of accounting, accounting tools are used. The accounting services ease the accounting process to an extent, where any non-financial person is able to perform accounting functions.
FreshBooks is one of the accounting software that offers cloud based accounting solutions and is a sought for product, owing to its cost, simplicity and usability. The product offers immense facilities for the user that includes a mobile app to support mobility.
The product is a strong contender in the accounting software domain and requires constant updating and incorporation of features to maintain its position.
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