MYOB vs XERO Which Software Is Better For Your Small Business?

MYOB vs XERO – Which accounting software is better for your small business? The technology for the accounting industry has come a long way over the years. The methods have evolved momentously with the introduction of computers and the Internet. The most recent advancement to accounting software has been the introduction of cloud accounting. Think of 'The Cloud’ as an online server that allows you to access your data anytime you need it without having to physically store that information on your computer. Have you used Gmail, Dropbox, or Outlook? then you have experienced cloud technology. Prior to the introduction of cloud-based accounting, the prevailing player in accounting software for Australian businesses was MYOB. Feeling that traditional desktop accounting software had become outdated, New Zealand tech entrepreneur Rod Drury founded Xero in 2006 – a cloud-based accounting software company for small and medium-sized businesses that have since dwarfed MYOB’s market share, almost doubling its subscriber base in the space of 10 years. MYOB is now playing catch up, and over the last few years has released their own cloud-based offerings for small business owners; MYOB Essentials and MYOB AccountRight to compete with the Xero juggernaut. So how do the two major cloud-based accounting software companies compare head to head – MYOB vs XERO?

Comparing MYOB and XERO

Which accounting software will best suit your small business? MYOB or XERO? Whichever software you decide to choose, rest assured that they both are powerful solutions that provide an easy way to manage your accounting.

MYOB

XERO

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Cost

Essentials$25/mo starter$40/mo payroll for 1$50/mo unlimited payrollAccountRight (Windows only)$61/mo standard$92/mo plus$121/mo premier

$25/mo starter$50/mo standard$60+/mo premium (includes auto superannuation and payroll for 5 people – higher monthly cost for more payroll staff $100/mo for 100 people)

Xero. Although both companies provide comparable price ranges, consumers might feel overwhelmed with the amount of options MYOB offer. We therefore award Xero as the winner with the most straight forward pricing structure.

Signup & Installation

Fast and easy sign up process online. For more advanced features like inventory and job management, dedicated software is required and is only compatible with Windows.

Fast and easy sign up process online.

Xero. For startup businesses or sole traders it’s a tie. However if your small business requires more advanced features, then Xero is the winner as it does not require any additional software.

Number of Company Accounts

Up to 2 company accounts with the Premier AccountRight subscription

1 per subscription

MYOB has the slight advantage here allowing up to 2 company accounts with the Premier AccountRight Subscription (which also happens to be the most expensive). Each additional company account with Xero will require a brand new subscription.

Access

Essentials available on both PC and Mac.AccountRight only available for PC.

Available on both PC and Mac.

Xero. MYOB’s more advanced features are limited by software that needs to be installed to your computer and is only Windows compatible.

Mobile App

User interface is a little clunky.

Fast, responsive and intuitive.

Xero.

Invoicing

Send invoices from MYOB. Customizable invoice layouts. Advanced customization available only using AccountRight. Track when recipients open invoices.

Send invoices from Xero. Customizable invoice layouts. Track when recipients open invoices.

Xero. Customization is slightly more flexible.

Payroll

Essentials’ first 2 plans provide payroll for 1. $50/mo essentials plan has unlimited payroll.AccountRight plans have unlimited payroll except for the lowest $61/mo plan that has no payroll functionality.

Starter and standard plans only provide payroll for 1. From $60/mo you can get payroll for 5 people (higher monthly cost for more payroll staff $100/mo for 100 people)

MYOB. At the same price point of $50/mo, MYOB essentials offers unlimited payroll over Xero standard.

Reporting

Reports run one at a time.

Fast reporting with multiple reports able to run at once.

Xero.

Inventory

Essentials includes basic inventory tracking.Only AccountRight provides advanced inventory/job tracking and management.

All plans include basic inventory tracking and management. Allows third party integrations for complex inventory.

Xero. Despite MYOB offering powerful inventory tracking tools, it is only accessible on the computer which the AccountRight software is installed on and hence not compatible with Mac. Furthermore, Xero’s integrations with third parties allows it to be more flexible and specific to the users needs.

Employee Login

MYOB essentials includes ‘Your Pay’ which allows staff to enter timesheets, request leave and view payslips.MYOB AccountRight includes no employee login and is only available as a paid add-on.

Includes ‘My Payroll’ which allows staff to enter timesheets, request leave and view payslips.

Xero. The lack of an out of the box employee portal for the higher end MYOB AccountRight range is a detriment.

EOFY Data Rollover

MYOB Essentials data is perpetual, no need to close or rollover the financial year.MYOB AccountRight, closing the financial year requires 2 separate data rollover functions – one for Accounting and one for Payroll. If EOFY rollovers aren’t completed for at least the prior year, then creating reports for the current FY is disabled. (For example if you hadn’t closed off FY2015, then you wouldn’t be able to create FY2017 reports.)

Data is perpetual, no need to close or rollover the financial year.

Xero. The rollover process and requirement for AccountRight is cumbersome to say the least, especially with large data files. It is a process that is not easy for users, many of whom end up requesting hours of assistance from their accountant.

Foreign Currency

Not available.

Multi-Currency support available on the Premium subscription. FX rates calculated in real time.

Xero.

Online Support

Training Videos, online Community, online documentation.

Training Videos, online Community, online documentation.

Xero. A close one but due to Xero’s simple tier structure, understanding help and support is much easier than MYOB with its fragmented product range.

Phone Support

9am-5pm 7 days.

None.

MYOB.

Our Conclusion

At the end of the day, both accounting platforms should be able to provide most small-medium businesses with the accounting tools necessary to run a business. One major question small businesses need ask when selecting an option is “what does my accountant use and recommend?”. If your accountant recommends and is certified with a particular accounting platform, then using another software will make communicating data and getting support more difficult. By using the platform your accountant recommends you are ensuring a smooth experience when it comes time to work with your accountant. Business is already stressful enough without worrying about the paperwork and data, so it is highly recommended to streamline collaboration where possible. Xero remains the dominant leader in the Australian market for cloud accounting software with MYOB trailing second. As the first mover in the online cloud accounting space, Xero has been built from the ground up as a slick and responsive accounting tool for any user. Xero’s strength lies in its ability to complete the fundamentals very well – and its flexibility lies in its ability to connect with over 400 third party integrations which can enhance Xero’s capabilities to suit the needs of almost any small-medium business. MYOB’s products offer a range of similar features to Xero, however, MYOB still has a long way to go to create a user experience as polished and as fast as Xero. To find out more about Xero and if it would be a good fit for your business please get in touch with us to book a free no obligation consultation. We are certified partners with both software companies and can help you implement Xero or MYOB into your business and offer migration services if you’re looking to swap from a different accounting software.