FreshBooks Review: The Definitive Guide to this Invoicing and Accounting Solution
When it comes to accepting payments, invoicing, tracking and managing expenses online, nothing does it better than FreshBooks. Here’s our review.
The decision to start your own business is the first step towards financial freedom. But, it is an uphill task laden with challenges.
Firstly, you do not have enough capital to execute all your goals. Then, there are human resource challenges.
Most entrepreneurs will joggle between being the HR manager, CEO, accountant and in some cases the receptionist. All these tasks can leave one drained and frustrated. In fact, multitasking is the number one stress source for entrepreneurs. Enter FreshBooks…
FreshBooks is a cloud based automated accounting system that simplifies your daily accounting activities like invoicing, financial reporting, expense, and billable time tracking among others.
What I liked most about software is that it eliminates my need for paperwork. Instead of having a filing cabinet where I keep files for expenses, invoicing, billing, or accounting, I can have them all in my laptop.
Brief Company History
The journey to create FreshBooks was started by Mike McDerment. After trying vigorously to run his business operations through Excel and Word, he become frustrated and decided to create his own software – FreshBooks. The software was later re-leased as the New FreshBooks will the earlier version was now called FreshBooks Classic.
Many users faced various issues with the earlier version, which necessitated the launch of the new FreshBooks in 2017. Now users have access to more accounting features including double entry accounting. FreshBooks is an ideal invoice and billing system for small and medium enterprises that do not have the financial muscle for pricier ERP softwares.
Main Features of FreshBooks
When it initially started, the software was available on single machines. Since then users can run the application on cloud and giving them more flexibility. In addition, the application can also be accessed by mobile phone. When FreshBooks started, it had very basic features that centered more on invoicing and billing than accounting.
Then the founders started solving various development issues. The New FreshBooks is refined and has gotten rid of its outdated dashboards. The navigation is better and this makes it easier to find your way around the application. You can download FreshBooks on almost any device; you have the 11+ for iOS and 4.2+ for android.
The dashboard has gone through many changes to make it easy to use. You will have easy access to your total profit, outstanding revenue, spending, revenue streams, or unbilled time. The help buttons are easily accessible.
If you are new to the application and want to get a feel of it before settling in, you can try out their free trial version for the first 30 days. In these, instance you can get a feel of what the application offers. During the trial phase, you will not be required to enter any credit or bank details.
FreshBooks is available in three flexible pricing options:
- FreshBooks Lite: This comes at $15/month and allows you to send unlimited invoices and estimates. You also can access their expense tracking, project management, time tracking, and reports. The version is single user and allows you to bill up to 5 clients.
- FreshBooks Plus: Goes for $25/month and allows you to send unlimited invoices, and estimates. In addition, you also get access to contact management, project management, time tracking, advanced proposals, and live feed backs features. The version is single user and you can bill up to 50 clients.
- FreshBooks Premium: Goes for $50/month and has all features of the FreshBooks Plus and the ability to bill over 500 clients. The package is single user.
For those clients who are looking for more integration from their application, there is the FreshBooks Select. Here you get all features of the Premium plus ability to bill more than 500 clients and integration with other applications like Xero, QuickBooks and more advanced payment options.
The company offers a dedicated account manager for the application.
FreshBooks is a great application but there are drawbacks when it comes to its pricing. Many find it expensive and the limitation of the app to just one user is serious challenge to medium sized organizations. You can imagine coughing up extra dollars every time you need a new user.
None of their packages supports accounts payable or allows one to set user permissions.
FreshBooks also comes with a referral program where existing users can earn up to $5 for a subscription that leads to a free trial and $55 for those that end up paying in full the subscriptions. The company protects you by including a 30-day money-back guarantee.
Anyone who desires additional users pays an extra $10/per month per user. The problem is that all the additional users that you add come in as business partners as there are no user permissions. This means they have access to all the company data.
This can be a risk – especially when employees leave the organization on a bad note. You can accept payments for major credit cards for your invoices, however, you are charged 2.9% or $.030 by FreshBooks payment. This is another additional cost that the company needs to review.
When FreshBooks was launched it was to solve the numerous challenges SMEs face during invoicing. Proper and timely invoicing ensures that you have a constant stream of cashflows to run the business.
With FreshBooks you can get updates on when invoices are due, see when a client receives and opens your invoice. All these are supported by various online payment options – comes in handy when you are running an online store. Clients can pay you through Google checkout, MasterCard, Visa, Amex, PayPal among others.
FreshBooks allows you to customize your invoices in a variety of ways. These includes changing the fonts, colors, logos or headers. Most of the invoicing features like charging for late fees are enjoyed by the premium version users.
An inbuilt chat feature can be activated to show your interactions with clients in regards to payments. FreshBooks invoices are very attractive and presentable. FreshBooks also features a client portal where your clients can check on their billing, print estimates, and even write you messages concerning the invoices.
You can grow your enterprise by either increasingly revenue or managing costs efficiently. FreshBooks expense helps you keep your expenses under control through timely and efficient tracking of all your receipts.
You can then use the application in budget and tax preparation. If you are dealing with many online transactions and the monies are going directly to your account, you can import these receipts to the system flawlessly.
During budgeting you can create, duplicate and view various estimates and even convert them to invoices. The system allows you to either enter your expenses manually or import your bank statements.
Note that when importing from the bank the system is not wholly automatic as you it is done on a daily basis. As stated, FreshBooks has some limitations when it comes to handle taxes but you have most of the forms resembling IRS fillings categories.
This also means you will need to prepare deductions again for both your business and personal accounts.
When the company started their main focus was invoicing and billing but later incorporated various accounting options like double entry in the New FreshBooks version. The accounting functions that you get will largely depend on the version you are using.
If you are on the plus and premium version then you can perform bank reconciliation and double entry accounting. The accounting functions on FreshBooks are pretty basic as even the chart of accounts does not allow you to edit or delete your accounts.
It also lacks an accounts payable meaning you can only view those people you have sent invoices to. This is a major drawback as major accounting software come with accounts payable.
FreshBooks has basic accounting features that are ideal for small businesses but it is not recommended for someone who is handling more complex functions like tax or budgeting. You do not even have a payroll feature on the system and this means you will need to integrate with something else like Gusto.
You also cannot run multiple businesses on the system. This is something most enterprises will be looking for especially as they expand into various industries.
The best part is that new users do not take a lot of time learning how to use the system since most of the functions are basic. The navigation has changed a lot since the time of FreshBooks classic. In fact, now they have their own dedicated reports tab.
This is the section where you manage all your client information. You can enter personal contact details, language, default currency, late fees charges, and invoice reminders.
An easy to use graph will display amounts outstanding, paid and drafts if any. The page is easy to use and helps one keep current client records.
In a world of virtual teams you need an application that allows you to manage all your projects with ease. These means you can create fixed or hourly projects for your employees and subsequently bill them to your clients. To ensure that you do not miss on any project, you can assign due dates and time budgets.
A project management application without instant messaging means you will be forced to use two separate applications – one for projects another for messaging. FreshBooks has an interactive messaging tool called “discuss” that lets your send and receive messages among virtual teams.
You can even send attachments related to the project with ease.
Access to reports is through a tab on the dashboard. The number and type of reports that you have access to will depend on the package you are in. For the basic FreshBooks you can view up to 8 reports but the premium and plus subscriptions come with three extra ones. Users can create and view journal entries.
The proposal section is pretty cool with a section for overview, and description of the scope of work. You can add an e-signature to your right and even customize your proposal for fonts and colors. The proposal also allows you to specify the language used and currency – comes in handy when you are dealing with international clients.
The original FreshBooks come with 22 reports and this have being downsized to the current 8. You should note that FreshBooks is compatible with over 170 currencies which makes it easy to implement across the world.
When it comes to software what worries many people is having prompt and available customer service. Such services should be easily accessible through email or live chats. FreshBooks excellent customer service has not changed much since it started. The company has responsive and helpful staff always on standby to offer assistance.
In fact, FreshBooks has won several awards for this. You can contact staff through email or phone during business hours that ran from 8am to 8pm – Monday through Friday.
Before contacting the staff you should first checkout their self-help section on the applications. Here you will find several FAQs. Emails and phone calls are responded to fast and the staff is professional. There also can be contacted through online support.
The company is also active through their various social media platforms like Twitter, Facebook, or LinkedIn. FreshBooks will also hosts various webinars where users can better learn how to utilize the product features.
When FreshBooks was started it had very basic features and users run into several problems when during this phase. With time the company has improved its product features focusing more on accounting.
Updates have resulted in several positive reviews from users. However, the application is has some drawbacks Firstly, it lacks an accounts payable. This is a standard feature in most accounting software. The application is also single user and you need to pay extra for extra users.
This means most of your data is exposed as there is no user permissions. The monthly charges are also above other similar software. FreshBooks is a great software for those starting out in business and want something easy to use while effectively managing their invoices and expenses.
It is not suitable for large enterprises operating in varying industries.