Small startups have more to gain when they adopt the right accounting system early on. The benefits of employing a modern accounting system in the Philippines are well recognized, and the advantages only multiply with early adoption.
That said, to get the most utility out of their chosen software, startups have to be especially careful when they make their selection. Regardless of whether they choose to go with a free-to-use system or one that costs thousands of pesos, the following features should still be made a priority.
1) Easy-to-understand user interface
While accounting systems are intended to reduce human errors, a complex interface may increase the chances of these happening. More complex systems also increase the training requirements and onboarding time needed for users to master the system. In a startup setting, accounting software with a simpler interface may be more desirable even if it may have fewer features, just because they can be used more intuitively.
2) Cloud storage and hosting
While a larger business may see an advantage to onsite deployment with their own servers and dedicated IT teams, the same does not apply for most small startups. With fewer resources to go around, onsite deployment and dedicated IT teams are investments a small operation can ill-afford and may not see a return on.
In any case, cloud storage and hosting is also the preferred solution for many large businesses as well, not just for the lower cost of maintenance, but for the reduced downtimes and scalability. Many cloud solutions also offer better security, as they tend to offer multiple levels of redundancy. Cloud server IT teams are also far more specialized in the specifics of the system, allowing for faster resolutions of system errors.
3) Simple customizability
Software customization can be the most expensive part of accounting software acquisition. Fortunately, many startups can be adequately served by some accounting systems with little or no customization.
On the other hand, there are others that could benefit from some degree of customization, given that every business has its own model and way of doing things. If an adequate off-the-shelf solution could not be found, then the chosen system should be customizable without any major effort.
4) Compliance with Philippine BIR requirements
Your software should help you comply with local laws and regulations and make audits a less harrowing experience for your startup. Any accounting system you adopt should be able to account for different BIR requirements as well as other unique local conditions.
5) Real-time reporting
Whether it’s something as mundane as keeping up-to-the-minute tabs on your inventory or forecasting projected demand, a powerful real-time reporting feature is a necessity in today’s data-centric business context. Real-time reporting can also allow for timelier decisions and fewer lost opportunities, making it especially important for startups that need to outmaneuver their competitors.
Whether you ultimately choose a cloud or onsite deployment for your system, your system must be able to achieve an adequate data processing speed. Slow processing can lead to plenty of frustration with the system while also reducing its overall value to your startup. Given that the ability to quickly pivot to meet challenges is a primary advantage of startups over their larger competitors, they will need a system that can act as fast as they do.
7) Future expandability
This is, perhaps, one of the most underrated features to look for. Growth is an expectation of startups, and any system you choose has to be able to grow with you in the foreseeable future.
Transitions between accounting systems can become progressively more difficult as your business expands in size and scope, and you want a system that will spare you the challenges of migrating to an entirely different system in aa few years.
Modular solutions such as SAP Business One as well as systems that offer tiered upgrades are often the best bet for a new startup, as these setups can significantly reduce the disruption that comes with each major change.
Today’s generation of Philippine startups is among the most innovative in history. To better scale that innovation, more local startups must start thinking about what accounting or enterprise planning software they must use, as these systems can have a major effect on their growth from early on.
What accounting systems would you recommend for Filipino startups? Tell us!
Interested in reading more about Accounting? Check out our articles about “Best Accounting Practices” and about “How accountants can make a difference for your business”.