Xero Accounting: Expectations vs. Reality

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Xero is quite famous among companies for the features and services it offers. It is one of the best accounting software out there. However, it is important to know everything about Xero before you decide to use it as your daily drive. 

What is Xero? 

Xero, like much standard accounting software such as QuickBooks and Sage, is a cloud accounting software that offers various features to keep your payments and records updated. It stores all the data in the cloud and works on a web browser, either on a smartphone or PC. It charges a monthly fee according to the package you choose. The cloud service gives it an upper hand as compared to desktop applications for bookkeeping.   

Xero offers three Accounting Software Plans that offer varying features and capabilities. All of the plans have different prices and are targeted for different types of businesses. Let’s have a look at each one of them separately. 

The Early Plan by Xero 

The Early Plan by Xero is the simplest and most basic plan offered. It is very economical and so an affordable option for small startups or businesses. Sole traders can also make use of this cheap offer. The reason is that it is the most affordable plan offered by not just Xero but any other accounting software. 

The Xero early plan allows you to generate five invoices and quotes through your account every month. Similarly, it only enables you to attach five bills per month to your account. Moreover, it offers twenty reconciliations for transactions per month. The highlight of this plan is the price. The yearly plan is priced at £8 a month. 

The Growing Plan by Xero 

The Growing Plan by Xero is most suitable for businesses in the small to mid-sized range. It offers lesser limits as compared to the Early Plan. So, for all businesses looking for more features and options, this is the plan to go for. 

The Growing Plan offers an unlimited number of invoices and quotes per month through the Xero account. Similarly, it enables you to generate an unlimited amount of bills through your Xero account every month. It is not just done here. The Growing Plan offers an unlimited number of bank reconciliations. However, the only downside of this plan is that It doesn’t allow you to access multiple currencies. All the limitless features do have a heavy price tag on them. The Growing Plan is offered at £25 per month, which is far more than the Early Plan. 

The Established Plan by Xero

The Established Plan by Xero is the most advanced and top-notch plan that the company offers. It offers the best number for features compared to other plans. It is suitable for mid-sized to large businesses. 

Similar to the Growing Plan, you will be allowed an unlimited number of invoices and quotes, attachment of bills, and unlimited reconciliation of transactions every month through your Xero account. What makes this plan stand out from the rest is its support for multi-currency business accounting. However, all these features come for a hefty £50 per month. 

Now let’s come to the advantages and the disadvantages of the software overall: 

The Advantages

The Advantages

Easy to understand 

The first and the fundamental bit of advantage of Xero is that it is very simple to utilize. The web-based bookkeeping bundles are in general intended for non-accountants, and they centre around the key activities that the client needs to finish — for instance, logging purchase invoices and creating sales invoices. Xero is planned with the goal that it is genuinely natural to utilize.  


As the product is a cloud application, it is easily accessible anywhere, anytime. You can utilize Xero from your work area program. You can utilize it from your tablet, for example, the iPad or an Android tablet. You can have Xero on your cell phone. Whatever smart device you have, you can access Xero from it. 

This enables you to check your bookkeeping data anywhere you are. All you need is the internet and a smart device, and you are good to go with your account’s information. 

Consistent updates for the Xero software 

The Xero software is constantly refreshed. It is unlike any program that you download or purchase an application on your device, and it never gets updated unless you do it manually. With Xero, refreshes are being presented consistently, so you generally have the most recent, most modern rendition and it is altogether incorporated into the cost. What’s more, every time new highlights are included, you can approach those highlights very quickly. 

Reconciliation with different cloud applications 

As you know, Xero is in the cloud, it can without much of a stretch be associated with and trade data with other cloud applications. There are bunches of cloud applications that can work with Xero, for example, inventory CRM applications, management applications, banking applications. Xero can drive information out to these applications or draw information from them. 

Remote help by the accountant is possible 

Xero makes it simple for your accountant to get to your information remotely. Suppose I am an accountant, and my customer is utilizing Xero, and they are having an issue. The individual can ring me up, and we can go onto a Skype call or utilize a type of another conferencing type call. We can share our screen, so they can be taking a gander at my screen, or I can be looking at his/her screen, whichever we need. Utilizing these devices, we can resolve the inquiry decently fast. This could spare an outing out to the customers’ premises for me, which at that point makes the administration less expensive for the customer if all they need is five or ten minutes of my time. 

Safe information back-up 

Xero is constantly backed up on different servers. The software supplier will have the application and information put away in various information servers, so on the off chance that any information centre goes down, they have reinforcement and can get information from another server. You won’t even know about the unfortunate event. Xero does it on its own. It also enables you to download information, but that is for your satisfaction. Even if you don’t download, you will never lose data. Keeping information safe is one of their top priorities. 


Xero is a full-grown item, and at this stage, it has a ton of exceptionally valuable features. It offers multi-currency preparing, automated bank reconciliations, and recurring invoices among different features. A major preferred position of Xero is that it has some fundamental “knowledge” worked into the software. 

Real-time business management. 

The computerization in information collection opens the entryway to another idea – looking into your funds in real-time. 

Entrepreneurs regularly expect their desktop accounting software to run a long time behind. By correlation, web-based accounting software can be accommodated day by day, which makes month to month close-outs simple. 

Free Trial 

Another great advantage of Xero is that it offers a 30-day free trial no matter which plans you go for. So, in this way you can have a better idea about how the software works. 

The Disadvantages 

The Disadvantages

Slow with bigger transactions 

There are a few detriments to Xero. You are utilizing an online bit of programming, and in the event that you have a lot of exchanges or potentially a moderate association, you might hang tight for some time until the screens re-appear. So, on the off chance that you have plenty of exchanges, Xero probably won’t be for you. 

Clerks who come into an organization once every week or month to mass enter the exchanges frequently discover it sometimes falls short for the manner in which they work. 


Xero costs in excess of a customary desktop accounting software. On the off chance that you use something like QuickBooks on the web, you may have purchased that for perhaps £180-£200 for the permit, and you may get three to four years out of that before you choose to overhaul. So, it could cost you £50 every year. 

Xero regularly costs around £25 every month, so you would spend perhaps about £300 per year on your product, which is somewhat more than you may be utilized to spend. 

Dependence on the web  

Online business software requires a web association. Without it, you’re in a tough situation. This makes it unacceptable in situations where web access is inconsistent or excessively costly. 

Many organizations have realized the importance of online accounting software. As a result, they have opted to install fibre optic or microwave connects in order to have better internet connections with reliable speeds. So, it goes without saying that in a bad connection phase, Xero won’t do the job as good as you expect. 

The report feature drawback of Xero 

Numerous Xero clients feel that the detailing abilities accessible inside the product are not as cutting edge as they could be. For example, a few reports keep running from Xero must be traded to another outside record (for example general record). In this class, many feel that QuickBooks exceeds Xero. The inquiry to pose to yourself is whether you have to run point by point reports as often as possible—if the appropriate response is no, this factor may not influence you enough for it to issue. On the off chance that your answer is yes, in any case, it may feel bulky for you to send out specific reports to another program for a survey, and you may decide not to go with Xero. 

Bad client support 

Another disservice that Xero has gotten some analysis for is its client support. Xero does not yet have dynamic client bolster telephone administration, and numerous clients have felt stranded with regards to helping needs, investigating, and software requests. While the organization gives day in and day out visit support and online FAQ discussions, numerous endorsers feel that its absence of phone bolsters makes it badly arranged for clients to get the degree of help they need. 

Is Xero an ideal choice for you? 

Xero is a suitable choice if you are utilizing some cloud applications, similar to a CRM application or a stock application or possibly something like Expensify for overseeing costs. Xero can coordinate with those cloud applications and can make moving information from one to the next significantly simple. You should definitely have a look at Xero if this is the case for you.   

On the off chance that you do your very own books, you will find that Xero will give you a great deal of understanding into what is happening in your business. Xero will push you to comprehend your records truly. Finishing the errands of entering your expenses and your invoices, knowing where they go, and having the option to run the reports and drill down, will all have a ton of effect on how well you comprehend your records. 

There are a few organizations where Xero would be a solid match as a result of the sort and number of exchanges that they have. Some organizations even go to the extent of using Xero with just an iPad, and it works smoothly for them. Xero gives you the option to choose from different packages. You need to study yourself and the software before coming to a decision, whether it is right for you or not. 

In conclusion 

After going through the packages and all the pros and cons of Xero, you should be able to make a decision about it. Briefly speaking, Xero is one of the most expensive options out there given the price comparisons with other similar options. However, it still has commendable features and offers that stand out from the rest. If you are ready to make the investment and want the best of all, then Xero could be really good for you and the business.