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Having the ability to invoice customers quickly, accurately, and reliably is critical for businesses of any size. Modern invoicing software can help you to quickly generate invoices, deliver them to your customers, track when they have been opened and paid, and integrate with your existing accounting software.
That’s why we’ve put together a list of the best invoicing softwares for small businesses with detailed information on each one, so you can make the right choice for your business.
But there are many invoicing solutions and the best invoicing software for small businesses can depend upon several different factors, including:
For some very small businesses and one-man shops, using free invoice templates and spreadsheets may be suitable enough. If you feel like you have outgrown standard templates and spreadsheets, invoicing software can be a time and headache-saving investment for your business.
With so many options on the market, sifting through them to find the perfect solution for your business can be difficult. In this article, we’ll dive into the best invoicing software for small businesses, break down their features, and make recommendations regarding what types of businesses they might be most suited for.
Let’s get started.
Wave is a web-based invoicing solution that caters to small companies (1-9 employees), freelancers, and solo entrepreneurs. It offers true double-entry accounting and because it is cloud-based, your invoices can be accessed from anywhere in the world with an internet connection. Wave also offers a free app that is simple and straight-forward.
When it comes to modern invoicing solutions, Wave is a standout. Their system is exceptionally easy to use, especially the base invoicing features. Their team is constantly adding new features and updates, growing Wave’s functionality as time passes to make it a more well-rounded solution that is suitable for more business types.
Wave also delivers advanced features including full double-entry accounting, with the option to pay additional fees for expert help with bookkeeping, tax preparation, or accounting consulting. Wave also offers payroll features, which has its own set fees associated with it.
Wave is 100% free-to-use, opting instead for a fee-based system with a transaction percentage fee and a base transaction fee. There are no limits on the number of invoices, customers, or other plan-based limitations.
| Cards | Fee | Payout Time |
|---|---|---|
| Visa, Mastercard, Discover | 2.9% + $0.30 per transaction | 2 Business Days |
| American Express | 3.4% + $0.30 per transaction | 2 Business Days |
Additionally, you can choose to skip the 2 business day waiting period with Wave’s “Instant Payouts” feature. This feature works similarly to Venmo and other person-to-person payment solutions. Instead of using the standard traditional banking methods, Instant Payouts pushes money to your business bank account using the Visa and Mastercard networks. This costs an additional 1% fee, totaled after the original fee has been applied.
Wave also offers bank payments (ACH). Their fee for these payments is a 1% fee with a $1 minimum transaction.
Wave is the perfect invoicing software for small businesses that are looking for something simple, professional, and inexpensive. While it isn’t without its own quirks and small issues, the vast majority of businesses will never run into those using the standard features.
Wave is the great invoicing software choice for:
Very small businesses (up to 10 employees)
Freelancers
Solo entrepreneurs
Freshbooks is one of the most well-known invoicing software solutions for small and mid-size businesses. It was founded in 2003 and since that time has grown to more than 10 million customers. Like Wave, Freshbooks is a cloud-based invoicing and accounting solution that is designed for very small businesses and self-employed individuals.
It includes full finance tracking and client invoicing, along with advanced features like project tracking, time-keeping, and internal communication features. FreshBooks does not currently offer payroll features but there are several third-party integrations available with payroll functionality. In 2018, FreshBooks received a large update that added double-entry accounting features.
Known for being easy to use, both Freshbooks’ web-based dashboard and their mobile apps are intuitive without sacrificing functionality.
FreshBooks’ pricing is based on the number of clients/customers that you need to invoice. They offer four base plans, each covering an increasing number of customers. As you step up through the plans, additional features are unlocked as well. FreshBooks offers a free trial, so you can always try out the more advanced features to see if they meet your needs.
All four plans include:
Here is a breakdown of the plans and the features that are unlocked at each level:
| PLAN | PRICE | MONTHLY CUSTOMERS | ADDED FEATURES |
|---|---|---|---|
| Lite | $15/Month | 5 | Base Features (Listed Above) |
| Plus | $25/Month | 50 | -Payment Reminders -Late Fees -Accounting Reports -Recurring Invoices -Proposals |
| Premium | $50/Month | 500 | -Payment Reminders -Late Fees -Accounting Reports -Recurring Invoices -Proposals |
Each of these plans is available at a discount when billed annually.
FreshBooks is perhaps the most popular invoicing software for small businesses for a good reason — it is easy to use, reliable, and extremely customizable. While it does lack some features that would be a necessity for larger companies, their advanced time tracking and project tracking features make it a standout choice for project-based businesses and freelancers.
While their monthly fees are reasonable, the pricing on their Premium Plan ($50 per month) is higher than the competition while delivering many of the same features. Additionally, only allowing up to five monthly clients or customers for their smallest plan means that most businesses, including freelancers and solopreneurs, will require an upgrade to the Plus plan, which costs $25 per month.
FreshBooks is recommended for:
Companies that don’t mind a monthly subscription
Small to midsize businesses
Freelancers
Solo entrepreneurs
Intuit’s accounting software solutions have been the de facto small business accounting solution since they were first founded in 1983. At the time, they completely reshaped the accounting software landscape. Their first product, Quicken, was the precursor to QuickBooks, which was launched in 2002 and quickly followed with the launch of QuickBooks online two years later. At the time, they were pioneering a cloud-based approach that would become an industry standard.
Today QuickBooks Online has more than 2 million users and the product itself has seen many advancements. More than just an invoicing software (although it does feature advanced invoicing functionality), QuickBooks Online is a full accounting, financial management, and project management suite for small, medium, and large businesses.
QuickBooks Online is known for its strong reporting and highly customizable invoices. It offers multi-currency payment options across all major credit cards.
QuickBooks Online also shines in the integration department, with more than 600+ integrations with some of the most popular business software in existence today.
Beyond their invoicing and account features, QuickBooks directly connects with platforms like QuickBooks Capital, where businesses have access to loans and liquidity directly through Intuit’s platform. Their QuickBooks Live Bookkeeping add-on is a service-based addition that allows you to connect with an experienced bookkeeper or accounting consultant that has expertise in the QuickBooks Online platform.
While many companies use the QuickBooks Desktop software, many do not realize that QuickBooks Online actually offers a range of features that are not available in Desktop including sales receipts, split transactions, automatically scheduled invoices, and location categories.
QuickBooks Online offers a cloud-based solution that allows you to access your data and invoice customers anywhere, at any time. While the pricing and learning curve for QuickBooks Online is steeper than other invoicing software covered in this article, it is still more intuitive and easier to learn than QuickBooks Pro and legacy accounting software.
QuickBooks Online is a bit more expensive than the other invoicing software for small businesses on this list, but that is to be expected with the advanced features that it comes with.
QuickBooks Online offers 5 separate plans. Each plan offers unlimited invoices and customers. As you step up through the plans, you gain access to more advanced features.
The base features for all plans include:
| PLAN | PRICE | Added Features |
|---|---|---|
| Self-Employed | $15/Month | Base Features |
| Simple Start | $25/Month | -Send estimates -Track sales & sales tax -Manage 1099 contractors |
| Essentials | $40/Month | -Manage bills -Track time -Includes 3 users |
| Plus | $70/Month | -Includes 5 users -Track project profitability -Track inventory |
| Advanced | $150/Month | -Business analytics & insights -Batch invoices & expenses -Customize access by role -Dedicated account manager -On-demand online training -Automate workflows |
There are several payroll and set up add-on services that can be appended to these plans that each has their own costs associated with them.
QuickBooks Online is a powerful solution that manages to retain its intuitiveness and general ease of use for most users. With that said, the sheer number of features means that it might be a better solution for larger companies or companies that are looking for expanded accounting features.
Xero is a cloud-based accounting and invoicing software solution that is headquartered in New Zealand. In general, Xero is more of a robust account solution and less of an invoicing solution. Still, it offers many exceptional features that make it one of the best invoicing software choices for small businesses.
Today Xero has more than 2 million users that use it as their primary accounting and invoicing software. Their modern user interface is clean looking and easy to use.
Recently, Xero has expanded to include a number of project management and team tracking features that have made it a suitable solution for small, project-based teams. However, this expansion of features has also come with some drawbacks, as user complaints have increased since the company began rolling out their large feature additions.
Xero is a more expensive solution than Wave and Freshbooks, but on-par with QuickBooks Online. This is to be expected due to the expanded accounting and additional features, but that may take it out of the price range of smaller businesses and solo entrepreneurs.
Generally, Xero is very intuitive and easy to use. Their mobile apps have an excellent reputation among their users and are one of the things that are most often referenced positively in user reviews across the web. One key area where Xero stands out is in the fact that they offer unlimited users on all of their plans.
Xero’s smallest plan is quite affordable but limits users to only five invoices per month. That means that most users will need to step up to the middle plan. In total, Xero is available in three plans, each offering an expanded feature-set.
The base features are available in every plan and include:
| PLAN | PRICE | Added Features |
|---|---|---|
| Early | $9/month | Base Features |
| Growing | $30/month | -Unlimited Invoices -Unlimited Bills -Unlimited Reconciles -Capture bills and receipts |
| Established | $60/month | -Multi-currency -Capture and manage claims -Track project time and costs |
Xero is a highly advanced and respected invoicing and accounting solution. With more than 800 available integrations, you’d be hard-pressed to find a piece of software that it doesn’t integrate with. However, the advanced feature sets and more expensive price tags mean that Xero might be better suited for companies that are looking for a more comprehensive solution than those that use Wave and FreshBooks.
Choosing the right invoicing software for your small business is an important choice. It will serve as the primary channel through which you receive payments and drive experiences for your customers and clients. You must decide with all of the available information so that you find the best solution for your small business.
The recommendations in this article are all excellent pieces of software. Each has its benefits, drawbacks, and situations where they would be a better fit. The overviews and recommendations in this article should serve as a starting point for your research.
