W1 Insight

MYOB, Sage and Paprika have come out on top in our recent survey of accounting software packages used by creative companies.  None of these software packages is at the high end in terms of cost and complexity, which suggests that users consider ease of use, reliability and quality of support to be as important as the range of functions and number of reports a package can generate.

Popular options

The two most commonly used packages are Paprika and Sage, used by 28% and 21% of businesses, respectively. It’s not surprising that Paprika is popular given that it markets itself as an integrated job costing and accounting system, specifically designed for creative agencies. In fact, two thirds of the accounting software systems used by survey respondents included some form of job costing function and over half had an integrated timesheet. Only 5% of businesses reported using two packages within their organisation due to a need to have both an effective job costing system and accounting system. Creative agencies bill clients according to time spent on individual jobs, so a job costing system is important to monitor and control costs.

Access and Quickbooks also proved popular but less so than Paprika and Sage, with fewer than 10% of users each. Size of business appears to be an important factor in the choice of accounting software, with larger businesses preferring more heavy duty, complex software, such as Adserve, Navision and Tempora, and smaller businesses opting for a cheaper ‘off-the-shelf’ alternative, such as MYOB, Sage or Quickbooks.

Medium-sized businesses appear to prefer Paprika, with 81% of companies that use it recording a turnover of between £2m and £10m. Yet Sage is used by companies with turnovers ranging from £100,000 to £25m. One possible reason for this is that  there are numerous versions of Sage available, so as businesses change in size, they can trade up or down  to a different version as required.  

Purchasing reasons

Interestingly, almost half the finance teams surveyed use their current accounting software package because it was already in place when they joined the business. This would suggest either a reluctance to change the system knowing the upheaval and difficulties it will present or an ‘if it ain’t broke, don’t fix it’ mentality.

One third of businesses, however, chose their current software because it was recommended to them. Paprika was the most recommended software with half of Paprika users surveyed implementing the system for this reason. Sage came second, with 40% of businesses running the software following recommendations. Only 12% of finance staff implemented their current accounting software system because they had used it previously. But, reassuringly, over 30% of businesses felt their current software provided value for money.

Pricing range

MYOB and Quickbooks came in the cheapest with an average annual cost for licences, maintenance and consulting of £350 and £425 a year. At the other end of the spectrum, Adserve and Tempora were reported to cost more than £20,000 annually, with Maconomy and Navision costing between £10,000 and £20,000 a year.

Sage costs varied significantly, from less than £200 up to £500 annually, largely due to the number of different versions available. Paprika users reported similar cost differences. These variations are largely down to the way the software was first implemented. The clear message is get it right from the start by paying for consultancy/customisation or spend large amounts later on trying to address the problems and make improvements. This said some form of software support remains important to finance teams, with 83% of respondents confirming that they pay for product support. 

There was a clear correlation between the size of the business and the average annual spend on accounting software. Over half the businesses with a turnover of less than £5m spent no more than £500 on their accounting software. More surprising was that nearly a third of businesses with income between £5m and £25m spent less than £200 a year on average, with two thirds of the largest businesses spending £5,000 or more annually.

What’s important

MYOB and Sage, two of the smaller accounts packages, were reported as being two of the easiest products to install and use as may be expected from retail-boxed software products. Maconomy was rated as easy to use by two thirds of users, scoring an average of 8.5 out of 10, while a third of users rated it a modest 5. Clearly, experiences differ depending on the size and nature of each organisation, as well as how the software was implemented as there is a clear correlation between the ease of use, reliability and quality of support.

Quality of support varied considerably regardless of the size and quality of the software. Adserve, Sage and Skynet all scored over 7.5 out of 10 for support, with Sun Accounts, Maconomy and Quickbooks scoring below 5. In contrast the reliability of accounting software packages proved more consistent, with most packages scoring an average of between 7 and 9 out of 10 for reliability. Only Datavalley, Navision and Tempora scored 5 or below.

Conclusion

Taking all criteria into account, MYOB, Sage and Paprika scored the highest with 7.75, 7.03 and 7 respectively. Sage and MYOB do not offer true job costing facilities in their standard packages, but Paprika does so it’s impressive to see that most users are happy with this side of the software. The poorest performing packages were Sun, Tempora and Navision with scores of 5, 4 and 3.83 respectively.

When choosing an accounting software package, users must first consider how the software will be used. The range of functions and number of reports a package can generate will no doubt be of interest, but just as important are ease of use, reliability and quality of support, as our survey demonstrates.

For further information, contact:

Esther Carder
T: 020 7304 4646
E: ecarder@kingstonsmithw1.co.uk