As a VP or director of a D2C company, what are your duties? You’re responsible for bringing in revenue and keeping your operations running. That’s it? Nope! On top of that, you must:
- Track expenses
- Send invoices
- Review reports
- Stay compliant
And to serve these additional duties, you need advanced accounting software. Searching options? Two names dominate this space: Xero and QuickBooks. Both promise to simplify your financial work, but they serve different needs.
In this article, let’s understand the detailed comparison between QuickBooks vs Xero so you can decide which platform truly fits your business.
What is the “QuickBooks” Accounting Software?
QuickBooks is accounting software created by Intuit, a company started in the early 1980s by Scott Cook and Tom Proulx. It began as a tool built on personal finance concepts, with one purpose: “Give small businesses an easy way to manage daily financial tasks”.
In its early years, especially during the 1990s and early 2000s, QuickBooks struggled in global markets. Accountants raised concerns about:
- Weak security
- Missing audit trails
- Limited compliance with standard accounting rules.
In response, Intuit strengthened the system. They improved financial records, added controls, and made the software safer from data theft. Today, QuickBooks is a complete platform for small business finance. You can:
- Run payroll
- Track inventory
- Send invoices
- Receive payments online
- Monitor daily transactions
The system also supports time tracking and offers access to bookkeeping services if you need outside support. Note that QuickBooks is subscription-based, with monthly and yearly plans. Each plan provides a set of features designed for different business types, so you can choose what fits your needs.
What is the “Xero” Accounting Software?
Xero is cloud-based accounting software created in New Zealand by Rod Drury and Hamish Edwards. They built it because many small business owners struggled to handle accounting without the tools that large companies use.
Today, Xero has more than 4.2 million subscribers across 180 countries and connects with over 1,000 third-party apps. But in the beginning, Xero had a difficult path. It had to compete with big players like Intuit, and many people were unsure about trusting a new software company.
Additionally, Xero also had to solve technical challenges, such as making the software work with different accounting rules and tax systems around the world. But over time, Xero improved its product and expanded its features. It now offers tools for:
- Tracking income and expenses
- Managing bills
- Creating invoices
- Monitoring spending
- Keeping an eye on inventory.
The software also includes strong access controls. You can assign user roles, such as Limited, Standard, or Administrator, and control what each person in your business can view or handle. This allows you to manage permissions across your team.
QuickBooks vs Xero: How Do They Differ?
Choosing accounting software is a long-term decision that can be confusing, particularly when both tools claim to support small businesses. While the selection depends on your accounting needs and budget, you may still:
- Prefer Xero if you prefer a simple software that your team can learn quickly.
- Prefer QuickBooks if your business needs more advanced tools, deeper reporting, or strong payroll support.
To improve your understanding, check out the detailed QuickBooks vs Xero comparison below
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QuickBooks vs Xero: How to Choose the Right Software in 2025?
Selecting accounting software for the first time can feel confusing! Both Xero and QuickBooks offer strong tools, but each is built for different types of businesses. Your goal? Try to choose software that matches your size, workload, and future plans. Let’s see how you can do it:
Best Choice for Small Businesses
Xero is suitable for small businesses that want simple accounting software without too many advanced functions. Its layout is easy to understand, the pricing is affordable, and it connects with many apps.
Additionally, it covers the core tasks most small businesses need, such as invoicing, tracking money in and out, and managing basic records.
Best Choice for Medium and Large Businesses
QuickBooks is built for businesses that need stronger control over their finances. It offers deeper features, more customization, and stronger reporting.
Because of these tools, QuickBooks is often chosen by businesses that want more insight into their numbers and expect to expand over time.
Still Confused Between QuickBooks vs Xero? Why Not Outsource 100% of Your Accounting Function to Atidiv?
So now you know that QuickBooks vs Xero are two different accounting software tools built for different types of businesses. If we talk about QuickBooks vs Xero differences, we can state that:
- QuickBooks offers deeper and more customisable features.
- Xero is simpler and easier to learn.
- QuickBooks supports stronger payroll functions.
- Xero includes unlimited users on all plans.
- QuickBooks provides advanced reporting tools.
- Xero has more affordable pricing.
But not everything is rosy! Both platforms may include hidden charges such as add-ons, payroll upgrades, extra storage, higher-tier features, and charges linked to external integrations. These costs can increase your monthly spending beyond the base plan.
That’s why several D2C companies and consumer brands in 2025 prefer hiring accounting outsourcing companies like Atidiv. We have 16+ years of experience and serve 70+ global clients. Our expert team includes 390,000+ chartered accountants and CPAs offering comprehensive bookkeeping services.
Start availing our services at only $15 per hour. Book a free consultation call to learn more.
QuickBooks vs Xero FAQs
1. What should I choose between QuickBooks vs Xero in 2025?
As a senior manager of a D2C company, you can choose Xero if you want simple software that handles day-to-day accounting. Whereas, you may go after QuickBooks if you need more advanced tools and expect your business to grow into a more complex operation.
2. Which software is easier for a small business owner to learn – QuickBooks vs Xero?
Xero is simpler to learn because its layout is clean and easier to understand. QuickBooks offers more features, but this also means a longer learning curve.
If you want basic accounting that your team can pick up quickly, Xero is the easier option. If you need deeper tools, choose QuickBooks.
3. Will I need to buy extra add-ons?
Yes, in many cases! Both platforms may require paid add-ons for:
- Payroll
- Advanced reporting
- Inventory tools
- Industry-specific features
These costs are not always visible upfront. So, your final monthly expense can be higher than the base price of the plan you select.
4. Which software is better for inventory-heavy businesses?
QuickBooks is stronger for businesses that handle stock, variants or detailed tracking. Xero has basic inventory tools suitable for simple product lists but not for complex item management.
If you run a retail, manufacturing, or e-commerce business, QuickBooks generally offers more depth.
5. What if my team grows? Which tool between QuickBooks vs Xero, will scale better?
QuickBooks supports scaling through detailed features, advanced reporting, and stronger workflows. However, higher-tier plans can become costly. Xero allows unlimited users on all plans, but has fewer advanced tools.
If your team expands and needs deeper control, QuickBooks is better, but expect higher costs as you grow.