Xero Review: Features, Pricing, & Alternatives

Looking for an easier way to invoice your clients and track your financials? Try using invoicing software. Xero is one of the best and excels at it. It helps small businesses track cash flow and manage bills and invoices. 

However, Xero has its downsides; It lacks phone support, and the expense tracking feature is basic. Now, how does it perform as an invoicing software?

Let’s find out in this Xero review.

SMB Guide’s Verdict for Xero

Xero gets an 8.0 out of 10. Here is why:

Xero delivers a capable invoicing platform with powerful integration and an easy-to-use interface. Its multi-currency support, expense tracking, and 1099 management support make it stand out.

However, Xero has some limitations. The customization options have limitations, and the expense tracking is basic.

The good thing is that Xero offers decent financial management and invoicing software. It suits SMBs looking for accounting software with powerful integration and automation capability.

Factor	Rating (out of 10)
Pricing & Plans	7
Feature Set & Customization Options	8
Automated Invoicing	9
Expense Tracking	7
Multi-Currency Support	9
User Interface and User Experience	8
Integrations and Compatibility	9
Customer Support	7
SMB Guide Rating	8

In this review of Xero, I’ve followed SMB Guide’s detailed criteria for evaluating accounting software.

Pricing & Plans

Xero pricing is straightforward. It offers three scalable plans, but without a free package.

The plans come with a 75% discount for new US-based businesses with subscriptions of 6+ months, a remarkable deal. Xero also offers a month-long free trial to test the software’s inner workings.

Here are the plans:

Early

It is the entry plan offering Xero’s basic invoicing features.

Price

• Monthly: $15

Features

• Enter a max of 5 bills
• Send quotes and a maximum of 20 invoices
• Sales tax collection
• 1099 and W-9 management support
• Short-term cash flow and business snapshot
• Capture bills and receipts with Hubdoc
• Bank transaction reconciliation

Who it’s for: Individuals looking for basic invoicing and a way to capture receipts and run reports.

Growing

It is an upgrade from the Early package, offering advanced invoicing capabilities.

Price

• Monthly: $42

Features

• All features in the Early plan
• Send unlimited invoices and quotes
• Enter unlimited bills
• Bulk transaction reconciliation

Who it’s for: Growing businesses with a more extensive invoicing clientele requiring advanced capabilities like bulk reconciliation.

Established

It is the top plan and an upgrade from the Growing package, offering more advanced capability.

Price

• Monthly: $78

Features

• All features in the Growing plan
• Multi-currency use
• Project tracking
• Advanced analytics
• Claim expenses

Who it’s for: Large enterprises with international clientele needing multi-currency use and tracking large projects.

Feature Set and Customization Options

The general customization level of invoices on Xero is decent. Users can upload a company logo and tweak the colors and font of the invoice to match their brand.

Xero also provides pre-built templates that users can tweak to their liking or create from scratch. Users can add messages or delete elements that don’t fit in the invoice templates.

Xero also offers advanced invoice customization options. Users can use the templates to add custom fields that capture specific business details. For example, serial numbers, compliance info, project IDs, product codes, and more.

However, Xero’s template editing lacks drag-and-drop functionality, which is a bummer. The good thing is that Xero offers a DOCX template that users can download and edit on MS Word.

The template is flexible and offers advanced field manipulation, including the design. Users can add a personalized message on the templates, such as a special offer or welcome greeting.

Automated Invoicing

Xero allows businesses to set up recurring invoices for the products or services they bill regularly. It is suitable, especially for businesses with predictable billing cycles.

Now, setting up and scheduling invoices is simple on Xero. Users can create a customizable template and set it as a recurring invoice. Once set up, users can schedule it to send invoices at set intervals (weekly, monthly, or yearly).

The best part is that it won’t require any additional manual input. Managing the automated invoice schedule is straightforward. Users can define the frequency, recipients, and amount as necessary.

Xero also includes an auto reminder option to increase timely payment collection.

Expense Tracking

Like most invoicing software, Xero allows businesses to enter their expenses manually. However, they must attach receipts and categorize them based on business needs.

Xero also has a mobile app that lets users snap photos of their receipts. It is handy for entrepreneurs on the go since it lowers the risk of losing expense receipts.

Something to note is that Xero lets businesses link expenses to specific customer invoices. It helps give an overview of the total cost for specific projects or jobs. In hindsight, it helps businesses bill their clientele accurately.

Xero supports expense categorization, helping businesses manage their financial records better. Businesses can categorize their expenses by client, type, or project. It helps provide more in-depth reporting of the financials.

The granular expense reports allow businesses to understand spending patterns, which helps them forecast and budget better. The best part is that the reports are customizable.

Users can categorize them by period or project, helping them make better decisions.

Multi-Currency Support

Businesses with international clientele can use Xero to invoice, quote, and create purchase orders in 160+ currencies. The platform provides an automated currency conversion capability that simplifies handling foreign transactions.

The best part is that Xero updates the exchange rates hourly to ensure businesses access real-time rates.

Now, businesses have the option of manually overriding the exchange rates if they have been pre-negotiated beforehand. Businesses can set custom rates on specific invoices in regions with volatile currency fluctuations.

Something to note is that Xero uses XE.com to retrieve exchange rates. The day’s rate is reset at 11.00 pm, depending on the time zone and financial settings.

It helps ensure that currency fluctuations are reflected in reports and transactions.

User Interface and User Experience

Xero’s interface is modern and well-organized, making it easy to navigate. Creating, sending, and managing invoices follows a logical workflow. It makes it easy for users to get started.

Users with accounting backgrounds find the software more straightforward to use. However, beginners can learn using the platform’s self-help resources, like tutorials and guides.

With advanced customization options, Xero falls short in tweaking the interface and dashboard. It limits users who prefer personalized workspaces. Not only that, but advanced features like project costing require accounting skills.

Integrations and Compatibility

Given that Xero is a popular invoicing platform, it lacks direct integration with competitors like FreshBooks and QuickBooks. However, it has an extensive integration stack with business, CRM, payment, and professional service systems.

Xero also integrates with online payment systems like Square, PayPal, and Stripe. It helps simplify online invoicing and reconciliation processes for businesses.

Now, businesses will find Xero automates the sync between compatible accounting systems and invoicing software. It helps ensure data consistency and reduces discrepancies.

Businesses looking to integrate custom applications will find Xero offers an open API. Through it, they can customize their invoicing ecosystem to fit their business needs.

Users will also find a mobile app (iOS and Android) on Xero. The app allows businesses to create and send invoices, manage expenses, and capture receipts while on the go.

The good thing is that the mobile app syncs with the desktop web app for data consistency.

Customer Support

Xero offers its support through email. Unlike other popular invoicing platforms, it lacks phone and live chat support, which is a drawback.

The support staff’s email response times are decent, with replies within 6-10 minutes. They are knowledgeable about the issues and helpful in their responses.

Xero also has self-help resources such as a blog, FAQs, and tutorials. The content is comprehensive for troubleshooting and self-learning.

Xero – Unique Features

After exploring Xero’s strengths across various aspects, we found three features that make it stand out. They include:

Xero contact management

Businesses can add, store, or edit client contact details, notes, and documents within the platform. The best part is that users can access the contacts on the app, even on the go, and see all the details in one place.

Data capture

Xero provides a Hubdoc feature that makes it easy to take photos, scan, email, or upload documents. Users can also sync the transactions automatically for seamless reconciliation.

Inventory management

Through the inventory management feature, businesses can track their stock levels and record their value. The feature also reports how well items perform to keep up with demand.

What Experts Say About Xero

Xero has received many reviews online, both positive and lukewarm, from users on platforms like G2.com. Here is what they said:

We are getting a very precise experience working on our finances with Xero. It has made it easy for us to streamline all our financial activities. Xero keeps us in check on our expenses and budget.

Bodamer T., Foreign Language – Verified Capterra review

The Xero experience is nothing short of amazing! The user interface is very easy to navigate so anyone can use it. There are various report that can be extracted to create various client reports. They have quarterly updates to keep up with the new trends and address new client concerns.

Faye C., Finance Manager – Verified Capterra review

Xero Alternatives

Xero offers compelling invoicing software for the modern business. However, it might not be the best suit for every business type. So, here are 3 alternatives to consider:

FreshBooks

FreshBooks and Xero share similarities in providing capable invoicing features and a mobile app (Android and iOS). They offer client management, time tracking, and a user-friendly interface.

On pricing, the FreshBooks entry plan costs $19 monthly, and like Xero, it lacks a free package. It makes FreshBooks suitable for small businesses looking for efficient invoicing and basic accounting.

Try FreshBooks for free today

QuickBooks Online

QuickBooks Online shares similarities with Xero in providing inventory management, invoicing, and granular reporting. It also offers an extensive pre-built integration stack to streamline businesses’ workflows.

With pricing, the QuickBooks Online entry plan starts at $18 monthly and, like Xero, lacks a free package. It makes QuickBooks Online suitable for established businesses looking to simplify invoicing through automation.

Wave

Wave offers businesses basic invoicing, expense tracking, and accounting features. It is also attractive to individuals and micro-businesses because its plans include a forever-free plan.

Wave’s paid plan costs $16 monthly and includes advanced capabilities like auto-importing bank transactions. It makes Wave suitable for small businesses looking for free invoicing software with basic features.

Sign up to Wave Accounting for free

Get Started with Xero

Xero supports every aspect of the financial management of small and growing businesses. Its main selling points are the 1099 support, payroll integration, and 160+ multi-currency support.

We recommend Xero to small businesses looking for multi-user access to fix their invoicing and financials. Sign up for free and start your 30-day trial!

FAQs

Related reading:

• Xero vs. FreshBooks