Feel Empowered by Staying Ahead of the Game

Starting 1st July 2024, Xero will implement its second price increase within a year. This news has stirred concerns, especially among micro-businesses with annual turnovers under $20,000, who find the hike substantial. Yet, for most business owners relying on Xero for seamless bookkeeping and financial management, this is a manageable cost of doing business.

Evaluating the Impact of the Price Increase

Maximize Efficiency and Save Precious Time

Even if the price increase seems unfair because there are no added services, consider how efficiently Xero already supports your business:

• Current Efficiency: Think about the hours saved on bookkeeping, payroll, and reporting with Xero.
• Switching Costs: If contemplating a switch, remember the comprehensive costs beyond the new software's monthly fee. You'll need to:
  • Evaluate and select the right software.
  • Transfer existing data.
  • Learn the new system and update your procedures.
  • Link bank feeds.
  • Familiarize yourself with the new program’s quirks.

The Hidden Costs of Switching Software

Avoid Disruptions and Maintain Smooth Operations

Recall the initial setup and learning curve with Xero. Switching to new software could demand significant time and resources to regain the same level of efficiency. When advising software changes, we always consider:

• Data Entry: Who will manage data entry, and how will they adapt to the new system?
• Reporting Needs: Will the new software meet your reporting requirements?
• Access Requirements: Who needs access, and what training will they require?
• Business Goals: How will the new software support your ultimate business goals?

Is the Price Increase Worth It?

Stay Confident with a Reliable Partner

Before deciding on the $50 monthly increase, weigh the benefits of staying with Xero against the potential disruptions and hidden costs of switching. Consider these strategies to mitigate the price increase impact:

• Review and Adjust Pricing: Slightly increase your service prices to cover the additional subscription cost. For instance, a $1 increase per 600 annual sales will suffice.
• Cost Savings: Identify areas for cost reduction while prioritizing Xero’s benefits. Look for savings in other expenses, such as insurance or supplier bills.
• Optimize Your Subscription: Ensure you're on the right subscription level. If you don't need all current features, downgrade to a more suitable option before the new pricing takes effect.

Conclusion

Continue Thriving with Xero

Don’t let the upcoming price increase deter you. The cost of Xero is minimal compared to the time and effort saved from manual bookkeeping or transitioning to a new software. By taking strategic steps to manage additional costs, you can continue enjoying Xero’s streamlined bookkeeping and reporting processes, ensuring your business remains efficient and well-managed.

Stay Informed and Get Personalized Advice

For more insights and updates on managing your business finances and navigating software changes, stay tuned to our blog. If you have specific questions or need personalized advice, feel free to reach out to us directly.