Xero vs FreshBooks Comparison 2023: Which Is Better for You?

Xero and FreshBooks are two outstanding accounting desktop software. They provide a set of tools that can be very useful for you depending on your business needs. But picking the right one might be a hassle, so we’ve put together this Xero vs FreshBooks comparison just for you! 

The accounting software that fits your business could be the difference in a better CRM direction for your business. 

Xero and FreshBooks will go head to head in various departments, including pricing, which is essential for many people, Bookkeeping capabilities, Bank reconciliation features, and other vital criteria.

Ready? Let's get to it!

What is the difference between FreshBooks and Xero?

The main difference between Xero and FreshBooks is that FreshBooks focuses on simplicity and is geared toward small businesses and freelancers. Xero, on the other hand, offers more robust features and scalability and caters to a wider range of businesses, including larger enterprises. Read on for more details!

Xero is considered one of the best professionally engineered accounting software on the market as it has a comprehensive set of features in which it excels, including its inventory management, its scalability, and its access to over 1000 integrations.

On the other hand, FreshBooks gives users a personal feel when they get into the world of accounting, its time-tracking capabilities are amongst the best on the market and it excels in the customer care department too.

While we might not be able to go in-depth into the core features of each accounting software, we have both a comprehensive FreshBooks review and a detailed Xero review for you to take a deep dive into the inner workings of both accounting software. 

Xero vs FreshBooks comparison chart

We have picked out some solid categories that can help you get an overview of the functionality of both online accounting desktop software. We took the liberty to drop our well-researched opinions on both software via this table. 

Xero vs FreshBooks pricing

Pricing is one crucial part of picking any online solution. You might check all the necessary features, including if the software is cloud-based or not. If the customer support is strong or not, and other essential factors. Still, if the pricing is unsuitable, it could be a barrier to getting on a plan.

Xero offers three plans, Early, Growing, and Established, respectively. Early is priced at $12 per month, Growing is priced at $34 per month, and Established is priced at $65 per month.

FreshBooks has three priced plans and one custom pricing suite. They are Lite at $15  per month, Plus $25 per month, and Premium at $50 per month.

Winner: 

It is pretty close to deciding a winner when it comes to pricing. Xero takes the early lead, with their Lowest tier having the better price appeal, climbing up further tells a different tale. 

Our winner goes to FreshBooks as it provides more value for money on its basic pricing, and the prices come lower the more you upgrade your plans.

FreshBooks vs Xero free versions

Many business owners like to use the free versions of apps, especially when they are just starting out. Unfortunately, neither FreshBooks nor Xero has a free version of their apps. They both run a 30-day free trial that affords users access to all the available features, such as time tracking, bank reconciliation, bookkeeping, and other options.

Winner: 

No winners, no losers, and a draw through and through.

Customer support

Customer support is essential for the user experience of business owners and freelancers alike. Both Xero and FreshBooks have various customer support options; let's look at both options.  

Xero offers Xero Central, allowing users to contact the Xero support team that is available for trial users. Then there is the live chat option available for paid users; unfortunately, this does not extend to live calls.

FreshBooks offers a more robust customer service suite offering chat, email, and phone support. Phone support for users of FreshBooks is available within a limited time frame, Monday-Friday from 8 am to 8 pm Eastern time. Emails receive quick responses, and the live chat is with a bookkeeping expert.

Winner:

Clearly, the winner here is FreshBooks, as they have more comprehensive customer support options.

Knowledge base & learning

How quickly can users get the hang of using each service? 

Xero boasts a robust knowledge base and learning options. Suppose you have any questions with regard to cash flow, bookkeeping, expense tracking, and other accounting features provided by Xero. In that case, they have resources like articles, guides, walk-through videos, and guides all available for you either as a visitor or as a user.

FreshBooks also has help resources such as its 'How to guides,' an faq section, on-demand webinars, and a mobile help guide. Its intuitive design also helps users catch on to using it well.

Winner: 

The sheer organization and reach of Xero's detailed resources helped it clinch this victory.

FreshBooks vs Xero features & functionality

We have been able to touch on the major pain points of choosing from a host of accounting services, the pricing plans, the availability of a free version or a test period, and the responsiveness of their customer services. 

These are, without a doubt, core essentials. Now let's look at the features and functionality of both accounting services to determine which fits you best.

Xero or FreshBooks for ease of use?

Xero is a strict traditional online accounting solution. The interface though neat is something more easily understood by accountants and people with prior accounting knowledge. 

Navigating from feature to feature is not difficult, but it has a small tick of having multiple access points to one feature, which can make the process feel repetitive.

On the other hand, FreshBooks offers a fresh perspective to accounting, allowing even freelancers without accounting experience to navigate and control their online payments and payment processing without the hassle of reaching out to an accountant every five minutes.

The navigation is intuitive, and the pop-up method offers user-friendly and quick learning advantages for users. 

Winner: 

FreshBooks wins the ease of use category, no contest. FreshBooks offers a user-friendly interface and a fresh approach to accounting that keeps users learning in an engaging fashion how to work around the various features within the app.

FreshBooks vs Xero online versions

Both FreshBooks and Xero offer online services and are cloud-based accounting software that can be used on the go. They offer secure cloud-based protection.

Winner: 

It's a tie.

Xero vs FreshBooks desktop versions

Xero does not have a desktop app. You can only use Xero online when working on your laptop or desktop.

FreshBooks has a desktop app.

Winner: 

FreshBooks wins this category.

Mobile apps

Xero provides mobile apps for iPhones and Android devices. While they have an app for the iPhone, they have three for their Android counterparts. The first is a mobile version for the online platform. The second and third are Xero Projects and Xero Expenses, both used for more fieldwork.

FreshBooks has mobile apps, too, an Android app and one for iPhones.

Winner: 

Briefly explain why they won here

Time tracking

Xero used a timesheet that can be used to track time at a location, but it is not often considered its greatest strength, and there are provisions for integration options.

FreshBooks has its time tracking feature, considered one of the best in its class of accounting software. This feature is available on all pricing plans.

Winner: 

FreshBooks takes the win here for its more consistent time-tracking feature.

Integrations

Xero grants users access to 800+ integrations to third-party apps to improve the overall running of your small business. Xero also connects with Zapier giving access to more add-ons. Xero also provides APIs for developers. Xero can integrate with PayPal, Shopify, and other known e-commerce options.

FreshBooks offers almost the exact same integration features as Xero including offering developers APIs and integrating with Zapier for more add-on access. Where it falls behind is its original integration options as it grants about 100 integration to third-party apps.

Winner: 

Xero takes the win here as it has more integration options than FreshBooks.

A note on FreshBooks Xero integration

Unfortunately, there’s no native Xero FreshBooks integration. The integration between Xero and FreshBooks can be set up through a third-party integration service called Zapier. 

With Zapier, you can create automated workflows that connect Xero and FreshBooks, allowing you to transfer data seamlessly between the two platforms. 

Product limitations

Even the best accounting software is not without limitations, and for these two, considering these limitations could determine your eventual choice.

Xero's first major shortcoming is the arrangement of its pricing. Xero's essential business features are under the more expensive plans, and its introductory plan is a funnel to drive people higher up the ladder.

Another limitation is the payroll option. Xero payment processing is hampered because payroll is more of an add-on and does not come built with the app or online software.

FreshBooks, on the other hand, has the restriction of business size. FreshBooks is not scalable for larger businesses. If your business is already experiencing a growth spurt, FreshBooks might not be able to meet the customization demands that alternatives like QuickBooks online can.

The size constraint also puts a strain on the addition of new team members. You would have to pay $10 per member, which tends to be on the more expensive side.

Winner: 

This category ends as a tie. 

Invoicing

When it comes to small business accounting, creating invoices is one of the key accounting features that endear small business owners to an accounting provider amongst other providers. 

Without mincing words, FreshBooks has a more robust invoicing option for freelancers and small business owners, as it provides unlimited invoices at its cheapest pricing plan.

Xero limits users to 20 invoices per month on its basic plan while its other two plans offer unlimited invoicing access.

Winner: 

FreshBooks easily takes this win as users on its first tier can enjoy the unlimited invoicing option.

Bank Reconciliation 

Bank transactions can easily go awry if not properly monitored, and more accounting software services are beginning to provide bank reconciliation options within their accounting tools.

FreshBooks comes with this option, and you can match your FreshBooks account to your Bank Account and monitor entry for entry.

Xero also provides this option allowing users easily access the bank reconciliation feature via the reconcile tab, which allows you to match various online payments both on your FreshBooks account and your bank statement too.

Winner: 

It's a tie, although Xero might get the lead for ease.

Is Xero better than FreshBooks? Our Final Points.

To categorically pick which is better between FreshBooks and Xero is a difficult task as both accounting services have proven to appeal to people for different reasons.

FreshBooks is ideal for the freelancer or solopreneur just coming to terms with budgeting, amongst other financial knowledge needed to run a small profitable business.

On the other hand, Xero works well with startups that have hit the ground running and possibly have an employee with a good grasp of accounting. 

Xero and FreshBooks are just among many accounting software solutions that can be used to manage your e-commerce business and other businesses. Other great options you could try out include QuickBooks online, Zoho Books, and Stripe.