QuickBooks vs Microsoft Dynamics 365 Business Central

Both QuickBooks and Microsoft Dynamics 365 Business Central are software solutions that provide accounting functionality for businesses. They each can provide the core functionality you need to handle basic accounting in a small business. But beyond that, the two solutions are worlds apart.

Overall, QuickBooks tends to be more suitable for simple small businesses or micro-businesses, whereas Dynamics 365 Business Central fulfills the more complex needs of growing small businesses and mid-size businesses. In fact, many businesses start on QuickBooks and then transition to Business Central once their needs grow.

In this article I’m going to break down some of the differences between the two products and discuss when you might choose QuickBooks vs Microsoft Dynamics 365 Business Central.

QuickBooks vs Dynamics 365 Business Central

QuickBooks

QuickBooks is owned by Intuit, and it has been available for a long time — “Quicken” was a product of Intuit’s way back in 1983. QuickBooks has some good payroll and credit card processing add-ons, which are a big part of the QuickBooks solution.

QuickBooks is available in a number of different versions: QuickBooks Online Plus; as well as QuickBooks Enterprise Solutions Platinum, Gold, and Silver. You get increased functionality as you move up the chain, including advanced reporting, payroll, inventory, and pricing.

QuickBooks Strengths

One of QuickBooks’ strengths is its longevity and market presence. Their Wikipedia page states that they had a 74% small business market share back in 2005. You’d be hard-pressed to find an experienced accountant that has never relied on QuickBooks. The support, public knowledge, and community is quite strong surrounding the QuickBooks product. This could help you in reducing training costs.

QuickBooks has a full range of options for deployment. You can run the solution in a “single-tenant” configuration, which means you can move the app from hosting in a private cloud to a public cloud, if necessary. It is also quite easy to buy and set up QuickBooks without any help.

Compared to Dynamics 365, QuickBooks definitely has two more key advantages: easily integrated payroll and payment processing. As I mentioned, core areas of Intuit’s business include the payroll and merchant services add-ons. Since these features are great sources of revenue for Intuit, they are well integrated into the QuickBooks platforms. (However, you are restricted to the OEM tools that QuickBooks offers.)

While Dynamics 365 Business Central has a variety of apps to address both these needs, it takes more work to set them up.

QuickBooks Weaknesses

Despite its strengths, QuickBooks is still generally considered a piece of accounting software for “micro-businesses.” This means that it lacks the full range of options required by many SMBs and growing companies. Some of its worst faults include

  • Weak user roles and security options — it’s too easy for mistakes to be made and for users to have improper access to data.
  • Not-so-robust audit trails — no record of logins/logoffs, and no record of changes to master records.
  • Limited/inconvenient reporting options — general difficulty across customer insights and analytical capabilities.

These weaknesses can leave businesses on QuickBooks vulnerable to losses due to errors and even employee theft. That vulnerability can grow exponentially as your team grows.

Furthermore, QuickBooks is not scalable. If you are a business that is growing, has plans to grow, or has already grown — you will find that the architecture of the QuickBooks database is insufficient. When you approach 1000 transactions/month or multiple users accessing the system at the same time, QuickBooks gets slower and slower. In addition, QuickBooks doesn’t have multi-lingual functionality, which limits international growth.

Finally, QuickBooks is missing a number of key features that a lot of accountants consider necessary. They have limited options for billing formats, and you will have difficulty billing third parties or different client locations. Also, QuickBooks is inadequate for inter-company reporting. You also can’t work with deferred revenue or expenses in QuickBooks.

Microsoft Dynamics 365 Business Central Logo

Microsoft Dynamics 365 Business Central

When comparing Microsoft Dynamics 365 and QuickBooks, it’s important to make sure we’re looking at the right version of Dynamics 365. I’ll focus on the small and mid-size business app available from Microsoft: Dynamics 365 Business Central.

(There are many other apps within the Dynamics 365 family, which can help your business handle customer engagement, HR, and even enterprise-level ERP needs. You can learn more about Microsoft Dynamics 365 solutions here.)

Microsoft Dynamics 365 Business Central Strengths

Business Central has a number of strengths, but there is one advantage that really stands out when compared to QuickBooks: value. Microsoft claims that Business Central has almost 800 features that QuickBooks Online Plus does not have. In fact, Business Central has the functionality to address all of the QuickBooks weaknesses that I outlined above; and it really goes above and beyond when it comes to scalability and reporting.

When comparing Dynamics 365 user pricing to QuickBooks pricing, you’ll find that Dynamics 365 rings in at $70 USD/user/month*; whereas QBES can cost up to $184 USD/user/month for the Platinum edition. (The “QuickBooks Online Plus” version is $40, but it has way less functionality).

Business Central Audit Trail and Reporting

Business Central’s audit trail is much more robust, better protecting businesses against errors and employee theft. For example, in Business Central, users have to reverse voided transactions rather than deleting them (whether accidentally or intentionally). This means there will be a valid audit trail.

In terms of reporting, Business Central’s capabilities are very extensive, letting you, for instance

  • use a web-based reporting portal
  • see open purchase orders and purchase comparisons in accounts payable
  • connect your data easily to a full reporting solution, Power BI
  • see salesperson performance analysis in order entry reports
  • give different data access permissions to different users

Business Central Integration with Microsoft Office

Business Central also has a big advantage in that is integrated with the rest of the Microsoft stack. If you use Microsoft Office, Outlook, Excel, or any number of other Microsoft products, you’ll be impressed by how easy it is to use — and how easily the data flows between applications. For instance, you can do quotes and invoices right inside Outlook, like this:

Business Central Invoice in Outlook

Microsoft Dynamics 365 Business Central Weaknesses

Overall, Microsoft Dynamics 365 Business Central is a full ERP, not just an accounting solution. This makes it more complex and comprehensive than is necessary or useful for very small businesses, say 5 employees or less.

Also, it bears mentioning once again that it’s a larger investment to deploy payroll in Dynamics 365 Business Central than in QuickBooks.

However, by doing payroll as part of a full ERP, through one of these Business Central apps, you can see precisely how much of your labor costs come from different projects, departments, or any other dimension in Business Central. And the app model gives you more choices in terms of who you want to do business with as well as the depth and breadth of features and functions.

Business Central – On-Premise Has Fewer Advantages

Business Central can be deployed either in the cloud or on-premise. However, the on-premise option has fewer data security benefits, requires more frequent attention by your IT team, and requires more cost over the long run.

For regulatory or other reasons, some businesses really need the option of working on-premises only. Going with Business Central On-Premise means paying for your own servers, plus a place to store them, electricity to power them, etc. You also will have to pay for future updates instead of receiving those freely and automatically from Microsoft.

It also means that instead of your data being protected in Microsoft’s Azure Cloud, it’s protected by your own IT team. Business Central’s audit trail and data permissions functions, which I discussed above, still work fine and do improve your internal security. But being on-premise leaves you less well-protected than does the cloud against cyberattacks like ransomware.

So companies considering moving to Dynamics 365 Business Central should be aware that they’ll get the most out of Business Central if they are among the majority that can go to the cloud.

Business Central Implementation

Another major difference between Business Central and QuickBooks is the investment required to set it up. Because Business Central brings together so much of the data and processes in your business, it takes time and the help of professionals to import your data, train your staff, and implement the solution.

This means the price of implementation depends on the needs of your business. However, Encore Business Solutions does offer fixed-price packages starting at $12,500, which are likely to be a good fit for a business that has outgrown QuickBooks.

Comparison Table: QuickBooks & Dynamics 365 Business Central

Feature Microsoft Dynamics 365 Business Central QuickBooks
Overall Functionality Very Good Good
Scalability/International Accounting Good Poor
Deployment SaaS Only. However, See Business Central (on-premise) SaaS or On-Prem
Payroll Yes, Through Apps Yes, As Add-On
Reporting Very Good Okay
Security Roles & Auditing Good Poor
Credit Card Processing Yes, Through Apps Yes, As Add-On
Pricing/user/month  $70 $40 – $184

 

QuickBooks or Microsoft Dynamics 365: Which One is Right for You?

Overall, I would score a win for Dynamics 365 Business Central in most cases. There are a few scenarios in which you might choose QuickBooks, though:

  • Your company has five or fewer staff members.
  • You only have one or two accounting staff members (and you plan to keep it that way).
  • You or your accountant is deeply knowledgeable in QuickBooks, and you’re willing to continue training for new versions of QuickBooks rather than learning a new tool.
  • Regulatory concerns prevent you from hosting your data in the cloud.

You should probably choose Microsoft Dynamics 365 Business Central if:

  • You do more than 1000 transactions/month (or might get there in the next 6-12 months).
  • You have plans to expand to more than one country, or you currently operate in multiple countries.
  • You need to handle deferred revenue and/or expenses.
  • You place a premium on the reporting ability of a system.
  • You want your information to be auditable.
  • Security is a concern for you.
  • You want the want the efficiency gains from having your accounting solution truly integrated with Outlook and the rest of your Office suite.

To learn more, visit our Microsoft Dynamics 365 Business Central solution page.


* All pricing is subject to change without notice. Always contact Encore for the most current product pricing.

Which Dynamics Product Is Best for You?

Answer some basic questions about your company and your requirements, and find out what products would fit your business.

Take Our Quiz

Which Dynamics Product Is Best for You?

Take Our Quiz