The XERO Day Notice by Intuit (Quickbooks)

In recent days Intuit, the owner of QuickBooks has made a number of moves which seem to have seriously irritated a large number of accountants and bookkeepers. Given our work in the industry, where we help accounting and bookkeeping firms shine by digitising and automating their processes, it’s essential to know what is going in the market. And I have to say, the furore caused over the last 3 to 4 days, in the US has been unlike anything I’ve seen before.

So what is causing all this commotion within the accounting and bookkeeping community?

Firstly a few weeks back Intuit had announced their new Quickbooks Live Bookkeeping Service - indeed new accounts which are currently not linked to a Quickbooks Advisor are seeing the below. The service is said to be launching at $200/month

At $200/month the service seems to clearly undercut most bookkeepers in the industry. With price ranges starting easily from $2,000 and in some instances going into 5 figures; what is not to be enticed with a price which is at least 10 times cheaper.

Initially, while there was some commotion it was played down by most in that; this wasn’t direct competition. That there was no way Quickbooks would directly attack the partners who helped to build their empire in the first place, and secondly that they were likely to recommend low-ball / bad clients to this new Intuit service. Not everyone requires a level of expertise and service provided by professional bookkeepers and firms, especially when you are positioning yourself as a niche provider.

That sentiment started to change when, apparently, according to Intuit a technical mistake on their targeting. Clients that are working with Advisors and Bookkeeping firms started seeing this new offer on their QBO accounts when they started being hit with advertising. Hence this started feeling like Intuit suddenly decided to become the competition. So placing new clients on QBO or Intuit software, and providing the client information with access, it has started to feel that accountants and bookkeepers are now giving leads to Intuit on a silver platter.

Adding insult to injury a number of advisors have complained that scheduled lead calls are in some instances being cancelled as these new leads are coming across Quickbooks Live Bookkeeping, hence finding the solution to their problem. Hence, it is no surprise that the voice in the industry started to change.

This had led to a number of discussions across multiple people, of either switching providers, with others seemingly starting calls for Accountants to invest and co-own a new accounting product which would go head to head with Quickbooks.

What would it take to get a QuickBooks Online Parity Accounting Software? First and foremost accounting giants such as Intuit and XERO have invested millions to build the products they have today. It would be naive, to say the least, that a few hundred thousand dollars or a couple of million are likely to get the product on a par with these giants.

Yes, the barrier to entry has indeed lowered especially from a software perspective. But I have to ask, what would the software need to do for you to make the jump?

I have heard of people saying that a minimum viable product (MVP) is doable with a few hundred thousand dollars. Yes, that’s most likely going to be correct. However realistically speaking unless you have low-end clients with little to no work there is no way an MVP is going to cut it.

Why?

Because in most cases accountants use eco-systems and whole networks to get their work done, for example:

• Bank Feed Integrations for handling bank reconciliation
• AI Engines to match/guess bank reconciliation items
• APIs with hundreds of third-party apps that integrate.
• Expense Management
• Payroll
• Workflow / Job Management
• Cashflow Forecasting
• Payment Chasing

That is if the product is perfect and through the first time around, getting all the tools to get your clients moved over is still going to take a significant effort. And most importantly time - are the accountants willing to keep ploughing in money into Intuit, whilst investing in a product which will take years to mature and likely go over budget.

The underlying risk is that should this be an investment across a number of accountants; everyone would be entitled to their own say. On how the product should look, and what features they need to be done. And quite frankly that is a recipe for disaster. Should that go forward, it needs to be incredibly clear that there is a product manager to run the process. That shareholders have little to no say on the product, other than giving suggestions. And oh boy would that product manager be busy handling all of those. Hence I do feel that there is a large underlying risk that ultimately at launch a large majority of backers ( should it be done across a large number of stakeholders) would feel unhappy with the end result.

The XERO Day Notice

To add Insult to injury, as all this has been taken place. Intuit decided to play its next card.

A price hike.

The price hike across its major products, Quickbooks Online, Quickbooks Desktop and payroll - all available below - meant that this already disgruntled audience was given even more reason to consider options.

A few months notice was effectively given for existing accounts paid by advisors, whilst new accounts will start being charged the new rates in around a months time.

When contacting Intuit over this a number of accountants and bookkeepers were asked if they are looking to export, on pretty much their first interaction.

What this means, essentially is that Intuit has been having such a backslash over these changes that the requests to start exporting and planning a migration had already been coming in.

Within online conversations, this price hike notice was effectively dubbed the XERO Day Notice. Why, because essentially it’s the straw that’s broken the camel’s back - at least for quite a number of disgruntled accountants. And quite frankly XERO seems to be the primary player which is likely to make the most of this mass migration from Quickbooks.

What are the options, and what to look out for?

The US market, in particular, is quite rich in options. So to make your way out of Quickbooks it’s not going to be such a big deal. The challenge is however to find the right partner/solution to go forward.

I’m quite confident that most of those looking will fall into the right solution for their needs. The biggest challenge will be for those who already leverage full ecosystems around QBO, here the players in the market would be less.

Depending on your stack, they may support single or multiple accounting partners, and I believe that it should be your starting point. Find out what these systems work with and try out the complementary solutions. You don’t want to change 5 or so applications just because you want out on QBO, quite frankly it will be such a headache that likely status quo will win the game.

If you’re not yet leveraging connected apps; look at marketplaces, such as the XERO marketplace, it’s full of great software that can augment your XERO experience and give tonnes of value to both yourself and your clients.

And given their open API; if you can’t find something within the marketplace it can likely be built - through a network of developer partners, including ourselves, that provides custom application development to help businesses automate and simplify their workflows.

If you’re currently caught up in this XERO day notice by Intuit and want to learn more about how XERO and its ecosystem can help you move clients forward, hit us below and subscribe to our mailing list for regular updates on what’s happening within the XERO and Cloud Accounting industry spaces.