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How to choose accounting software for a small shop

Every option looks the same in a screenshot. Four tests you can run in an afternoon that separate software that will fit your counter from software that will not.

9 min read

A feature list against four tests that matterA generic list of features beside four specific questions, two of which the candidate fails.The feature listevery app has oneYour four testsBills with no signalBills in your currencyStaff cannot see marginsYour data exports outrun them on a real day

In short

  • A feature list cannot separate two products. Four tests run on your own counter can.
  • Test with a real day's takings, not the demo data — the demo is built so nothing goes wrong.
  • Ask how your data comes out before you put any in. An export you cannot get is a decision you cannot reverse.
  • The right answer for a two-person shop is usually not the right answer for a twenty-person one, and no product is honest about both.

Every accounting app looks competent in a screenshot. The screenshot is taken on a good connection, with tidy demo data, on a device the company chose. Your counter is none of those things — which is why choosing on features is how shops end up switching twice in a year.

What follows is not a comparison table. It is four tests you can run yourself in an afternoon, on any product including this one, and what each of them is really asking.

A feature list is the same on every product's site. The four questions on the right are the ones that differ, and they are answerable in an afternoon.A generic feature list beside four specific tests, two of which the candidate fails.The feature listevery app has oneYour four testsBills with no signalBills in your currencyStaff cannot see marginsYour data exports outrun them on a real day
A feature list is the same on every product's site. The four questions on the right are the ones that differ, and they are answerable in an afternoon.

Test one: turn the internet off, then sell something

Put the phone in aeroplane mode and raise a bill. Not open the app — complete a sale, print or share it, and take the payment. This is the single most useful five seconds of testing you can do, because it separates software that treats your counter as the source of truth from software that treats a server as the source of truth.

The difference only shows up on the day it matters. A shop with a good connection six days a week will not notice until the seventh, when there is a queue and the app is showing a spinner. If the sale cannot be finished offline, everything else about the product is a secondary consideration.

Test two: check the currency before you check anything else

Sign up and look at the first bill. Is it in your currency, or in the currency of the country the software was built in? This sounds trivial and it is not: an app that quietly defaults everyone to one currency is telling you that the people who built it had one market in mind, and you will keep meeting that assumption in the reports, the number formatting and the tax fields.

Khata resolves a currency from the country you choose at signup, for every country in the world, because the country a business trades in is a fact rather than a guess. That was not always true here — it defaulted everyone to Indian rupees until a shop registered from the UAE and was created billing in INR, which is how the problem got found.

Test three: make a staff login and look at your own margins

Create a second user with a cashier's role. Then, logged in as that user, try to find what an item cost you. If you can, then everyone on your counter can see your buying price, your supplier terms and your margin on every line.

This is the test most products fail quietly, because permissions are usually built as an afterthought — a single 'staff' flag that hides a menu rather than a rule that hides a number. Check the report screens as well as the product screen; the cost price often survives in a report that nobody thought to lock.

A cashier should be able toA cashier should not be able to
Raise and print a billSee purchase price or margin
Take a payment against a balanceDelete a completed bill
Look up what a customer owesChange another person's entries
Add a new customer at the counterExport the whole customer list

Test four: get your data out before you put it in

Before you enter a single real customer, find the export. Download your products, your parties and your balances, and open the file. If the export does not exist, or arrives as a PDF, or requires a support request, you are being asked to make a decision you cannot reverse.

This is the one test where the answer matters more than the product. A shop that can leave has a supplier. A shop that cannot leave has a landlord.

The questions that are really about size

Most disagreement about which accounting software is best is actually disagreement about how big the shop is. Three counters and a storeroom is a different problem from one person behind a till, and a product that suits one will feel wrong for the other in opposite directions — too heavy, or too thin.

  • One or two people, mostly cash, some credit: you need billing, a khata that keeps a running balance per person, and stock counts. Anything more is setup you will not maintain.
  • A counter with hired staff: permissions stop being optional. So does knowing which person entered an amount.
  • Several people entering at once, or a back office: you need somewhere that is not a phone — a screen where a hundred rows are corrected at a time rather than one bill at a time.
  • Registered and filing regularly: your accountant's requirements now outrank every other consideration on this list. Ask them first.

When Khata is not the right answer

It is worth being direct about this, because a page like this one is usually written to arrive at a single conclusion. Khata is a poor fit in four specific situations, and all four are things it does not do rather than things it does badly.

  • You need e-invoicing or IRN generation. Nothing in Khata produces one. If your turnover puts you in that bracket, this is a hard stop rather than an inconvenience.
  • You sell things with a batch number or an expiry date — medicines, most food distribution. The product record has neither field, which is why there is no pharmacy page on this site.
  • You sell the same item in sizes or colours and need to track them separately. There are no variants, so each becomes its own product.
  • You run several branches and want them as one business with separate books. Khata does not do multi-branch; running them as separate accounts and adding up the exports is the honest workaround, and for some shops that is too much friction to accept.

If none of those describe you, run the four tests above on Khata and on whatever else you are considering. The tests are the point. The conclusion is yours.

A sensible order to do this in

  1. 1

    Write down what actually goes wrong today

    Not features you want — problems you had this month. Balances you could not remember, stock you ran out of, a bill someone disputed. Three or four is enough, and they become your test list.

  2. 2

    Install two candidates, not five

    Five means you compare none of them properly. Two means you can run a real day on each.

  3. 3

    Run one real day on each

    Your own products, your own customers, your own takings. Demo data is built so that nothing goes wrong, which is precisely the wrong test.

  4. 4

    Export from both before deciding

    Do this while you still have very little in there. It is the cheapest possible moment to discover the export is bad.

  5. 5

    Keep the old system for a month

    Carry over balances, not history. Run both until the numbers agree, then stop. A month of overlap costs far less than a lost ledger.

Common questions

What is the best accounting software for a small business?

There is no single answer, and any product that tells you it is the best one is telling you about its marketing rather than your shop. What separates the options is fit: whether it completes a sale when the connection drops, whether it bills in your currency, whether a cashier can be stopped from seeing your margins, and whether you can get your data out again. Run those four tests on a real day of trading and the shortlist usually reduces itself to one or two.

Do I need accounting software or just a billing app?

If you only ever take cash and never give credit, a billing app is enough. The moment you have people who owe you money, stock worth counting, or staff on the counter, you need the record behind the bill — what is owed by whom, what a thing cost you, and who entered it. That is the difference, and it is why most shops outgrow a pure billing app in the first year.

Is free accounting software safe to use for a real business?

Free is not the risk; not being able to leave is. Before you commit, confirm three things: that you can export your customers, products and balances in a format you can open, that your data is not visible to other businesses on the same system, and that somebody answers when it breaks. A free product that passes all three is safer than a paid one that fails the first.

How long should switching accounting software take?

Plan an evening for the setup and a month of overlap. You carry over your customer balances and your products, then run the new system alongside the old one for a few weeks until you trust the numbers. Shops that try to switch overnight are the ones that lose balances, because the old system is usually turned off before anyone notices what did not come across.

What should I check before putting my customer data into an app?

Ask where it is stored, who inside the company can see it, how you delete it, and how you get it out. A straight answer to all four is itself a signal. If the answer to 'how do I export my customer list' is a support ticket rather than a button, treat that as a cost you have not been shown.

Khata is free to use

Billing, khata, stock and reports on your phone. No card, nothing to cancel.

See what you get

accounting softwarebilling softwarechoosing softwaresmall businesskhata

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