FreshBooks

FreshBooks recently made a bold move: It started from scratch with its popular online invoicing application. The new FreshBooks provides a much improved user experience in order to to make the site easier and faster to navigate, to improve collaboration, and to be able to rapidly deliver product enhancements. At the time of this writing, however, it is still missing some functionality of what the company is now calling FreshBooks Classic. The end result is an excellent online accounting service for freelancers and sole proprietors, but one that's not quite mature enough to take top honors—yet.

At this writing, old features not included in the new version include product and service records, inventory tracking, expansive customer records, and numerous reports. Additional features are expected to be moved over from Classic, while the new version offers some tools previously unavailable on the site. These future upgrades include bank reconciliation and non-invoice income recording, expanded reporting, and additional partner integrations. Current FreshBooks users can choose to stay on Classic or move to the new version, but anyone signing up will automatically be put on the relaunched website. FreshBooks is not double-entry accounting like its competitors, but its user experience and invoicing tools are exceptional.

Pricing and Setup

FreshBooks is available for as little as $15 per month for the Lite plan, which lets you bill up to 5 clients. For $25 per month, the Plus plan lets you bill 50 clients, and for $50 per month, you could bill as many as 500 clients with the Premium plan. Besides the numbers of clients served, all the plans offer the basic features, and you can try a 30-day free trial at any tier, too. Those are reasonable prices, but consider that Editors' Choice Wave is free.

Once you've signed up, it only takes a couple minutes to get started invoicing. You'll have to supply company contact details and select your industry from a list. You still have access to all the site's features no matter the industry you choose, but FreshBooks displays context-sensitive settings on some screens that are appropriate for your work—more on that later.

An Improved UI

The first screen you see after setup is the site's dashboard, which gives you a quick overview of your company's financial status. There are three charts. Outstanding Revenue tells you who owes you money and who is behind on payments. Total Profit, of course, gives you a real-time number for your current profit (or loss); you can change the date range for this graphic. And Spending displays your expenses by category. Links to six commonly used reports (Accounts Aging, Invoice Details, Time Entry Details, and so on) lie below these graphs. Unfortunately, you can't drill down on these as you can in Wave. Most competitors have moved or are moving in the direction of this kind of dashboard overview, since businesspeople want a quick first look at their overall income and expenses.

A vertical pane to the left of the dashboard displays navigational links to the core areas of the site: Invoices, Estimates, Clients, Expenses, Projects, and Time Tracking. Click the link above it, under your company name, and a list of site settings opens. Here you can, for example, contact support, add team members and contractors, and see your billing information. You can also set up two connections that are critical to FreshBooks operations. If you enter your login credentials for financial institutions at which you have accounts, FreshBooks connects to their sites and import your account transactions. You can start accepting credit cards by signing up for FreshBooks Payments or Stripe, but please note that fees apply.

Click the small bell icon in the upper left, and you get updates about your clients, team members and your business. In the upper right, are two drop-down arrows. One, marked Invite, takes you to links for adding employees or contractors to your FreshBooks account. The other, labeled Create New, displays a list of transactions and records you can enter directly from there, including invoices, clients, estimates, and expenses.

Overall, FreshBooks has one of the simplest, most intuitive screen displays of all the sites I've reviewed recently, along with Wave and Kashoo. It can, however, take a while for a user of the old FreshBooks interface to get oriented. This expert design continues through the entire site.

Creating Invoices

FreshBooks Classic had quite a busy user interface before the new site was introduced. Though it's not double-entry accounting like Less Accounting and other competitors, Classic had grown very rich and complex for a site that primarily let you create and manage invoices, expenses, and time. In fact, I thought it was the best of its breed, though its UI was getting overcrowded.

The new FreshBooks is startlingly simple looking in comparison. And while it still has a ways to go to move everything over, its designers have done a good job of tucking away features, as Intuit's designers have with Quickbooks Self-Employed. FreshBooks, however, has far more depth than it appears to at first glance, whereas Intuit's service is fairly light.

You discover FreshBooks' hidden depths the first time you create an invoice. The main invoicing screen conveys a lot of information without feeling overcrowded. At the top of the page is a small toolbar that toggles between invoices from you and to you (the latter would come from contractors). The screen's content changes as you click back and forth. When you're viewing information about invoices you've sent, you see dollar totals for those that are overdue, outstanding, and in draft form. Below those numbers are small page-like graphics that contain information about the invoices you've created most recently. And below that is a searchable table of all invoices.

Click the big green New Invoice button, and an invoice form appears, looking the way the customer will see it. Most accounting sites make this a two-step process. You create an invoice on one screen, and then you can preview its final, finished appearance. Your company logo and contact information appear at the top. Below that are some of the standard fields and links you'll find in invoice forms, though not as many as in the old FreshBooks Classic. If you've already created client records, you can select from a list of them. If not, you'll be able to add one on the fly. The only other fields there are designated for date of issue and date due, invoice number, and amount due.

Click Add a Line to add a service. Since the new version doesn't let you create records for service items or their rates, you have to enter that information the first time you invoice for a specific service. FreshBooks remembers it and adds it to the drop-down list. Next you specify a quantity and add any taxes and additional line items if necessary. If you want to add a discount or request a deposit, you can do so before saving the invoice.

Context-Sensitive Content

As you're working on invoices, FreshBooks displays links to context-sensitive settings over to the right of the screen. This is unique to FreshBooks. Other sites have one giant section of the site where you define all of its settings. It's a great feature. You can, for example, switch to a different invoice style here. You can also make the invoice recur at specified intervals, either automatically or manually. Others, like Less Accounting, offer recurring transactions.

If you're using a version of FreshBooks above Lite, you can have reminders sent at designated intervals and charge late fees, which is unusual in this group of sites. Once you've saved an invoice, you can open it again and edit it or click the More Actions button for tasks like emailing it or applying a payment. You can also click a link to view the invoice's history.

Estimates are new in FreshBooks, though Wave has offered them for a long time. You can create and manage them much like you did invoices.

Contacts and Expenses

Every small business accounting website has a section for contact records. You'll complete the fields on these much like you used to fill out paper Rolodex cards. Services like Kashoo offer much more detailed forms, but what FreshBooks offers should be fine for most of its users. When you click on the big green New Client button, the next screen displays a graphical representation of a paper card. You just enter each client's name, mailing and email addresses, and phone numbers. FreshBooks does something in addition that I've never seen a site do. It goes out and looks for a picture or logo online that matches your client's contact information. It worked for me when I entered live clients.

Once you've created a record, it appears in the list on the main Clients page. Click on one, and you'll see a history of transactions and other interactions. You can drill down on these entries to see the original forms.

If you've connected one or more bank accounts to FreshBooks, you see a list of recent transactions when you click the Expenses tab (you can also manually add new ones). FreshBooks tries to automatically categorize these (Professional Services, Supplies, Meals & Entertainment, Personal, and so on) when it brings them in, but it doesn't always hit the mark. You have to train it at first by correcting inaccurate categories.

To do so, you click on one in the list. A new screen appears displaying the expense as a strip of cash register tape. Click the big green Edit button, and you can modify anything, selecting from a drop-down list of categories and clicking the Apply to Future Imported Expenses link. You can also attach a file, such as a photo of a receipt that you took using FreshBooks' smartphone app. Wave offers this ability, too. Expense Settings off to the right include the option to mark the expense as billable to a client.

Simple Project Definition

If your small business works with projects, you can define them in FreshBooks. Give your project a name, assign it to a client or to internal staff, and enter an hourly budget and end date, if you'd like. Then you have the option to set a blanket billing rate for the project, either hourly or in total. If you're working solo and you're only charging one rate for your work on a project, that's fine. You can also invite employees and contractors to enter their own hours and share ideas within the project. Clients, too, can join in. FreshBooks handles team collaboration very well.

That said, you can't specify a project on an invoice, as you can in Kashoo. In fact, Kashoo devotes an entire page to each project, listing all related transactions and breaking them out by Net Income, Expenses By Account, Unpaid Invoices, etc. FreshBooks doesn't offer a similar comprehensive look at projects.

You can, however, assign time entries to projects in FreshBooks, so there is a way to track the hours spent. There are two options: start and stop a timer, or enter the hours manually by filling out the fields in a small window or grabbing the bars on a graphical timeline. The Time Tracking page lists all entries and shows hours worked by contributor in the timeline. This is viewable as a bar chart.

Awaiting Features

If you've never used FreshBooks before, you shouldn't have too much trouble learning how the new version works. Its design is exceptional and its navigation tools intuitive, but if you're a FreshBooks Classic user, I'd give it some time before moving over. There's just too much missing still, from product and service records to the rich variety of reports that were available in the previous version. Don't get me wrong, the new FreshBooks is already an excellent service, it just needs a little more time and development to bring it up the top spot. In the meanwhile, Wave wins our Editors' Choice for accounting services for freelancers and sole proprietors.