Insights From Our Software Advisors: Stand Out in Accounting

Tools buyers are replacing with accounting software

When our advisors asked buyers what methods they were currently using to handle their day-to-day accounting operations, here's what they found:

• 66% of buyers already have accounting software to handle their daily operations, while a still sizeable 46% rely on non-specialized tools, such as billing and invoicing and bookkeeping tools, to perform accounting tasks.
• 7% of buyers have no particular method, and another 9% rely on manual processes such as spreadsheets and a paper-based approach.

Many SMBs still use HR, payroll, or employee management tools to manage accounting tasks, which are not built for financial workflows. These workarounds, along with manual methods like spreadsheets, often lead to reporting delays, data gaps, and compliance risks as operations grow.

Dedicated accounting software solves this by centralizing financial tasks, improving accuracy, and streamlining audits. It helps businesses move away from fragmented systems and maintain control as they scale.

Why buyers switch to accounting software

Our advisors spoke with buyers who are currently using manual methods or third-party software and are seeking a switch to dedicated accounting software. These discussions shed light on businesses’ real-life pain points, including inefficiency (28%), limited functionality (24%), and higher cost (19%) related to their existing tools.

• Inefficiency: Manual processes slow down reconciliation, reporting, and approvals. Errors creep in, deadlines are missed, and financial visibility suffers, especially as transaction volumes grow.
• Limited functionality: Generic tools often lack accounting-specific features like automated journal entries, tax calculations, and audit trails. This forces teams to rely on multiple systems, increasing complexity and amplifying risk.
• Higher costs: Using several disconnected tools or customizing non-financial systems for accounting tasks drives up expenses. Businesses end up paying more for workarounds that still fall short on accuracy and compliance.

From our interactions with buyers, it’s clear that many vendors miss the mark in showing how their software improves accountants’ daily workflows. Compared to manual methods and non-specialized tools, dedicated accounting systems offer clear, purpose-built advantages, including:

• Centralized financial data: All transactions, reports, and records live in one system. This reduces duplication, improves accuracy, and makes audits easier to manage.
• Real-time visibility: Built-in dashboards and reporting tools help leaders track cash flow, expenses, and revenue trends without waiting for manual updates.
• Automation: Tasks like invoicing, reconciliation, and tax calculations can be automated, saving time and reducing the likelihood of human error.
• Compliance support: Many platforms include features to help meet regulatory requirements, such as audit trails and tax reporting tools, which are critical for avoiding penalties.
• Scalability: As businesses grow, dedicated accounting software can handle increasing transaction volumes and integrate with other systems like payroll or inventory platforms.

What accounting software features are valued the most

When evaluating accounting software, our advisor conversations and review analysis reveal a gap between what buyers seek and what current users value most.

• Buyers request financial reporting (73%) the most, followed by billing and invoicing (36%), expense management (12%), budgeting and forecasting (10%), and payroll management (7%) features.
• Only 36% of current users find financial reporting important. Instead, they focus more on billing and invoicing (31%). This difference reflects the importance of having proper billing and invoicing functionality in place to manage daily operations. 
   

This gap highlights a key insight: Buyers tend to focus on features that support long-term financial oversight, while users value tools that streamline everyday accounting tasks.

• Financial reporting helps businesses generate key financial statements like profit and loss reports, balance sheets, and cash flow summaries. It provides visibility into performance, supports compliance, and enables leaders to make informed decisions based on accurate data.
• Billing and invoicing features automate invoice creation, track payments, and send reminders for overdue bills. They ensure timely collections, reduces manual errors, and help maintain healthy cash flow without relying on spreadsheets or separate billing tools.

Use cases for accounting software

Beyond traditional accounting teams, dedicated accounting software supports a wide range of industries—from manufacturing and maintenance to health and nonprofit—each with distinct workflows and specialized feature needs. For example:

• Non-profit organizations use accounting software to manage donations, grants, and program budgets. Built-in reporting tools help track fund allocation and ensure transparency with stakeholders.
• Accounting and CPA firms rely on these systems to handle client bookkeeping, tax preparation, and financial audits. Automation features reduce manual work and improve accuracy across multiple accounts.
• Manufacturing businesses leverage accounting tools to monitor production costs, manage inventory valuation, and track vendor payments. Integration with supply chain systems helps maintain profitability and reduce waste.
• Healthcare and social services adopt accounting software to manage patient billing, insurance claims, and grant funding. Compliance features support regulatory reporting and financial oversight.
• Maintenance and field service teams benefit from tools that track service invoices, technician expenses, and recurring billing. Mobile access ensures real-time updates from the field, improving cash flow and accountability.

Average budgets for accounting software across industries

Businesses across the top five industries are willing to allocate an average budget of $100 to $182 per user, per month. In comparison, the overall average budget for purchasing accounting software is about $100 per user, per month.

However, the budget for accounting software varies across segments depending on factors such as deployment model, integration needs, number of users, customization level, and required features.

Here’s how different industries budget (in USD; per user, per month) for accounting software.

Buyer goals and challenges—what advisors are hearing

Sourcing managers and purchasers in the accounting space often come with specific expectations and recurring questions that reflect their unique operational needs. Through direct conversations with our software advisors, we’ve gathered insights into buyer behavior and their tasks, revealing patterns in their priorities, challenges, and decision-making criteria.

• What problems are buyers trying to solve with accounting software?
  Many buyers are trying to move away from outsourcing depreciation tracking to CPA firms, which can cost thousands annually. They’re looking for accounting software that helps them manage assets internally, save money, and reduce reliance on spreadsheets—which often become too complex and error-prone as the business grows.
• Who typically needs accounting software?
  Accounting software is primarily used by finance professionals—think CFOs, controllers, and accountants—who need tools to track depreciation, financial reporting, and compliance. Operational roles like production managers usually don’t engage with these systems unless there's a crossover into maintenance or asset tracking.
• What misconceptions do buyers have about accounting software?
  Buyers sometimes expect accounting software to handle tasks like IT asset management, maintenance scheduling, or contract tracking. These features typically fall outside the scope of core accounting systems and may require separate tools or integrations. This confusion often surfaces during initial conversations.
• What integrations do buyers expect with accounting software?
  Buyers often want accounting software to integrate with project accounting tools for tracking budgets and profitability, especially in industries like construction or architecture. Expense tracking and tax book features are also common asks, particularly around tax season when depreciation reporting becomes critical.
   

Recommended actions for accounting software vendors

Here are five strategic actions vendors can take to better meet buyer expectations and stand out in a competitive market:

1. Showcase financial reporting and billing as dual priorities: Buyers request financial reporting (73%) most during purchase, while users value billing and invoicing (31%) for daily operations. Highlight how your software supports both strategic oversight and operational efficiency. Use real-world examples to show how businesses manage cash flow and generate accurate reports.
2. Solve inefficiencies with automation and centralization: Notably, 28% of buyers cite inefficiency, and 24% say limited functionality is a reason for switching. Emphasize how your software automates reconciliation, tax calculations, and journal entries. Demonstrate how centralized financial data improves accuracy and simplifies audits.
3. Be onboarding-friendly and support-driven: Many SMBs hesitate to switch due to setup concerns. Position your onboarding experience as a strength—offer fast implementation, intuitive training, and responsive support. Use client testimonials to build confidence and reduce buyer hesitation.
4. Make sure you’re integration-ready and compliance-focused: Buyers expect integrations with payroll, inventory, and project accounting tools. Highlight how your software connects with existing systems and supports compliance through audit trails and tax reporting features. These capabilities are especially critical during tax season and audits, so double down on the benefits.
5. Be transparent and pricing-aligned: Clearly display your pricing, aligning with the average budget of $100–$182 per user, per month. Help buyers shortlist your tool by benchmarking against trusted resources like the 2025 Capterra Shortlist for accounting software. Whenever possible, offer tiered plans to match different business sizes and needs and allow for room to grow and scale.
    

Rise above your competition with strategic insights

Accounting software vendors face intense competition in a crowded market. With the right insights, you can identify buyer priorities and pain points, then tailor your messaging to address them directly and capture attention.

With more than 10 million active software buyers on our sites every month, Gartner Digital Markets can equip you with the strategic insights you need to level up your marketing strategy and become a leader in your category.

Log in to your Gartner Digital Markets account and optimize your profile to ensure buyers understand how your software meets their evolving needs.

Once your profile is ready, use this guide to build a high-quality sales pipeline and this resource to master follow-ups that convert leads into customers.

Methodology and buyer demographics

Findings are based on data from conversations that Gartner Digital Markets’ advisor team has daily with software buyers seeking guidance on purchase decisions. The data used to create this report is based on interactions with small and midsize businesses seeking accounting tools. For this report, we analyzed approximately 3,150+ phone interactions from Sept. 19, 2024, to Sept. 19, 2025.

The findings of this report represent buyers who contacted Gartner Digital Markets and may not be indicative of the market as a whole. Data points are rounded to the nearest whole number.

The buyers we interacted with are largely small businesses representing a growing majority of accounting software purchases. Below you’ll find the demographics of the buyers so you can see the size and type of businesses, from annual revenue to industry.