Let’s cut to the chase. You’re here because you’re looking for online bookkeeping services. You’re tired of losing an hour (or four) each week tending to the books yourself, or outsourcing it to a bookkeeper who still insists you send him boxes of receipts.
In other words, you need a better bookkeeping solution—quick.
But that doesn’t mean you’ll should go with just any service. Before you make the switch, you need to know what options are out there. Since your time is money, we’re here to help narrow down your search. From key offerings to pricing, we’ve created a side-by-side comparison of one of the top bookkeeping solutions, Bench, and our own services, OpenDigits. No fluff, just a simple guide to choosing between two popular online bookkeeping services.
Online Bookkeeping Services: Bench vs. OpenDigits
As you probably know from a quick google search, there are a lot of different online bookkeeping services out there. But who has the time to comb through all those search results? Instead, we’ll break down the differences between OpenDigits and one of the most popular online bookkeeping services, Bench.
To start, here is how the two online bookkeeping services stack up against one another:
|Bookkeeping Method||Cash-Basis Bookkeeping||Cash-Basis Bookkeeping
Knit Payroll/OnPay Payroll
|Payroll Services||No||Yes (add-on)|
|Tax Planning Services||No||Yes (add-on)|
|Professional Valuation Services||No||Yes (add-on)|
|Monthly Financial Statements||General Ledger Reports
Blaance Sheet Statements
|General Ledger Reports
Balance Sheet Statements
Profit and Loss Statements
Cash Flow Statements
|Pricing||Starter: $145/month (below $1k expenses)
Micro: $175/month ($1k to $7.5k expenses)
Boutique: $245/month ($7.5k to $20k expenses)
Venture: $345/month ($20k to $60k expenses)
Corporate: $445/month (up to $1 million expenses)
|Tier 1: starting at $305/month ($15k to $50k expenses)
Tier 2: starting at $485/month ($50k to $120k expenses)
Tier 3: starting at $725 (from $120k expenses)
|Best For||Small businesses with straightforward financials||Mid to large startups focused on growth|
Of course, there’s only so much you can take away from a comparison chart. To fully explain the differences between these online bookkeeping services, we’ve broken things down based on the elements that matter most to entrepreneurs (aka you).
Features: Bench vs. OpenDigits
When it comes to online bookkeeping services, pretty much every company out there will cover the basics. These companies will organize and manage your company’s books for you, which includes categorizing transactions, reconciling your accounts each month, and producing important financial statements. Both Bench and OpenDigits have all your standard bookkeeping bases covered.
However, you’re probably looking for a little more than just the basics and this is where Bench and OpenDigits start to differ.
Believe it or not, but there are two different ways to do bookkeeping: cash vs accrual accounting. Cash-basis bookkeeping, only recognizes revenue and expenses when money changes hands. In other words, nothing goes on the books until it is deposited or withdrawn from your account.
On the other hand, accrual-basis bookkeeping recognizes revenues and expenses when they’re incurred. That means that revenue is recorded when its earned (rather than deposited in your account) and expenses are recorded when they are billed (rather than when they are paid).
Though the differences between the two methods may seem minor, they can have a big impact on how you run your business. Accrual-basis bookkeeping generally provides the most accurate picture of income and expenses because it keeps track of all financial transactions, even when money hasn’t changed hands yet. Accrual-basis bookkeeping is particularly important for startups as it is preferred by most investors.
OpenDigits offers both cash-basis and accrual-basis accounting, to help companies better understand their financial picture as they grow. Bench only offers cash-basis bookkeeping, which can be limiting for certain kinds of businesses such as startups.
Most business owners know that bookkeeping is just one piece of the financial puzzle. On top of keeping the books, you also have to file taxes and run payroll for your company. In other words, there’s a lot more to back-office admin than meets the eye.
Bench is primarily focused on bookkeeping and does not offer either payroll or tax preparation. However, Bench does have a network of accounting partners and will put you in touch with an experienced CPA to prepare your tax return for you. Just keep in mind that this will cost extra.
On the other hand, OpenDigits bookkeeping services come with the option to add-on payroll and/or tax planning. On the payroll side, OpenDigits uses its own proprietary payroll software, which has been used to process more than $25 million in payroll, to date.
OpenDigits also offers in-house tax planning services for Canadian companies. For US-based companies, OpenDigits works with a network of trusted accountants to provide tax planning referrals.
OpenDigits also offers startup-specific add-ons such as professional valuation partners. These experts can provide accurate startup valuations for companies trying to raise capital.
Technology: Bench vs. OpenDigits
Ever since the early days of cloud accounting, technology has become a big part of online bookkeeping services. Naturally, most business owners want technology that can automate the bookkeeping process, while also maintaining accuracy.
To accomplish this, Bench uses its own proprietary solution, while OpenDigits relies on industry-leading cloud accounting software such as Xero (and QuickBooks Online in some cases). While this may seem like a small point of difference, the software uses to house your books can actually have major implications.
Freedom to Switch
Let’s say that one day you decide to switch bookkeepers. With OpenDigits, all of your information is stored in easily accessible software, making it quick and seamless for any other bookkeeper to plug in and access all of your data.
However, if you are using Bench and decide to switch bookkeepers, all of your data is stuck in their own system. The data will not be available in an easy-to-import format, making it difficult for a new bookkeeper to take over.
As mentioned previously, there’s more to running a business than just taking care of the bookkeeping. This means you’re probably using other types of software that you’ll want to integrate with your bookkeeping software so that all of your financial information is in one place. Because OpenDigits uses industry-leading software solutions, connecting all your different platforms is a breeze.
However, with Bench’s proprietary software, integrations are only supported for specific platforms such as Strip and Gusto payroll. This means that while some integrations are possible, your options are far more limited.
Pricing: Bench vs. OpenDigits
Price is always a consideration for business owners—even those with plenty of investor cash burning a hole in their pocket. However, it’s important to keep in mind what you’re getting for the price you pay and whether the service aligns with your business needs.
Both Bench and OpenDigits’ pricing packages are based on monthly expenses. This is because monthly expenses are a good indicator of your bookkeeping needs and how complex your financial situation is.
With Bench, there are five different pricing plans for businesses based on monthly expenses. These plans start at $145/month and go all the way up to $445/month. All of these plans include cash-basis bookkeeping and standard financial statements.
OpenDigits offers three plans based on monthly expenses, starting at $305/month and going up to $725 per month. All plans include accrual-basis bookkeeping, monthly financial statements, and a dedicated in-house accountant to manage your account.
Best Fit: Bench vs. OpenDigits
From the above, it’s pretty clear that there are major differences between these two popular online bookkeeping services. This is actually a good thing because no two businesses are alike and each business will require very different bookkeeping solutions.
But which one is right for you?
Put simply, Bench is a great fit if you’re a small business with a very straight-forward financial situation. Think, your local yoga studio or a boutique marketing agency.
On the other hand, OpenDigits is specifically designed to meet the needs of growing startups—whether they’re pre-funding or adding their 50th employee. If this sounds like you, feel free to get in touch:
Of course, you know your business best, and hopefully this guide to online bookkeeping services gives you the extra insight you need to make an informed decision.