Every business owner needs good accounting software to properly manage and run their business, and the same holds true for those who operate in the cannabis and CBD industry. Finding the right accounting software for dispensaries is essential in this rapidly changing industry because accounting for a cannabis business is more complicated than for other companies. That’s because legislation and legal requirements are constantly changing as the billion-dollar industry grows and evolves.
So, what’s the best accounting software for dispensaries? Benzinga researched the options and provides a list of the best software below.
Best Accounting Software for Cannabis Dispensaries
Benzinga believes that FreshBooks is the best accounting software for dispensaries. That’s because the software is affordable and customizable, which means you won’t have to add unnecessary integrations for the cannabis industry.
QuickBooks is used in many industries, and the cannabis industry is no exception. The software features state-of-the-art mobile apps that allow you to conduct business from your office, home or on the go.
QuickBooks is known for its customer service support, and when you purchase one of its premier packages, you can email the customer service department a question and a representative will call you back with an answer. On the downside, QuickBooks does not offer a cannabis industry chart of accounts, so you will have to use an integration for that aspect of your accounting.
When looking for accounting software for dispensaries, the QuickBooks software you choose should be based on the size of your business and your plans for growth. Here are the QuickBooks programs to choose from:
- QuickBooks Online (QBO): If you are just starting your business, this is an affordable option. It provides evertthing you expect in business accounting software, including job costing, keeping track of expenses, invoicing, the ability to manage bills and to keep track of inventory. The downside to this software is the inventory feature isn’t as robust as other software options, and the program does not allow for dispensary owners to account for the various cannabis-related taxes such as local and state excise taxes. The software starts at $12.50 and goes up to $90 per month depending on the number of users and the features you require.
- QuickBooks Premier Plus Desktop 2022 (QBPD): This software package offers everything that QBO does but with a more robust inventory-management system. You can host this software in your office or in the cloud. Another bonus for cannabis dispensaries is that QBPD makes it easy to calculate cannabis-related taxes. The software package starts at $549.99 per year and goes up depending on which features you want to add. This is a great software package for small to medium businesses that are still growing.
- QuickBooks Enterprise 22.0: If you run a dispensary with multiple locations or you also grow or cultivate cannabis, this is probably the right QuickBooks software for you. It allows up to 40 users and can be customized to fit your business’s needs. It has six times the capacity of Premier Plus and offers more than 200 customizable reports so you can view your business operations at a glance. This software starts at $1206 a year and QuickBooks offers 10% off the first year’s subscription.
FreshBooks is another accounting software tool that is ideal for people in the cannabis industry. This software makes it easier for people who don’t have a lot of accounting experience to perform the necessary accounting tasks that come with running a business.
The software tracks your expenses, pays invoices, offers numerous reports such as cost of goods sold and profit and loss statements and allows you to reconcile your bank account and even track your time. You can add your accountant to the program for no extra charge on some of the plans, which makes tax time much easier. Also, because the chart of accounts feature is customizable, you won’t need to integrate another program to get it. The customer service department at FreshBooks is known to be world-class, so you will always have the assistance you need when using this software.
FreshBooks offers four levels of service depending on the number of features required:
- Lite: For businesses just starting out that only have five billable clients. Lite runs $4.50 per month.
- Plus: For those businesses that need more insight into their business health reports, including double entry accounting reports. You can invite your accountant to participate with you in this software. This software allows up to 50 billable clients and is accessible via computer or with a mobile app. Plus runs $7.50 per month.
- Premium: This software allows for unlimited billable clients and is for businesses that are growing and have need for more functions and insight. You can invite your accountant, run financial and accounting reports, access the software from your desktop or via a mobile app and set up reoccurring billing and client retainers. Premium runs $15 per month.
- Custom: People who run cannabis dispensaries may consider FreshBooks custom software package. With it, you can get unlimited billable clients and special features geared for your business. You must speak to a customer service representative about your needs and request a quote.
Xero is another great software choice for people who run cannabis dispensaries. You can use their easy-to-use interface on your computer or via the mobile app to get a picture of cash flow and accounts payable, pay your bills, track projects and their profitability, reconcile your bank account and view the accounting reports you need to successfully run your business.
You can also manage your payroll and accept payments with the software. Xero does not provide a cannabis industry chart of accounts, so you will have to use an integration or have your accountant build one for you. When you use this software, you will enjoy unlimited customer service online support 27/7.
Xero has three cloud-based plans for retail businesses such as dispensaries.
- Early: This is a starter plan and limits you to five bills and 20 client invoices and allows you to reconcile your bank account and see a snapshot of your short-term cash flow. It costs $12 per month, and you have the option of adding payroll capabilities to the plan for $39 more per month.
- Growing: These plans give you everything in the Early plan, but you can also send unlimited bills and invoices. It runs $34 per month, and you have the option of adding payroll capabilities to the plan for $39 more per month.
- Established: This plan is for more established businesses and offers the same features as above plus the ability to use multiple currencies, track your projects, claim expenses and view in-depth reports and analysis. This software runs $65 per month with the option of adding the $39 per month payroll feature to it.
4. Zoho Books
Zoho Books is accounting software that is easy to use and offers a full suite of accounting features. With this software, you can keep track of your inventory, receivables, payables, bank account and track your project’s time and costs.
You can use the software on your computer or the company’s mobile app. You can contact its customer service by phone 24/5 Monday through Friday.
Zoho Books offers six software packages:
- Free: You can get a free account with Zoho Books that allows you to have one user, up to 1,000 customizable invoices, multiple bank and credit card accounts, customized taxes and payment gateways. You will get email customer service support at this level. The cost is free.
- Standard: With this package, you get everything in the free plan plus you can have up to three users and 5,000 customizable invoices. You can also track project expenses and customize your views and fields, so you get what you need from your reports. It costs $10 per month, and you will have access to customer service email, voice and chat.
- Professional: This software gives you everything the Standard package does plus you can include five users and have access to stock tracking, project tracking, price lists, multi-currency handling, timesheet approvals and price lists. It costs $20 per month, and you will have access to customer service email, voice and chat.
- Premium: With this plan, you can have 10 users and three branches and in addition to everything the Professional plan provides, you will get a custom domain, vendor portal and custom modules and reports. It costs $30 per month, and you will have access to customer service via email, voice and chat.
- Elite: The Elite plan offers everything the Premium plan offers plus advanced inventory control, the ability to integrate up to two Shopify stores, warehouse management for up to five warehouses, batch and shipment tracking and the ability to print shipping labels. It costs $100 per month, and you will have customer service access via email, voice and chat.
- Ultimate: This plan allows up to 15 users and provides everything in the Elite plan plus 25 custom modules, advanced analytics, a dashboard that provides real-time reports, the ability to customize the dashboard and reports and then export them in Excel or as a PDF and create reports collaboratively with others. It costs $200 per month and you will have access to customer service via email, voice or chat.
If you are looking for the most affordable accounting software for your dispensary business, you can’t beat Wave. It is cloud-based accounting software that is absolutely free. It makes its money with its payment processing, payroll and one-on-one advisers, and that’s why it can offer its accounting software for free. Keep in mind that the software is only free for businesses that operate as sole proprietors, so as your dispensary grows, you may need to change. On the downside, Wave does not offer live customer support. If you have questions, you will have to interact with its Chatbot called Mauve.
Wave offers one free plan, and with it, you can track your income and expenses and create reports such as profit and loss, balance sheets and cash-flow reports. You can connect unlimited bank accounts and credit cards and can set up the software in minutes.
Benefits of Using Accounting Software
The benefits of using accounting software are numerous and will add to the success of your business:
- Understand your profit margins. You can’t understand how your business is doing until you know what profit margin you’re earning.
- Reconcile your bank accounts. No one who runs a business has extra time and that’s why people love the fact that accounting software can automatically reconcile your accounts.
- Keep the cash flowing. When you use accounting software to stay on top of your accounts payable and receivables, your business will benefit from improved cash flow.
- Plan for the future. When you can see how your business is doing financially, it makes it easy to make plans for the future.
How to Maximize Your Accounting Software
To make the most of your accounting software, think about implementing the following ideas:
- Train the users. Software is only as good as the people who use it, and that’s why it’s important that you train the people who will be using it.
- Conduct audits. To ensure your data remains consistently correct, conduct weekly or monthly audits to look for incorrect data or inconsistencies.
- Assign a ringleader. With data as sensitive as your financials, it’s important that there is a point person who is in charge. This will help keep the data flowing as it should and prevent any unwanted mishaps.
- Customize. If your software can be customized, do it. Because the cannabis industry is more complex than most, customizing your reports and fields will result in less work and better data.
Frequently Asked Questions
Can I use QuickBooks for cannabis?
Yes, you can use QuickBooks for cannabis businesses. That’s true whether you run a dispensary, wholesale cannabis business, harvesting business or any other type. The QuickBooks plan that you choose should be related to your business’s size and scope.
Why do I need QuickBooks?
When asking why do I need QuickBooks, it’s important to remember that every cannabis dispensary has different needs, so you may not need to use QuickBooks as your accounting software. Review the list above to determine the best accounting software for your business.