Latest / Unofficial QuickBooks Accountants Podcast / End of an Era
Transcript
- There may be errors in spelling, grammar, and accuracy in this machine-generated transcript. Hector Garcia: Welcome to the unofficial QuickBooks accountants podcast. I am joined by my good friend Alicia Cat Pollock, the original, the one and only Qbo Rockstar CEO and founder of Royal White Solutions. Alicia Katz Pollock: And I have the privilege of collaborating with Hector Garcia's CPA, the founder of Right Tool for QuickBooks. Hector Garcia: Today's episode is called The [00:00:30] End of an era. September 30th, 2024 marks the last day that new QuickBooks customers or new customers into QuickBooks could purchase a new license of QuickBooks Desktop Pro or QuickBooks Desktop Premier. Eventually, from October 1st forward, you could only purchase a new license of QuickBooks Desktop Enterprise or QuickBooks online only. [00:01:00] As a matter of fact, it's actually a new version of accounting software in the QuickBooks world called Intuit Enterprise Suite. And we spent a whole episode on that talking about that. But going back to what this means, this means that if you are already a subscriber to QuickBooks Pro, Desktop Pro or Premier, that means you already had a subscription prior to September 30th and you continue to pay your annual fees, you will be fine. [00:01:30] For now, you will still have QuickBooks Desktop Pro or Premier. It will be supported and new updates, security fixes, that sort of thing. You will still have access to that, but no new customers can get into QuickBooks Desktop Pro or Premier. Pretty much from this day forward, they will not be a growth to the QuickBooks desktop ecosystem. Maybe there'll be people getting [00:02:00] into QuickBooks Books desktop enterprise, but I don't think it would be faster than the folks getting into QuickBooks online or getting out of the old legacy QuickBooks Desktop Pro or Premier. Now, some people didn't get the annual subscription. They have old versions from prior to 2021 or 2022 that they still kind of use, and it's not an issue. Hector Garcia: Okay. That's fine. If, if if something happens where [00:02:30] there needs to be a major security update and windows updates and your QuickBooks is not compatible with with windows anymore, or windows requires a new security thing to happen into QuickBooks for that to work. Those folks would probably be out of luck, and only the folks that are in a current subscription that subscribed prior to October 1st are the only ones that will be able to use QuickBooks Desktop Pro or Premier. So that's what this means. And that's why [00:03:00] I start this with QuickBooks desktop. The end of an era. Now, what this means is that this is the start. This is why I'm calling it a pivotal moment in the history of QuickBooks. This is the start of the sort of slow death and slow killing of QuickBooks desktop. Now, let's be clear. There's probably still a million plus active users of QuickBooks desktop. They could be on an older version of Pro or Premier that's not supported anymore, [00:03:30] but still works. They could be on one of the annual subscriptions, as I mentioned, that got acquired around 2021, 2022, and they're still paying the annual subscription. Or they could be in QuickBooks Desktop Enterprise, which is very much still supported and is still being sold to brand new users in QuickBooks. So if you have a brand new person getting into QuickBooks, or maybe they're currently on QuickBooks Desktop Pro or maybe currently on QuickBooks online, they can in fact purchase a new license [00:04:00] of QuickBooks Desktop enterprise. Hector Garcia: Now for some context to get into QuickBooks Desktop Enterprise. The starting point is somewhere around 15 or $1600 for the one user edition, even with some of the discounts that are available, and pretty soon it will probably be a very minimum of $2,000 plus to just to get into this per year. By the way, to get into QuickBooks Desktop Enterprise. Now, the average QuickBooks enterprise customer [00:04:30] today is probably somewhere between a five user and a ten user, and they're paying closer to 5 to $7000 a year in their annual subscription. So QuickBooks desktop is no longer focused towards that small business. Even the QuickBooks Pro and Premier subscribers that are actively paying the annual subscription, their subscription pricing is going to $1,000 plus [00:05:00] per year. Some people are paying a couple thousand dollars a year for a multi-user license of QuickBooks Desktop Pro or Premier. So Intuit's focus for the small business is very much going to be QuickBooks online, period. So if a brand new business gets started, if a business is maybe on a different type of software or in a spreadsheet, and they want to move into an Intuit product for their accounting. Quickbooks [00:05:30] online will essentially be their their only choice, or the only choice that will be available to them. Hector Garcia: Now, QuickBooks Desktop Enterprise, as I mentioned, will still be sold. And for that larger echelon of the small business, some people call it the mid market, but mid market is actually a much larger group of businesses. Quickbooks enterprise is very much a great product. As a matter of fact, our firm still supports QuickBooks enterprise, still sells QuickBooks enterprise. We are resellers [00:06:00] and still supports QuickBooks enterprise users with training, technical issues, integration, implementation, etc. so QuickBooks enterprise is still very much alive. The last number I saw was about 250,000 active businesses on QuickBooks enterprise. And like I said, if I'm guessing that there's between 1 million to 1 million and a half QuickBooks desktop customers minus the 250 for enterprise, we're guessing that we're [00:06:30] somewhere around 750,000 to 1,000,001.25 million active users of non enterprise desktop QuickBooks. So I'm calling it the end of an era because as an accountant, as a consultant, as a reseller of QuickBooks, I can no longer sell, sell or get people into QuickBooks through QuickBooks desktop, especially for those smaller clients, smaller businesses. Which [00:07:00] means that now I have to look at QuickBooks in sort of two universes. I have to look at QuickBooks online for small businesses, and I have to look at QuickBooks enterprise for the larger echelon of small businesses. But also there's also a new wrench just thrown in the entire cog in the entire machine here, which is and we dedicated an episode not too long ago in the podcast to the new product called Intuit Enterprise Suite. Hector Garcia: Now, Intuit Enterprise Suite is basically based [00:07:30] on QuickBooks online. Using their platform, all the familiarity of how to use QuickBooks for QuickBooks online users will be simple when moving to Intuit Enterprise Suite, but this Intuit Enterprise Suite is aimed either for those people using QuickBooks online that are feeling they're outgrowing QuickBooks online, and keep them in the online platform and not move them into enterprise. So Intuit's focus will be not to move people [00:08:00] from QuickBooks online into enterprise and into Intuit Enterprise Suite. What they want to do is they want to parallel move anyone on QuickBooks Online Plus or Advanced straight into Intuit Enterprise Suite if they're outgrowing those versions of QuickBooks online. However, Intuit Enterprise Suite is not truly replacing QuickBooks Desktop enterprise. Quickbooks Desktop Enterprise is still king with construction [00:08:30] companies with special customized reports, especially for project based and job based businesses for inventory for manufacturing. It doesn't seem like in the direct near future into it will be supporting those with Intuit Enterprise Suite, with the exception of construction, because with some of the reports that were added recently to QuickBooks online advanced and into an enterprise suite, it does seem like they're going to be closer to serving that [00:09:00] construction project based business. I'm not sure if today, the day I'm recording this. Hector Garcia: It's good to go. I still kind of trust QuickBooks enterprise more for those type of clients, and especially for inventory based and manufacturing type clients, but we're yet to see. Now, another interesting piece of quasi news is that today, September 30th, we have not seen QuickBooks desktop 2025 be released. [00:09:30] Traditionally, September is when QuickBooks releases their New Year version, which is usually the following year from that September date range. So today or at some point this month, they should have released QuickBooks desktop 2025. We have not seen a QuickBooks desktop 2025 version yet. Instead, what we saw was a release. So R9 so a mid-year release [00:10:00] where they're releasing new features and the new features are enough to feel like probably in the past couple of years, like a New Year version, but they're not releasing. Or at least I haven't seen 2025 as the title of the software. Now I could be wrong. Maybe at some point in October or November, January or, you know, December, January, whatever, they'll release a 2025 edition. But as of today, I don't [00:10:30] see that happening. So either they're delaying that that title, that annual release, or they're opting not to give it that title. And there will continue to add updates, keeping the same 2024 year, continue to add updates enough for it to feel like a whole new version, but not necessarily have to give it a new title. Hector Garcia: It actually doesn't matter that it's called 2024, 2025, or 2026. That was done in the past [00:11:00] to sell you a new version. It was more of a marketing thing because QuickBooks has the ability to release mid-year updates to their desktop product and release new features. As a matter of fact, in the last couple of years we've seen, especially with enterprise, a lot more mid-year features being released that weren't necessarily Intuit wasn't necessarily waiting for the New Year edition to come out. For example, just this July, they released enhancements into reports. So in QuickBooks [00:11:30] desktop, you can now print reports with gridlines. So when you go click on print, you can click on print with gridlines. And then whether you create a PDF or actually print the report, you now see those sort of row lines or horizontal lines. So you can read the report better. So you don't have to break out your ruler and go through the report to see what that looks like. I'll do a video. I'll post into YouTube at some point in the near future exactly on how these features work, so you get a more [00:12:00] sort of visual effect. But for now, I'm just going to list all these new features that we're seeing in QuickBooks desktop be sort of released and be released in the middle of the year. The other really cool thing that they released, and this is just coming out for the October edition of QuickBooks desktop. Hector Garcia: The R9 release is the ability to zoom inside reports, so you will now see on the top right of the screen a little button where you can go zoom out to 75% to 50%, or zoom in all the way up to 225%, [00:12:30] I think. You can zoom out to 75% and then zoom in to 225. I think that's the range 75 to 25. And that's cool because in the past, if you wanted to quote zoom, you would have to right click and change the font size. This way you can simply just make the report bigger or smaller without fundamentally changing the font size of the report. This was requested for many, many years. I love it! So these two new visuals into reports for QuickBooks desktop are very powerful. It's [00:13:00] available across all editions Pro, Premier, Enterprise Accounting Edition all the desktop features have that. So I love that. And that's, you know, obviously certainly worth discussing now for the R9 for the October release of QuickBooks enterprise, they released this really cool workflow to go from a sales order to a purchase order. Now, in the past, both in QuickBooks Desktop Premier and QuickBooks Desktop Enterprise, you were able to create [00:13:30] a sales order. And then from the sales order, sort of like a template, click a button and create a purchase order straight from there. That's not new, but one thing that had always sort of annoyed us about that is that there was no linking between the sales order and the purchase order, so you would have to add a note somewhere in the notes saying this purchase order was created from sales order 1 to 3. Hector Garcia: Now, when you create the purchase order from that sales order, it will contain a linking. So you'll be able to link back [00:14:00] to that sales order. While looking at the purchase order and vice versa, which is pretty amazing. You can, in fact, create multiple purchase orders from a single sales order because you could have items in that sales order that are linked or not linked, but that you're going to purchase or subcontract from different vendors. So that's really neat that you can either just have a 1 to 1 relationship or have a, you know, one sales order to many purchase order relationship. [00:14:30] So that's going to be game changing for those that tend to use both sales orders and purchase orders, whether or not you use inventory. Sales orders are mostly an inventory thing, but whether or not you use inventory that would be useful for construction. Unfortunately, in most construction businesses don't use sales orders, so it actually would be really cool if Intuit would take this concept one step ahead and be able to do the same thing from an estimate. So if you were to create a purchase order from an estimate, retain that linking [00:15:00] as well. Hector Garcia: That would be incredible, particularly for those construction and project based businesses. And there's also an accompanying report called a sales Order link to. Purchase order report that basically gives you that sales order and all the accompanying. Purchase orders right next to it. And the report is really cool. It shows you every single. Sales order, whether it's open or not. And then what Po is linked to that sales order. So it's. Actually super wonderful to see. And it's broken down, you know, at the item [00:15:30] level as well. Because you can link individual items from the sales order to the purchase order. So it's not. The whole transaction is potentially individual items inside that transaction. And then once that process is completed, when you do the linking and you open the sales order, every single line item in that sales order will have a little link that says linked, and you'll be able to click on that and it takes you to that purchase order that's linked to the sales order, even if there are multiple, um, uh, [00:16:00] purchase orders assigned to that sales order. The other thing that was released recently, this happened around July of 2024 for QuickBooks desktop, enterprise, Platinum, and Diamond clients. They released a inventory stock status by lot number. Let me tell you something. As a person that's been doing manufacturing, accounting and inventory accounting for years, when the when they added the lot number feature where you can track inventory by lot number. Hector Garcia: The they kind of [00:16:30] just forgot that a report would be useful. So finally we have a report that shows all of your items. And under each item, each lot number and how much you have in stock in each slot. Believe it or not, that never existed. Also, expiration dates are tied to lot numbers. So if you're using expiration dates in this report, the inventory stock status by lot number will also show you that expiration date. So that's great. We love that. I mean [00:17:00] it's it's fabulous. It's really really fabulous. We finally got something that we've been asking for for years and that was actually released again mid-year in July on the 2024 edition of QuickBooks Desktop Enterprise. In that same summer, around June of 2024, they also released the Inventory Turnover by Item Report. This is a really cool report. It's only the it's under the inventory section of the reports. And this um, gives you two [00:17:30] key elements. One is the inventory turnover ratio. And the other one is inventory turnover days. And the purpose of this report is to know how quickly your inventory moves. So if your inventory stays stagnant for a very long time, you obviously run the risk of having obsolete inventory. So in order to avoid obsolescence, you want to turn that inventory quickly so you don't get stuck with old inventory. Hector Garcia: And these are reports that use financial metrics to give you an idea, more or [00:18:00] less what your turnover ratio is. And again, the faster you move the inventory, the the better overall to avoid obsolescence. Now during the 2024 first release, this happened back in September October of 2023 when they released QuickBooks enterprise 2024. They added a new feature called Customer Prepayments on sales orders, where you can actually create a sales order, receive a payment against that sales order. [00:18:30] It uses this whole clearing account to put the money in a liability, not as a negative accounts receivable, which is amazing. And then when you turn that sales order into an invoice, it automatically gives you the workflow to attach that payment into the invoice, moving the prepayment from the customer from a liability into accounts receivable, and eventually reducing that open accounts receivable in that invoice. That was an amazing feature that was released. It was was requested [00:19:00] for years, but it was only released from the perspective of receiving prepayment against guess the sales order. So then in July of 2024, they expanded that. And they also allow you to receive prepayments in estimates so you can receive prepayments in both estimates and sales orders. Now with QuickBooks desktop 2024. With QuickBooks desktop 2024 R7 updated in June of 2024. So those two are great features. And again, I love [00:19:30] the fact that they released some of it sort of the minimum viable product. Hector Garcia: And then they with feedback, they expanded it and they added estimates as well. So these are things that again, it just gets you excited that there are new things added to QuickBooks desktop mid-year. You don't have to wait for the next year release. And even if Intuit doesn't come out with 2025 or 2026, eventually your [00:20:00] general expectation is for you to expect every couple of months maybe a couple times a year. New updates, new fixes and new releases with your QuickBooks enterprise subscription. And maybe, hopefully they'll add it to the current QuickBooks Pro or Premier customers. My take on this, and this is why I'm calling it the end of an era, is that I don't think that past critical updates or critical security related, uh, or [00:20:30] fixing issues, I don't think you're going to see a whole lot of new features coming in into pro or premier, particularly because there's no new revenue coming in, no new customers coming in. So they might not be the general expectation that customers are buying Pro or Premier to expect it to continuously get better or be upgraded or add more features. I believe that you're probably going to see all the new features contextually. You're going to see all new features only [00:21:00] be released in the enterprise edition of QuickBooks desktop. So that's why I'm calling it the end of an era or the start of the end of an era. Hector Garcia: Pro and premier will start, you know, dying slowly. People will start moving either to enterprise or to QuickBooks online, and maybe to this new Intuit Enterprise suite. We'll see. Um, my last notes here are that I have used QuickBooks for a very long time. As a matter of fact, I fell in [00:21:30] love with accounting. I fell in love with the profession through my relationship with QuickBooks desktop. I believe I have had a very fruitful and meaningful relationship with QuickBooks desktop in my career, and it hurts me a little bit to see this sort of slow death come into QuickBooks Pro or Premier. Some accountants, some pro advisors actually kind of want to see QuickBooks desktop go away. And I understand it because it's difficult [00:22:00] to support both. Like, I know many times our clients call us and ask us the QuickBooks desktop question or a QuickBooks online question, and it's too much to remember. It's too much to support. And we might get embarrassed because we don't have the answer. Or we might have to have an awkward conversation about us not supporting one of the two platforms or whatever. So I totally understand the folks that kind of want to see QuickBooks desktop go away, focus on moving forward, sort of a new Dawn. Just think about QuickBooks online [00:22:30] and what QuickBooks online can bring moving forward. But there's also a few of us that are actually feeling nostalgic and a little bit borderline depressed about what's happening, because we know QuickBooks desktop works very, very well. Hector Garcia: Still, it's more powerful than QuickBooks online in many ways, and I'll accept that QuickBooks online has tons of incredible merits and awesome features that in many ways makes collaboration and switching between clients much [00:23:00] better, much better experience for accounting professionals supporting clients. But those those of those of those of us that have been supporting QuickBooks desktop for a very long time, have been helping our clients build their relationship with their desktop software, be able to solve things that they didn't know they could solve. Trick out the software. You know, knowing that sort of the ins and outs of the software to fool the software into thinking that it can do something it probably wasn't designed to do. That's been a very satisfactory journey [00:23:30] for a lot of us. So I want to say that I feel you, I understand you, and I share your pain on this slow potential death of QuickBooks desktop that we're going to be seeing in the next couple of years. And my heart is with you, and I will be supporting you along the way with my YouTube channel, with with this podcast, with content and kind of help you guide, guide, help you, guide you through it as I guide myself through these changes. [00:24:00] Anyway, I hope you enjoyed the podcast and I'll see you in the next one.