Microsoft accounts for small businesses

Microsoft Thursday made available a new version of its small business accounting software, which it is aiming at customers who don’t require the heft of more extensive business software products that it sells.

Small Business Manager 7.0 is an upgrade to a product first released in November last year. The new release adds features that allow customers to manage inventory and purchase orders, in addition to the existing general ledger features in the previous product, said Karen Engel, lead product manager with Microsoft’s Business Solutions division.

Microsoft Business Solutions offers a range of software and services including products it gained through the acquisitions of Great Plains Software and Navision A/S. Small Business Manager 7.0 uses the same base technology as Microsoft’s Great Plains financial software, but has a different “fit and finish,” Engels said.

Another feature Microsoft is highlighting in the new release is its integration with Microsoft Office, which allows tasks managed using Small Business Manager to be completed in Word and Excel. Customers can also link the software to Microsoft’s online accounting service bCentral.

A software development kit will be available to third-party accounting software makers so they can integrate their software as well, Engels said.

Some Microsoft partners say the software hits a sweet spot for customers who require an entry-level accounting package that leaves them room to upgrade as their businesses grows.

Payson Peterson, senior manager with Skotty Consulting Group in Colorado Spring, Colorado, has helped move two customers on to Microsoft’s new small business software. Peterson said that Small Business Manager 7.0 puts Microsoft in a good position to reach small businesses before they are big enough to need its more expansive Great Plains software.

“It’s very complementary” to Great Plains, he said. “We have several prospects and customers that are start-ups that just aren’t at that size right now to use Great Plains, but they want to get on a Microsoft product.

“Being able to upgrade is actually a great feature,” Peterson said.

Microsoft contends that its competitors are not adequately targeting small businesses. Products such as QuickBooks from Intuit, and those from Peachtree Software, don’t offer some of the more advanced accounting features such as payroll and don’t give businesses room to grow, Engels said.

Meanwhile, higher-end products available through its Business Solutions Division and others such as SAP AG, are too complex for many customers, she said.

Wayne Viener, CEO of Groupfive, an accounting software integrator based in Rockville, Md., and Microsoft partner, agreed that many customers in the middle market go underserved.

“There are a lot of companies that are bigger than Peachtree but they’re not going to spend $30,000 or $40,000 on the next level,” Viener said. “This gives them some place to go.”

Small Business Manager 7.0 is available immediately through Microsoft partners and integrators. Prices range depending on the number of users and features purchased. The basic suite for a single user costs $995, and $2,495 for up to five concurrent users. An upgrade and support package, called the Foundation Services Plan, is priced at $275 per year, and is required for the first year.

An add-on module for managing payroll is available for an additional $500. Existing Small Business Manager customers can upgrade to the new release at no cost.