Ask Slashdot: How To Run a Small Business With Open Source Software?

First time accepted submitter ahree writes "I'm starting up a restaurant with my wife and a few friends and, well, I'd like to support the OS community and hope that this is a way to do it. Simply put, we need to take care of bookkeeping, accounting & payroll and I'd rather not use QuickBooks. I've heard of some options that are open source (GnuCash), some that are cheaper & simpler (WaveAccounting), but I'm wondering what your experience with them (and others) has been like."

Comments

lots of options

[Trepidity]

I would say most small businesses I know actually don't use any specific financial software, but do everything in a spreadsheet package. Excel rules the small-business world in a lot more ways than you might expect. You can probably do most similar things in LibreOffice. Now whether this is a good idea varies. The con is that you can end up with a sprawling spreadsheet-and-macros mess, but the pro is some flexibility in doing complex things, and simplicity in doing easy things.

GnuCash is not a bad option either, but it works best if your processes map on cleanly to one of its default processes. It does standard double-entry bookkeeping just fine. Its documentation is pretty good, also. But if you want to be doing significant scripting or customized report-generation, I find spreadsheets easier than dealing with GnuCash scripting+reports.

Depends on what kind of business to some extent. For example, if you need to interface with shopping-cart software or something of that sort, you may have more specific requirements.

Re:lots of options

[cayenne8]

I love open source software, and try to use it myself whenever possible...where it fits and is the best tool for the job.

However, on business financials....do NOT skimp on this. You need to track costs, billing, etc.....this is especially true at EOY when having to deal with your CPA, and the IRS. It is tough enough to have to deal with the myriad of laws and regulations the state and feds put on small businesses, go with something that is set up to help you out and accurately track finances, payroll, etc.

I'd recommend going with Quickbooks. It is almost a 'standard'...which makes it easily portable between you and your CPA.

Don't cheap out....get a good CPA to help keep you honest on your taxes....a good one will help you squeeze out every penny to keep for yourself legally, while being conservative enough to keep you off the IRS' radar.

This is business...and $200-$300 invested on this....will help you out in the long run...and hey, you can write the QB purchase off on your taxes.

My first thought

[Cute Fuzzy Bunny]

My first thought is that opening a restaurant is one of the hardest things in the world to do. If going open source helps lighten your load or costs in a significant manner and makes the restaurant launch more likely to succeed, then swell.

If however its going to be a case where you cant get support, stuff doesn't work, and nobody is available to help bail you out when fixing your software isn't in the top 50 on your priority list...

Re:My first thought

[Shoten]

My first thought is that opening a restaurant is one of the hardest things in the world to do. If going open source helps lighten your load or costs in a significant manner and makes the restaurant launch more likely to succeed, then swell.

If however its going to be a case where you cant get support, stuff doesn't work, and nobody is available to help bail you out when fixing your software isn't in the top 50 on your priority list...

This is excellent advice, and I would add a bit more to it. Are you looking at Open Source because you're a Linux guru who is used to managing such types of systems, or because you want to save the money that you'd otherwise spend on QuickBooks and Windows licenses? If it's the first, then also consider how much time you'll have to be the sysadmin on top of your other non-IT duties there. If it's the second, then forget OSS. You'll save less than a thousand dollars, in exchange for which you'll have another learning curve thrown at you while trying to open your first restaurant. Restaurants have, as I recall, an 80-90% failure rate in the first year; don't give yourself more to have to deal with to save a tiny bit of money. Your IT infrastructure won't be large, but it MUST be functional and reliable.

Re:My first thought

[mysidia]

Priority and IT time should be getting a good, stable, efficient, reliable POS system in place, that has the reporting req'd for the business to function, with good vendor-supported integrations into the accounting system, and fair due dilligence there.

As for accounting.... use what the Accountants are comfortable with; don't try to shoehorn your organization into an open source solution, if it's not appropriate, when the good open source solutions are hard to find or have poor online integrations or restaurant/ line-of-business-specific addons/plugins due to proprietary QB-specific services, banking protocols, and document formats.

An accounting package might not even be the cost-effective answer there; the answer may even be BPaaS, outsourced Accounting as a Service, or a SaaS accounting application.

The main thing is ensuring the management can focus on making the restaurant successful and profitable; they need reports and accounting for decision making and to do that effectively, but otherwise, accounting is a royal pain.

Re:My first thought

[Bert64]

There are people out there who will know the open source software inside out too, and to a much greater level given availability of the sourcecode, whereas only the original vendor will ever have that level of knowledge about a closed source package.

What you do highlight, is that its important not to get your business dependent on something that can be taken away from you... However you're approaching it from the wrong angle... Any proprietary software is dependent on its vendor, who may stop updating it, may discontinue the product, may decide they dont like you or are part of a larger company which competes against you, may go bankrupt or any number of other risks.
With an open source package, you have 2 very important advantages:

1, the source is available, so absolute worst case you can hire someone to work on it for you, as opposed to being stuck at a dead end.
2, the data will be stored in a format for which documentation is available, wether the format is properly documented or the only documentation is the source itself obviously matters, but either situation is better than a proprietary system where no documentation is available to you at all and you are forced to reverse engineer the binaries.

Always have an exit strategy, plan for what you will do if the worst happens to any one of your suppliers. In the restaurant trade that will be everything from "buy our rice from any one of the other 50 suppliers" to "migrate all our accounting data to a whole new package"...

Think Ahead

[clinko]

Advice on Restaurant Ownership... It's going to be tough, long, and either the wife or friends won't be a wife or friend by the end.

Consider the future, you or someone will bow out. Accountants and/or Lawyers will be involved and they don't know GnuAnything. They know QuickBooks.

You may sell your restaurant as a group, the buyer will likely want to see the accounts in QuickBooks.

You may be successful! congrats! you can now hire an accountant, they'll want QuickBooks.

In short, pool the wife & friend's money, pay the minor entry-fee for QuickBooks and save yourself the time (which you'll need the most now).

Good luck!

SQL Ledger

[colenski]

http://www.sql-ledger.com/ ugly as sin but it does *everything* and it's reliable. Good community support.

Re:SQL Ledger

[6031769]

Or try the less cathedral-like approach of LedgerSMB which was forked from SQL-Ledger a few years ago. We moved then and haven't looked back.

Risky Investments

[Anonymous Coward]

"I'm starting up a restaurant with my wife and a few friends

I don't know if it's wise to risk your investment in your restaurant for the sake of supporting the OS community. When I recommend software, open source or otherwise, I always suggest the very best software available to do the task at hand. It sounds like you are looking for a shortcut and that never pays off.

Here are the steps you should be following:

1) Find best software
2) Is it open source? Then support the product. If not, then buy a license.
3) PROFIT$

Priorities

[dokebi]

First of all, I've been using GnuCash for my personal finances for 10 years now, and I'm very happy with it. It taught me double entry book keeping, and basic accounting concepts that I found useful in other situations.

Having said that, I would not recommend GnuCash for your business because:
1. You will need to share your data with your accountant, and they understand QuickBooks or PeachTree only.
2. GnuCash's business functions (invoicing, inventory, paychecks for your employees, loans, etc) are woefully inadequate.
3. GnuCash's reporting functions are inadequate.

I would say go with PeachTree, and support open source software in some other way (say donating some of your profits).

Good luck

Alternatives

[LordThyGod]

I've been involved in the bookkeeping end of several small businesses. My suggestions .... as to payroll, do not do this in house. Its a PITA, and you will wind up either making mistakes you will come to regret, or spend more time on it that you might be able to use more wisely somewhere else. Keeping up with local tax districts, who lives where, when the govt(s) (assuming you are US) decide to make some subtle change to tax regulations. Penny wise, pound foolish to do this in house for most small businesses. As to basic accounting and booking, I am not aware of anything that does the sheer number of things that QuickBooks can do, or as well. But I haven't tried everything. This sounds to me like the kind of thing that is hard for free / open source projects to compete with. Maybe your needs are very simple? I would suggest some of the SaS products like FreshBooks. These may not meet your critieria of open source projects per se, but many of these have open API's which is a step in the right direction. Also, these are likely built with open source projects, eg Apache, Ruby, PHP, MySQL, Python and so on, so there is some second hand support of open source that way. They also free you from the local installation situation, and can be accessed via mobile or remote locations (ie work from home), with zero hassle. I have used FreshBooks for accts receivable situations, and found it very nice. Compared to QuickBooks, I would opt for FreshBooks for billing and invoicing easily. I have not looked at with acct payables or general ledger in mind though.

Remember the Actual Costs

[wrfelts]

You've got to remember that using FOSS software doesn't mean that you aren't going to have an expense for this. One of the downsides of FOSS is that it is generally software that "scratches the itch" of those willing to develop code for it. It doesn't mean that the software is lower quality, just that they may not have covered everything you need. Also, it may not be the easiest thing to install. If you aren't a Linux geek, or you now don't have time to be since you are running a restaurant, make sure you have some competent local support lined up. Proper install, setup, and security is important and can't just be swept under the rug.

Also, another somewhat obvious suggestion is to make sure you can line up an accountant that is familiar (or willing to become so) with the software you choose for the books. If you find one that actually uses some FOSS, they would have better advice on what packages to use, since they are more familiar with the accounting/regulations side of things.

Be aware that regional corporate and finance laws may be different than those of the software developers'. Commercial software has a general business requirement to keep up with those and supply the necessary patches. In absence of the commercial incentive to "not get sued over missing a patch" you will need to make sure that you have that covered. A few dollars of support to a local programmer (in conjunction with the aforementioned accountant to keep things moving in the right direction) will keep you out of the legal ditches as well as ACTUALLY support FOSS software.

In general, there is a price to pay for freedom. There always has been. If you want software that isn't locked up by greedy or laconic software corporations, you can't be greedy either. You still need to pay for the expertise to keep things on track and actually support the free environment that you wish to take advantage of. Costs are still there. They just shift. If you go in with open eyes, it won't shock you. It's still worth the investment. It just takes a slightly thicker skin to (hopefully) get a slightly cheaper and more customized outcome.

Re:Pay for it

[icebraining]

I may be biased, but I have to agree.

I work for a FOSS based software company; we charge for installation, support, training and custom development of a GPL licensed ERP solution.

Our clients get a much cheaper solution and we contribute back to the platform (bug fixes, new FOSS modules, etc).

I won't plug my company, and the restaurant is probably not based on our country anyway, but I'd consider this approach.