Accounting software is the application used by businesses to keep track of the financial flow within and outside the organization. Unlike before, these technological advancements provide modern methods to streamline workflow through interoperability within different departments.
In addition to maintaining basic accounting records, these applications assist with customer relationships, human resource management, supply chain management, and so on.
From large-scale ventures to small-scale industries, the demand for accounting software has become more evident nowadays. The global need for such innovations is visible in the surge of the Accounting Software Market at 9.10% CAGR, exhibiting a lucrative growth option for businesses in the industry.
Why is Accounting Software Market Emerging As a Versatile Solution?
Various factors can be attributed to the growth in the demand for accounting software and its market:
Accounting software is a reliable option for businesses to keep track of the ins and outs of the money flow. On top of managing the accounts, it can also assist with the maintenance of account payables, receivables, business payroll, ledger, and other modules.
With features like automatic updates and reporting, accounting software enables even small-scale ventures to maximize the operational utility of applications. In addition to accurate financials, these characteristics allow higher productivity and effective functionality by streamlining complex accounting easily.
To augment the flow of operations and ensure error-free accounting, the software is becoming a boon for businesses with less workforce. It leads to efficient utilization of capital and higher optimization of the company’s resources for smoother management.
Global Accounting Software Market by Component, Deployment, Industry, Organization, and Region
The expected growth of the accounting software market to USD 70.2 billion by 2030 is a marker of the ever-increasing requirements of such applications.
“Conventional accounting software lacked technological competitiveness, which creates an environment for expansion and upgradation of the accounting software market.”
Fortune Business Insights corroborated the rise in the demand and growth of the accounting software market with its inventiveness and flexibility to scale.
The need for mobile-based applications and innovation in the AI segment further pushes the demand and growth trajectory of accounting software upwards across industries.
Here’s an analysis of various domains witnessing the growth of the accounting software market:
Based on the component, the accounting software market is categorized into services and solutions:
- The solutions segment acquired the largest market share in 2021 by offering businesses easier facilitation of operations and management.
- The services sector, contrastingly, is now expected to grow with a 20.9% CAGR in the coming years due to benefits like easy tax filing, cash flow reporting, enhanced software implementation, and minimized deployment risks.
By deployment model, the market of accounting software is bifurcated into On-premise and Cloud segments.
- On-premise software allows accessibility of financial databases with higher stability, which formed the basis for the acquisition of the highest revenue share in 2021.
- The cloud segment is anticipated to witness the highest CAGR of 1% by 2030 due to the integration of data security and low-cost application with hassle-free maintenance.
By Vertical or Industry Outlook
Depending on the end-use industry, the global market of accounting software comprises:
- Banking Financial Services and Insurance (BFSI)
- Government and Public sector
- IT and Telecommunications
- Retail & E-Commerce
- Media & Entertainment
- Energy & Utilities
- And Others
Due to the rapid rise in the demand for healthcare across the globe, the healthcare sector has seen a major increase in the usage of accounting software. The mushrooming of novel illnesses and disruption in the medical field further projects the requirement for accounting software and growth in the market share.
Out of Commercial, Enterprise, Custom, and Spreadsheets, the Commercial type has captured the highest revenue market share in 2021. Software like TurboCash, QuickBooks, etc., offer businesses personalized solutions to summarize and organize data.
However, according to the latest market trends, enterprise software is paving the way for future growth of accounting applications through interoperable solutions across departments.
North America, comprising the United States, Canada, and Mexico, has dominated the accounting software industry in 2020 and is expected to lead the way in the future as well. The major reasons behind the encompassing presence of the region in the accounting software map are:
- Understanding of financial application analysis
- Significant investment by top players across private and public sectors
Key Players in the Accounting Software Market!
The presence of advanced and robust IT software presents businesses with numerous opportunities to cut down operational costs while skyrocketing their efficiency.
The leading companies in the accounting software market understand the importance of innovation and the inclusion of multiple features to enhance the usability and functionality of these applications.
The dominating organizations in the accounting software market are:
- Oracle Corporation
- SAP SE
- IBM Corporation
- Zoho Corporation
- Workday Inc.
- Sage Group
- Kingdee International Software Group
One of the major strategies to enhance cross-platform functioning are partnerships. For instance, FRESHBOOKS’ collaboration with ChargeZoom integrated the features of bill generation and invoice delivery for higher efficiency.
Modern times rely on innovation and experimentation to deliver the highest efficiency and productivity irrespective of the industry and market size.
With the growth of businesses across the world, the need for automating accounting data and processes is increasing as well. This trend is evident in the 72% adoption rate of such applications across industries as compared to the previous years.
The future of accounting software depends on the flexibility of accommodation of different client-centric features to enhance harmonization and reduce overall operational costs. With the incorporation of cloud-based solutions, AI, and automation, the projected growth of the accounting software market is set to soar even higher.