Small Business Advice

What Software Do Small Businesses Use?

Today, small businesses have to use software to stay competitive. The eight most important types of software for small businesses are described below, along with our recommendations for the best individual software solutions.

If you're running a small business, you know that software is a key ingredient for success. The right solution will save your team considerable time, streamline your operations, and help your business grow.

However, it's not easy to identify the most important types of software to invest in, or the best solutions.

It turns out that there are a few types of software that are used by almost all small businesses – accounting software, document management software, and HR software.

Beyond these must-have software tools, small businesses frequently use the following types of software:

  • Collaboration software
  • Electronic signature software
  • Marketing software
  • Project management software
  • Website builder software

Below, we explain what each of these software types is used for, along with our top recommendations of individual solutions for small businesses.

The analysts at SoftwarePundit have spent months researching each category, and hand-testing each of the solutions that we recommend. To learn more about how we research and rate software tools, read about SoftwarePundit’s review methodology.

Table of Contents

Must Have SMB Software: Accounting, Document Management & HR Software

There are three types of must-have software for small businesses – accounting software, document management software, and HR software. Almost all small businesses use these systems to manage foundational functions.

Accounting Software

Accounting software is one of the most widely used among small businesses. For less than $100 per month, it's possible to get a system that automates the collection and organization of financial data, generates insightful reports, and streamlines tax preparation.

Accounting software typically comes with several of the following features:

  • Accounting Reports
  • Invoicing
  • Expense Tracking
  • Inventory Management
  • Payment Processing
  • Customer CRM
  • Vendor CRM
  • Payroll
  • Tax Form Generation
  • Time Tracking
  • Receipt Capture

If you're interested, you can learn more about why you need accounting software to manage your business.

Most Popular Accounting Software: QuickBooks Online

Best Solution for Business Owners: Xero

Most User-Friendly Accounting Software: Wave

Document Management Software

Document management software is another core system that's almost universally used. If you want to create and store digital files, or send business emails, you'll need one of these. The two most popular systems are Google Workspace and Microsoft 365.

These systems have many functions including document creation, document sharing, document storage, and team collaboration. Google Workspace also includes Gmail, Google Meet, Google Groups and Google My Business.

Our Top Choice: Google Workspace

Best for Microsoft Office Enthusiasts: Microsoft 365

HR Software

HR software is critical for managing any business. While HR software has several functions, payroll processing and compliance are the two most necessary. All businesses need to pay their employees and maintain compliance with state and federal government policies.

HR software typically comes with several of the following features:

  • Recruiting
  • Onboarding and offboarding
  • Payroll
  • Time tracking
  • Compliance support
  • Benefits
  • Performance management
  • Expense management
  • Analytics and reporting

Best All-Around Solution for SMBs: BambooHR

Best HR Software for Payroll: Gusto

Nice to Have SMB Software: Collaboration, Electronic Signature, Marketing, Project Management & Website Builder Software

There are dozens of types of software used by small businesses. However, there are a handful of categories that are more popular than the rest, and more valuable.

These are the nice-to-have software tools: collaboration software, electronic signature software, marketing software, project management software, and website builder software.

Collaboration Software

Collaboration software is used to facilitate team communication. There are different types of collaboration software including team chat, video conferencing, and email clients.

If you decide to use Google Workspace as your document management system, you'll be happy to learn that it comes with a chat application as well as video conferencing. In contrast, Microsoft 365 comes with Microsoft Teams, which competes with Slack.

Best Internal Communication Software: Slack

Electronic Signature Software

Electronic signature software is used to create, execute and store legal documents. While many businesses still use pen and paper to manage physical documents, it's not recommended.

PandaDoc has one of the best free software plans in the world. Its free plan allows you to upload and send an unlimited number of documents.

Most Powerful Solution: DocuSign

Best Free Plan: PandaDoc

Best Value: signNow

Marketing Software

There are thousands of marketing software tools for small businesses. These systems help small businesses engage potential and existing customers across all marketing channels.

When selecting marketing software for your business, the first thing you should determine is the marketing channel you want to invest in. Email marketing is an extremely valuable channel that most small businesses begin with. After that, you might decide to invest in search, social media, live chat, or SMS marketing.

Best Email System for SMBs: Mailchimp

Best Customer Engagement Platform: Podium

Best Online Search Software: Semrush

Best Social Media Management Software: Sprout Social

Best SMS Software: SlickText

Best All-round CRM Software: HubSpot

Project Management Software

Companies with more than five employees benefit from project management software. These tools help you keep track of the different projects and tasks happening at your business.

When evaluating them, it's important to decide how complex of a project management system you need. Smaller companies with more basic needs are a perfect fit for a simple, cheap solution like Trello. Larger companies managing complex projects are better off with a solution like Asana.

Best Overall: Asana

Best for Technical Teams: Jira

Best for Small Teams: Trello

Website Builder Software

Small businesses use website builder software to create and publish websites. These systems require very little technical ability, and come with beautifully designed website templates.

Website builders typically come with the following features:

  • Website page builders
  • WYSIWYG blog editors
  • Ecommerce tools
  • Plugins, applications, and extensions
  • Online search & SEO tools
  • Analytics dashboards & reports
  • Social media marketing tools
  • Email marketing tools
  • Contact forms

Best Overall: Wix

Best Designs: Squarespace

Easiest to Use: Weebly

Industry Specific Software

All of the solutions listed above are horizontal software tools that work for businesses in any industry. There are also industry-specific software tools built for companies in a given industry.

Here's a list of industry specific software:

If you manage a business in one of the industries above, you're likely better off finding the right industry-specific software rather than purchasing a number of general software solutions. Industry-specific software is typically the foundational software tool that supports the most critical business functions.

A few examples of outstanding industry-specific software is listed below.

Course Creation: Thinkific

Thinkific is a best-in-class course creation platform that you can use to create and sell online courses.

Dental: CareStack

CareStack is our top rated dental practice management systems. It is cloud-based and comprehensive – customers of CareStack might not need to purchase patient engagement software.

Field Service Management: ServiceTitan

ServiceTitan is our top rated field service management system used by professionals in numerous industries including plumbing, HVAC, pest control, lawn care, and more.

Fitness: Glofox

Glofox is our top rated fitness management system that is used to operate gyms, studios, and salons.

Legal: Clio

Clio is the most popular practice management system for law firms.

Mental Health: SimplePractice

SimplePractice is our top rated practice management system for health and wellness clinicians.

Property Management: Buildium

Buildium is a leading property management system that residential property owners use to manage the rental of their homes.

Vacation Rental Management: Guesty

Guesty is our top rated vacation rental management system used by property owners to manage rental properties.

Final Thoughts

Figuring out the best mix of software tools to implement for your business is challenging. However, there's really only a handful of software types that most businesses use.

To get started, we recommend implementing an accounting solution, document management solution, and an HR solution. For a small business, these systems will almost certainly cost less than $150 per month in total.

After getting those must-have solutions in place, start researching the other common software types. There's no rush to implement several tools at once – it's better to pick one or two new software types, become an expert, and test your favorite solution. Over time, you'll become highly knowledgeable about software, and build your company's technology stack.

Finally, don't forget to research the industry-specific software that is a fit for your business. Typically, this all-in-one software can support several of your key functions, and save you money.

Bruce Hogan

Bruce Hogan is Co-founder & CEO of SoftwarePundit. He leads the team's research and publishes content about software products and trends. Bruce has experience investing at multi-billion dollar private equity firms, leading teams at venture-backed technology companies, and launching new businesses. You can connect with Bruce on LinkedIn.

Bruce is an expert in several software categories including:

  • Dental software
  • Mental health software
  • SEO software
  • Social media software

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