Originally published June 16 2005
Do-it-yourself tax software grows in popularity
by Mike Adams, the Health Ranger, NaturalNews Editor
From Intuit's TurboTax and SnapTax to the new Quickbooks, do-it-yourself tax software is slowly gaining popularity and companies' steadily growing revenues prove it.
As Americans debate whether it's less painful to visit the dentist than pay taxes and the IRS estimates that the total number of tax filers grew less than 1% in 2004, Intuit (Nasdaq: INTU) forecasts that revenues from TurboTax and SnapTax will grow a modest 5%-10% in fiscal 2005 -- much less than the robust 16% growth of the prior two years.
With a high churn rate, a crowded marketplace, substitutes like the office accountant pal who does your return for free, and community-organized free-filing tax sessions, this is a tough market to be in, and 5%-10% growth is nothing to be ashamed of.
As a consulting accountant, I've noticed Quickbooks being used as an accounting program alongside the user's industry-specific business software.
For example, several of our hotel and motel franchisee clients use a standard hotel industry package for the business side -- reservations, credit cards, front desk operations, and the like.
They generally find Quickbooks easier to use than their industry package, it offers a more comprehensive accounting solution -- taking care of expenses, payroll, financial reporting, etc. -- and it is relatively cheap as an add-on.
While Quickbooks contributed $222 million, or 33%, of second-quarter fiscal 2005 revenue, it should bring in closer to 26%-27% of revenues for full fiscal 2005 after adjusting for third-quarter revenues, which are skewed toward TurboTax sales during tax season.
The Quickbooks stable has three versions -- Basic, Pro, and Simple Start.
There are also premier versions for the manufacturing, contracting, and not-for-profit sectors, plus complimentary products and services such as payroll and credit card processing.
Second, direct sales increased a whopping 61% in that quarter.
While direct sales are still a very minor contributor to revenues, they add crucial pennies to margins when revenue growth is tapering off.
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