Leveraging the Long Tail – Shoeboxed

ShoeboxedOverview

Shoeboxed is a service and application that leverages the long tail to target a niche section of a broad market. Shoeboxed targets personal and business customers that are looking for a tool to simplify their expense data entry without the need for a dedicated data entry person and at a cheaper cost than paying an accountant to do it all. It offers tools to export into many common accounting programs and formats used in many others. Shoeboxed leverages the long tail by targeting a niche that overlaps the accounting and data entry markets. Shoeboxed allows customers to mail or email receipts and invoices to them where it is then scanned and converted into a format that can be easily viewed online as well as exported into a form that can easily be imported into your accounting software. I found this software on the first page of a Google search for the long tail search phrase “software to automatically import your receipts into your accounts“. How can you shorten a phrase such as that into something simple? You can only get it so short because it is not a niche that has a specific name at this time. The closest I can think of is expense management, but that doesn’t really describe what I was looking for at all.

Comparison

Leveraging the Long Tail - Shoeboxed
Screenshot from: https://www.shoeboxed.com.au/receipts-for-taxes/

After further digging through the search results for my query, I came across a few other possibilities on subsequent pages, including: Expensify and Receipt Bank, none of these stood out in the results as much as Shoeboxed though. Each offers similar features, however, Shoeboxed is the only one that is targeted to Australia and provides scanning services that are indicated as being accepted by the Australian Taxation Office (n.d.). Similarly, Expensify is USA oriented and claims that their receipt scans are accepted by the IRS (n.d.) and Receipt Bank is UK based where they claim their receipt scans are accepted by the HMRC (2011). These 3 services all leverage the long tail, targeting customers in a niche need of the accounting and book keeping markets and targeted to the requirements of their designated countries (Australia, USA and UK).

All 3 services offer solutions targeted to both individuals and companies with plans ranging from few expenses to many, however, Expensify is a little bit different as they only charge customers for company expense reports that are submitted to their supervisors for approval, this means that for personal users, it’s free (n.d.). Comparatively, the “Lite” plan on Shoeboxed is AUD $19.95 per month (n.d.) and the basic “Digital” plan on Receipt Bank is UK £6.99 per month, neither of these have a free option beyond their free trials.

At the time of writing this, these companies offer the following services:

Shoeboxed Expensify Receipt Bank
Physical Receipt Scanning Yes No Yes
Digital Receipt Scanning Yes Yes Yes
Business Card Scanning Yes No Yes
Unlimited Scanning Yes (charged a fee beyond monthly limits) Yes (credits based) Yes (fair usage policy applies)
Human Verification Yes No Yes
Address Book Yes No Yes
Free Postage Yes (except on Lite plan) No (post options not available) Yes (except on basic Digital plan)
Receipt Hard Copies Returned Yes (except on Lite plan) No No
Free backup CD Yes No No
iPhone Application Yes Yes Coming Soon
Mobile Application Yes Yes No
Credit Card Statement Matching No Yes No
Expense Reports Yes Yes No
Supports Add-Ons No No Yes
Export to CSV Yes Yes Yes
Integrate with MYOB Yes No No
Integrate with Quickbooks Yes Yes No
Integrate with Freshbooks No Yes Yes

Implications

Shoeboxed presents some fantastic implications for small businesses, sole traders and even individuals. Primarily, time savings. As a sole trader or small business operator, management of expenses is vital and data entry can be tedious and time consuming. Shoeboxed helps to make management easier, reduce the time involved and allow you to easily export the data into your accounts management software using either one of the available integration tools, or the standard CSV format that can be imported into the majority of accounting tools. As an individual this isn’t as important as there are often less tax related expenses to keep track of, however, even then this tool can make organisation come tax time much simpler. For larger companies it is more affordable to manage these things in house with dedicated accountants, so the advantages of Shoeboxed are less, but a tool such as this could allow a larger company to operate without in house accountants for longer, saving them money as they grow, and potentially staving off the need for an in house accountant for substantially longer.

While it may mean receipts and invoices are less likely to be lost or forgotten about, there is the possibility of mailed in receipts getting lost or there being mistakes in data entry, despite care being taken. Mail does unfortunately get lost sometimes, this could be extremely bad if they are the only hard copies of receipts and they are lost. This could be mitigated if customers take copies of the receipts before sending them in, but this does effectively equate to managing scanning themselves and the customer might as well just email them in, thus retaining hard copies. It would though mean more work for the user which lowers the time saving advantage of Shoeboxed. Mistakes can occur with data entry, despite the optical character recognition being human verified, it is still possible which could result in discrepancies when expenses are balanced against bank or credit card statements. This is no different though to mistakes that can occur in house and due to the use of OCR and human verification, it is potentially less likely for mistakes to occur, or to be missed, than if it was managed in house. This means a potential pitfall of Shoeboxed system could also be a potential advantage depending on how carefully scanned and inputted data is verified.

Potential Legal and Ethical Issues

The largest potential issue, both legally and ethically is data usage and ownership. Providing Shoeboxed with all of your expense records gives them as a company, and individuals working for them access to a potentially enormous amount of personal data, opening them up to a realm of privacy issues. The security and integrity of this data is vital for the privacy and safety of users.

According to the Shoeboxed security information page, a number of measures are in place to protect their users and ensure data security and integrity. This includes on the technical side, the use of SSL encryption when accessing data online, TRUSTe privacy certification, remote backups and secure networks. On the physical side, buildings are secured with digital locks and double locks, and 24/7 security is on site. In terms of personnel, employees must pass background checks and only authorised personnel are allowed to retrieve mailed in receipts that are sent to the PO Box and are required to transport them directly to the processing facility.

Security is vital for both legal and ethical reasons, and their website indicates just how serious they have taken it.

Future Directions

A key future direction that I can see for Shoeboxed is the automated integration with accounting platforms such as Saasu. This kind of live integration, combined with live bank feeds that are already available in some accounting systems would substantially reduce the need for user input to combine these data sources and thus improve efficiency and reduce costs even more than is already done.

It could be argued that Shoeboxed should match up expenses with credit card statements like Expensify does, or go as far as matching up with live bank feeds directly, but to me this seems like a waste of time considering that these feeds are already in use in some accounting systems, it seems a better direction to focus more on accounting integration.

The other potential direction is towards add-ons or extensions. Receipt Bank uses add-ons to integrate with book-keeping and invoicing software. Rather than developing integration tools themselves, Shoeboxed could develop an API to allow third parties to develop their own integrations. There is though the risk of misuse of data in doing this so it would need to be considered carefully and ensure that the API and approved add-ons meet the security standards of Shoeboxed.

References

Expense Cloud. (n.d.). Expense Cloud. Retrieved May 19, 2011 from https://www.expensecloud.com

Expensify. (n.d.). Expensify. Retrieved May 19, 2011 from https://www.expensify.com/

Google. (n.d.). Software to automatically import your receipts into your accounts – Google search. Retrieved May 19, 2011 from http://www.google.com/search?q=software+to+automatically+import+your+receipts+into+your+accounts&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-US:official&client=firefox-a

Receipt Bank. (n.d.). Pricing plans for individuals. Retrieved May 19, 2011 from https://www.receipt-bank.com/the_plans/individual

Receipt Bank. (n.d.). Receipt Bank. Retrieved May 19, 2011 from https://www.receipt-bank.com/

Receipt Bank. (2011). Will you send my receipts back to me after you’ve scanned and processed them? Retrieved May 19, 2011 from http://getsatisfaction.com/receipt_bank/topics/will_you_send_my_receipts_back_to_me_after_you_ve_scanned_and_processed_them

Shoeboxed. (n.d.). Easy BAS and tax return prep for receipts and documents. Retrieved May 19, 2011 from https://www.shoeboxed.com.au/receipts-for-taxes/

Shoeboxed. (n.d.). Pricing. Retrieved May 19, 2011 from https://www.shoeboxed.com.au/pricing/

Shoeboxed. (n.d.). Security. Retrieved May 19, 2011 from https://www.shoeboxed.com.au/security/

Shoeboxed. (n.d.). Shoeboxed. Retrieved May 19, 2011 from https://www.shoeboxed.com.au/

Note: This blog post is part of a series of blog posts that form assessment item #2 for INB347 – Web 2.0 Applications.