I've helped dozens of small businesses choose between these two platforms over the past few years. The choice comes up at least once a month in client conversations, and the honest answer — which most comparison articles won't give you — is that for the majority of small businesses, either would work fine.
That said, they're not identical, and some situations genuinely favour one over the other.
Start with Your Existing Software
The most important question isn't about the platforms themselves — it's about what else you use.
If your business relies on Microsoft Access databases, complex Excel spreadsheets with macros, or Word documents with intricate formatting, Microsoft 365 is the safer choice. Google Sheets is genuinely good, but the compatibility with complex Excel files is imperfect. You'll spend time reformatting things.
If you work heavily with other businesses and send documents back and forth, consider what they use. A firm that exchanges contracts, reports and proposals with Microsoft-heavy clients will have fewer friction points on 365.
If your team already has personal Gmail accounts and finds Google Docs intuitive, the learning curve for Workspace is lower. For a small business without an IT department, training friction is a real cost.
The Collaboration Question
Google Workspace was built from the ground up for real-time collaboration. Multiple people editing the same document simultaneously, with changes visible instantly, works very well. The sharing model — anyone with a link can view, comment or edit — is flexible and fast.
Microsoft has added real-time collaboration to Office, and it works, but the experience still feels grafted on rather than native. For teams that do a lot of simultaneous document editing, the Google experience is smoother.
Microsoft 365 pulls ahead on structured workflows. SharePoint for document management, Teams for communication, Power Automate for process automation — the integration between these tools is genuinely tight. For a business with structured approval processes, formal document management requirements, or a need for automation, the Microsoft stack is stronger.
Email and Calendar
Outlook vs Gmail. This one is genuinely close. Outlook is more powerful for complex email management — rules, categories, the integration with calendar and tasks in a single pane. Gmail is cleaner and faster for people who prefer a minimal interface.
For businesses where email volume is high and organisation matters, Outlook is the better tool for most people. For businesses where most communication is moving to Teams, Slack or similar, the email client matters less and Gmail's simplicity is an advantage.
Cost
At the time of writing, the common entry plans (Microsoft 365 Business Basic and Google Workspace Business Starter) are priced similarly — around £4-5 per user per month for cloud-only versions, rising to £10-12 for full desktop app access.
The cost difference matters if you need desktop applications versus being happy with web apps. Google's model is primarily web-based. If your team needs fully-featured desktop Word, Excel and Outlook, you need a higher 365 tier.
My Recommendation
For a business starting fresh with no legacy constraints: think about your primary use case. Heavy document production and structured processes → Microsoft 365. Flexible collaboration, simple sharing, lighter admin overhead → Google Workspace.
For a business with existing Microsoft software or client relationships: stay with 365. The switching cost rarely justifies the move unless you have specific problems with the current platform.
For a business already used to Google products: Workspace. The familiarity advantage is real, especially if you're resource-constrained on IT support.