Invoicing a crucial activity that all entrepreneurs must contend with. Many business owners find invoicing to be a tedious task that they don't enjoy. However, neglecting invoicing can have a negative impact on your company's cash flow, so it's essential to give it the attention it deserves.
So how can you make invoicing less painful and save time on this repetitive task?
Our comprehensive guide offers tips on streamlining the invoicing process without any hassle. Let's get started!
Dealing with Invoicing
Invoicing encompasses all the processes involved in issuing invoices – not only the actual creation and storage of documents, but also payment registration and deadline tracking. What steps should you take to ensure proper management of invoicing? Check out our tested tips:
Create and send invoices as soon as a project is completed! By doing this, you can avoid mistakes by documenting everything immediately. This way, your client will have a clear memory of the transaction and understand who sent the invoice and for what purpose.
In most cases, business owners choose to prepare invoices before rendering the service and send them together with the delivery of ordered goods. This approach is often used for small, online orders, as it eliminates the need for additional payment for mailing the invoice. Issuing the invoice and requesting payment before providing services helps protect against fraud and prevents wasting time on unfulfilled payments.
However, there are cases where invoicing after the service is delivered might be more suitable. This is especially true for more complex orders, such as large construction projects that require detailed planning. In such situations, you may need to consider the cost of sending the invoice.
Before initiating any work for a client or sending the first invoice, it's crucial to establish clear payment terms. This is one of the most important aspects of communication with customers – you want to avoid confusion and ensure that they understand what is expected.
Include essential details such as payment methods, due dates, and any additional fees that may be incurred for late payments. It's also important to mention your product or service warranty terms, as well as your return and exchange policy.
To ensure clarity, use simple and straightforward language. Your clients need to fully understand the invoice in order to make timely payments. Avoid using outdated phrases and opt for easily understandable alternatives. For example, instead of using 'net 30', use 'due in 30 days'.
By documenting your company's terms and conditions accurately, you can prevent misunderstandings. In the event that misunderstandings do occur, you will have written proof that you have made your clients aware of your company's policies. Remember to adhere to these rules consistently.
Would you like your clients to remember your company for longer? Make sure your invoices stand out from the rest! By incorporating important details, such as your company logo, into your invoices, customers will perceive them as more professional.
Additionally, the way your invoices look is influenced by the use of colors, fonts, and templates associated with your company. Paying attention to such details enhances your credibility and trustworthiness.
Sometimes, clients may struggle to identify information within your invoice. To avoid this, ensure that your invoices contain all the necessary transaction and business details. Also, pay attention to the appearance of the invoice, so that it is clear and easy to read. This will give you a professional image, and your customers will remember you for longer.
Using pre-set templates simplifies the process of filling out invoice details. You only need to enter the relevant information and send it to your client. By doing this, you won't have to create a new template each time and can produce a standard invoice in less than a minute!
Templates in slimInvoices encompass everything you need for successful payment collection. Choose the version that suits you, download it, fill in the required information, and send it to your client!
Also, remember to double-check that you have entered the most important data accurately, including the names and addresses of both your company and your client, invoice number, payment and due dates, payment method, product description (quantity, price, tax), and final price. It's also a good idea to include your contact details on the invoice to make it easy for clients to reach you in case of any issues.
Whether you run a large company or are just starting out, it's worth considering invoicing software, such as slimInvoices. Keeping track of paper invoices is time-consuming, and they can easily be misplaced.
Using invoicing software allows you to store and access your documents from one place, minimizing the chances of missing any invoices. It also reduces the likelihood of errors, as you can save previously entered data in the system.
Take advantage of the additional features that such systems offer. For instance, if you encounter late payments, you can send automated payment reminders to your clients. If you make a mistake on an invoice, you can easily correct it by updating the data within a few moments. Moreover, you can issue bilingual and recurring invoices, sequentially number invoices automatically, and grant your accountant access to your account.
If you frequently send out similar or identical invoices, instead of wasting valuable time creating a new invoice each time, consider duplicating a previously issued invoice. With slimInvoices, you can create a similar invoice (with updated dates and numbering) with just one click and choose whether to issue it to the same or a different recipient. Automating this process and setting up recurring invoices for regular clients can further optimize your workflow.
Clients may have different preferences when it comes to payment methods, ranging from checks to quicker "Pay now" options. By offering a variety of payment methods, clients can choose the one that suits them best. This increases the likelihood of receiving timely payments. Consider incorporating cash, checks, credit cards, or online transfers as options.
You can also facilitate faster payment by including a "pay online" button on your invoice. The easier it is for clients to pay, the less likely they are to delay or forget about the payment.
As the payee, you are responsible for any financial damages caused by payment delays. Your company's cash flow depends on receiving payments on time, so it's crucial to take action when necessary.
If the due date passes without payment, send your client a reminder message. If the client still doesn't pay, it's worth contacting them by phone. Additionally, double-check the recipient's information and resend the invoice, as it might have been sent to the wrong mailbox or the recipient might have lost it.
If your clients consistently fail to pay, consider applying additional charges. Generally, these charges amount to a small percentage of the total price. However, remember that the client should not be taken by surprise by these charges; they should ideally be included in your company's terms and conditions. If none of these measures work, legal action might be the last resort.
Have you done everything within your power, including sending reminders and contacting clients, but they still haven't paid? You need to acknowledge that you deserve payment for every service you provide. This is especially important for small businesses, where even a single day's delay in payment can disrupt cash flow. You shouldn't have to bear the expenses.
Consider which solutions might be suitable for your situation. Splitting the payment into installments or offering a partial payment option upfront might incentivize your customers to pay. If they have already made a partial payment, they will be more likely to pay the remaining amount. Offering bonuses, such as a 2% discount for quick payers who pay within the first week of invoice issuance, can also encourage timely payment in the future.
Handling paperwork on your own can sometimes be exhausting and time-consuming. That's why it's a good idea to consult your accountant - after all, two heads are better than one!
Accountants, being financial experts, can help you analyze your company's transactions and assist with late payment issues as well.
With slimInvoices, you can grant your accountant access to your account, enabling seamless collaboration on a single platform for managing your company's invoices and finances.
December 22, 2019 - BY Admin
