5 Tips For Effective Invoicing
Invoicing is a vital part of maintaining a healthy cash flow, and, subsequently, a healthy business. Especially if your business is new or on the small side, the time it takes for you to receive payments can determine your business’s ultimate success or failure. Invoicing is a hassle if you aren’t armed with the right knowledge. Use the following tips to take your invoicing from frustrating to fantastic — well, as fantastic as invoicing can be.
Be Consistent And Clear
If the language in your invoice is unclear, or if you bury vital information, your invoices may confuse your customers. They may not even realize that the piece of paper in their hand is an invoice. Be sure that you use proper grammar, spelling, and punctuation, and clearly mark the amount due, the due date, and the services or products rendered. Also give clear instructions regarding your customers’ payment options. Further, if you live in an area with a large ethnic diversity, you may want to be ready to translate your invoices into a few different languages. Don’t rely on online translation services. It is always best to have a person who is fluent in both languages check the translated invoice for any errors that could hinder your customers from paying as soon as possible.
Use Invoicing Software
Old fashioned spreadsheets have their time and place, but there are better software options for invoicing. According to NerdWallet, “Using invoicing software reduces mistakes and saves money. Businesses that automate their billing processes reduce invoicing costs by 40% to 70%, according to a 2012 report by Ardent Partners, a Boston firm that researches supply management. Automation also makes invoicing faster, freeing up time for entrepreneurs to focus on running their business.” Look for a cloud-based online billing software, such as Sage One, that simplifies the invoicing process through smart features such as a mobile application and the option to email your invoices right from the software.
Offer Flexibility
Although many consumers are now comfortable with paperless billing, you’ll inevitably come across individuals who would prefer everything to be documented in hard copies. When you’re performing services for your customers, you can ask how they would like their invoice to be delivered — via snail mail or email. For those who favor snail mail, send a pre-addressed envelope that customers can use to send their payment. For people who want to pay via the Internet, be sure that your online payment system is secure and easy to use.
Track Invoices, And Send Polite Reminders
You want your money as soon as possible, so be wise about choosing due dates for your invoices. Many companies allow 30 days from the date of the invoice. Be diligent about tracking your invoices so if a customer hasn’t paid and the due date is fast approaching, you can email a polite reminder. When customers are late, be clear about the consequences of non-payment. The consequences could be in the form of extra fees, cessation of services, or, in extreme instances that involve a good deal of money, a court case.
Update Your Technology
Even if all your customers are good about paying on time, your payment process could still suffer if you don’t have the right tools at your disposal. As mentioned earlier, online accounting software is a great asset, but that isn’t the only technology that can improve your invoicing process. Think about investing in a smart device, either a tablet or smartphone, that is compatible with your accounting software’s app and that offers other business friendly features. You’ll be able to work on invoicing from anywhere.
Business News Daily compiled a list of the best smartphones for small business owners, and the Samsung Galaxy S6 came in at the top. It’s a secure phone with a fast processor and helpful multi-tasking features. Other phones you might consider include the iPhone 6s Plus and the Google Nexus 6P. Don’t let inefficient invoicing be your downfall. By using the right technology and giving careful consideration to your customers’ wants and needs, you can streamline the invoicing process and contribute to your business’s positive cash flow.
