9 Important Small Business Invoicing Tips
As a small business owner, you know, wearing multiple hats is part of the job description. While this is true, one of the most time-consuming jobs you have is invoicing.
Once you understand all the ins and outs of invoicing, you gain a bigger appreciation of the term, “time is money.”
While small business invoicing can be overwhelming at times, some tips may help. Are you ready to learn more? If so, let's get started.
1. Automate Your Invoicing
When you invest in automation for your invoicing, you gain a lot of benefits. For example, the right software can help you compare projections with what is going on and can help you save time.
Also, the right software can help you reduce mistakes that occur when you bill your customers manually. As time passes, you will likely save a lot of money.
2. Give Quotes and Agreements before Sending an Invoice
Minimize the possibility of disagreements and questions later when you send your invoice by taking a proactive stance. This means ensuring your customer understands what the project includes and the costs of the work.
You can use these examples to see how to ensure the information is clear and fully understood.
Having an agreement in place will also help clarify your payment terms while establishing a more positive work relationship from the start. This will help prevent more questions in the future.
3. Figure Out When You Will Invoice
This is a crucial part of maintaining positive cash flow. In most cases, the right time to invoice is when you have delivered the product or service to a customer.
However, for other businesses, having a retailer or monthly contract means you must send monthly invoices. Regardless of when your invoice, it is important to know when this is going to happen. This information will help improve your cash flow management.
4. Add Numbers to Your Invoices
If you have a client who has a question about their invoice, being able to find the document quickly is a must. One way to ensure this is possible is by numbering your invoices.
This is going to let you track payments and reference the documents later. If you use invoicing software, this should not be an issue.
According to some invoicing experts, you should not label your first invoice as 001. This is because customers will relate a higher number with more experience. Just choose a higher number and start there.
5. Add Branding and Details to Your Invoices
Each invoice you create needs to identify your company and brand clearly. This will help your clients understand where the invoice is from.
Also, by doing this, you can continue to emphasize your brand’s value. That’s because you are maintaining consistent attention in every communication.
Make sure you include contact information on your invoice, too. This includes your address, email, and phone number.
Never leave off details about the payment terms or work done, either. Even if those are included in a quote or agreement, you should reinforce this on your invoice, too.
6. Create a Professional-Looking Invoice
If you are using accounting software, you will likely have templates available to make the document seem professional. Remember, the more organized and professional you seem, the more likely you are to be paid quickly.
Be sure that your business logo stands out on the invoice. You should also include all legal and registered details, along with the contact information for the person receiving the bill.
Be sure to check you have the right numbers on your invoice, too. This includes additional taxes or costs.
7. Set Shorter Payment Terms
You need to be precise when specifying your payment terms. Customers may view things like “payment due on receipt” as vague. Be concrete by including an actual due by date.
Thirty days is considered standard. While this is true, you can customize your payment terms to suit your needs and business.
8. Remain Positive and Polite
Your invoices are another engagement and interaction tool with your customers. Therefore, you need to use polite language in the content.
You should also provide a payment acknowledgment after they pay. This will help to solidify your relationship. You also can show your customer how much you appreciate them.
Sometimes, additional messaging is appropriate. For example, add “Happy Holidays” at the end of the year. This helps to build a positive environment and can encourage clients to pay faster.
9. Stay Organized
You need to have an effective way to track your invoices so that you can reconcile your payments with them. As mentioned before, each invoice sent should have a unique number.
If you use an accounting system, this can be done automatically. After payments are reconciled, you will be able to see who still has to pay. You will also know when a client or customer is late.
Making Small Business Invoicing Easier
Unfortunately, small business invoicing is something that must be done when you own a business. While this is true, it doesn’t mean there are not steps you can take to make the entire process a bit easier.
To ensure that your invoices are paid in a timely manner and that you stay organized, consider implementing some of the advice above.
Learning more about your business and how to keep things running smoothly will help you personally, too. For more personal wellness and growth resources, be sure to take a look at some of the other blogs posted on our site.