An invoice is a formal bill sheet sent to clients for the services rendered. It has descriptions of the items sold, the amount the client owes you and how the payment should be done. For the big companies, accountants are usually responsible for the invoicing, but for small businesses, the owners take up the role of doing it themselves.
As a significant step, streamlining invoices has a central role in determining the success of an organization. Once your small business has an accurate and efficient invoicing system, cash payments are made faster, and this can help you realize revenue. Here are some of the better ways to create an efficient invoicing system that will get you paid.
8 Tips to ensure an accurate and efficient invoicing system
Use an invoicing software
Paper-based invoices are no longer effective, leave alone using a word processor. Install invoicing software that will ensure you produce professional invoices with all the information required. This software also allows customization concerning themes, background colors, and software. Good software should allow different access levels to a wide range of users and the reporting should be in real time.
Ask yourself the following questions when choosing an invoicing platform:
- What specific features does your business require?
- Is the platform working for your business?
- How much will you pay for the platform?
- What’s the capacity of the platform (number of clients and employees it could accommodate)?
- Language options, currencies and its transaction processes?
- How secure is it?
- Is there uninterrupted customer service?
- What are the reviews from other users?
Keep accurate records
Before you now decide to send the invoice, the business should be well aware of the works done and how it was undertaken. For professionalism, it is recommended that you keep track of the ongoing work from time to time, you could use a time-management platforms available online. All the data concerning the ongoing work should be keyed into the accounting system appropriately.
Use clean and consistent formatting
For all small business invoices, follow clean and consistent formatting. Simplicity should be at its peak while at the same time effective. One thing about invoices is that clients read them quickly, so try and make the invoice as easy to understand as possible. Fine details such as the due date and amount should be clearly labeled.
Brand your invoices
The best way to speed up payments and avoid your invoice being ignored is to include logos. Your trademark on your invoice makes it stand out from the others, and it is also a vital sign of professionalism. You could go ahead and incorporate brand colors or even look for an excellent template that equates to your specific brand. There are pro graphic designers out here you could seek for their help, and they will sort you with the perfect logos.
Familiarize yourself with some of the invoicing terms
You need to be acquainted with some of the invoicing terms that are commonly used in business payments. These include terms of amount delivery, sales cost, payment methods, and the due dates. Let’s look at some examples:
- Immediate payment: means that payment should be once the invoice is received.
- Net 4, 9, 15, 25: we’d rather you use the days instead of the net. For instance, instead of net 4, say payment should be done in four days.
- Beware of the line of credit used to pay.
- Interest invoice: this includes the invoice along with its penalty of interest charges due to delays in payment.
- Invoice factoring: happens when you sell an unpaid invoice to a factory company.
Terms and conditions apply. These policies should be known by both the client and seller. This is just so to avoid unnecessary confusion and disputes. All invoices should contain the terms and policies, and they should be straightforward and easy to understand with no hidden catches. Policies regarding any irregularities or eventualities should be communicated to avoid any surprises in the event such happens.
An invoice should contain all the relevant information
All the relevant information regarding the business owner and the client should be captured. This might include:
- Product service description
- Total amount
- Order number
- Due date
- Payment options
- Discount details, in case there are any
- Outstanding charges
- Delivery charges
- Delay in payment charges
- The contact number of the business owner
Multiple payment options
Having an invoice with multiple payment options for clients to choose from is also an excellent idea. For instance, you could include a link for online payment options. Or even payment in installment options to ease collection. The vastness in payment options leaves your client with no option but to go for one.
Having an accurate and efficient invoicing system is an essential prerequisite for small business owners. It not only opens you to a wide variety of payment options but also strengthens bonds between clients and business owners; it even better portrays high levels of professionalism. You now have some of the best invoicing tips, make good use of them and take your small business to the next level.