Invoicing is the process by which a company gets paid. A company sends an invoice for services rendered, and the client pays the charges. For a small business owner, invoicing may seem as straightforward as that. That assumption is wrong. How your company invoices clients can affect everything from the timely payment of a service to how you retain repeat customers. Good invoicing can speed up the payment process and give your company a more professional look. The following tips can help optimize your small business invoicing.
Invoice As Soon As Possible
Send invoices to your client as soon as possible after the work is done. This ensures the service is fresh in the client’s mind. Therefore, they’re more likely to remember to pay you. It also makes it easier to track how much time each client must pay if you bill them right after your finished. This will ensure you’re not letting invoices go unpaid. For best results, have the invoice ready when presenting the work to the client. Don’t lose time being paid because you waited to bill them.
Automate The Invoice Process
A great way to speed up invoice generation is to buy automating software. A wide range of accounting software offers invoicing capabilities. The software takes over the data entry part of invoice creation. Since it can cross reference with your accounts, the software produces less errors then an employee doing the same job. They types of financial tools free up your team to do more advanced work. Automated invoicing will get your invoices out to the clients faster and cheaper.
Offer Wide Payment Options
Always make sure it’s easy for your customers to pay you. The best practice is to be able to take payment from a customer as you present them the invoice. Establish methods of payment with all the major credit cards and mobile payment processing services. Also make sure to adjust your prices to cover processing fees. In all cases, it’s important that the invoice have clear instructions as to how to pay you. Make sure the invoice has any information they need to pay by any method. This will not only encourage prompt payment. Customers will be encouraged to use your company again if they know it’s easy to pay you.
Number Your Invoices
Give each invoice a sequential number. This is a nice touch of professionalism for the customers. It will also make it easy to track individual invoices in your accounting system. This will save time when you file taxes and need to check numbers in a hurry. With numbered invoices, any transaction with your company can be found electronically in a matter of seconds. Record keeping is as important a part of invoicing as bill collection. Numbered invoices will ensure your record keeping remains clean and efficient.
Offer Prompt Payment Discounts
Instead of punishing clients who pay late, consider rewarding clients who pay on time. This can incentivize prompt payment without building resentment in your customers. This can be useful if your company prides itself on being inviting and friendly to you customers. With that sort of marketing, late fees can come off as professional but cold. A prompt payment discount achieves the same result but ensures your company will retain its friendly reputation. You can continue to build an emotional connection with the customer and get paid on time.
Improving your invoicing practices can make a real difference in how your paid by clients. A few simple tips will improve efficiency and encourage the customer’s loyalty. Create invoices online and send them out as soon as possible to assist in prompt payment. Automate your invoice process to save time and money. Offer a variety of payment options to make it easier to receive payment. Number invoices to streamline your records. Offer a prompt payment discount instead of a late payment fee to establish a connection with the customer. These tips will help your small business invoicing do what it does best, make you money.