Invoicing has always been an essential part of a business, and it plays a fundamental role in business success. Creating and sending invoices is an integral part of any business. It helps keep an eye on the cash flow and proper receipts to back it up with. Therefore, it is important for every business, whether small, SME, or big. Your business might want to be paid bills on time and save from late payments.
If you are facing the issue of late payments and poor invoicing strategy, then you might want to learn or know about some effective ways and practices to adapt. Read this article and get the best invoicing practices for your business in an efficient manner.
It is a good practice to mention the invoice creation date. Make sure that the date of goods or services delivered is also mentioned.
You should give a unique invoice number when sending multiple invoices to the same client/customer.
Address the name of the concerned person named on the invoice, and don’t just include the name of the company. Referring to the right person works as a means for the financial department in case of questions or important information concerning the billing.
Make sure to include the information name, address, contact number, and email address of all the parties involved in billing.
Clarify the payment terms that indicate how long the client has to pay to you, i.e., net 30 (due in 30 days), net 60 (due in 60 days), etc., as per time duration.
Make it concise as you can, refer to complete milestones/goods or services that you outlined in your contract.
If your business is using SKU (Stock Keeping Unit) numbers for goods or services, then include them. This will help while pricing and determining what goods are taxable.
Make sure to include all the costs of included items, subtotals, taxes or discounts, and the grand total.
Include if you are giving discounts for early payments or charge for late payments clearly.
Clearly define the mode of payment and indicate all options for how to pay. Let them know how they can pay you.
Be straightforward in the totals so that your client will understand how you arrived at the total. Make it easy for your client and keep your invoice to one page if possible.
With the completion of the project, you need to send an invoice promptly. The early you send, the better the chance of getting paid on time.
Give your customer multiple options to pay your invoices. If you are issuing invoices for international payments, then you need to indicate which currency you accept.
It is an opportunity for you to explain what value you are providing to your client and charge for. Describe it concisely to remove any confusion.
When you haven’t received payments, then you should take professional follow-up. Make a schedule for following up, and this will make the process easier and less frustrating.
Keeping track of all of your late business invoices. It’ll help you in balancing your accounts.
The most important step is to keep it simple and short. Try not to make it an over-complicated invoice with lots of jargon or a complex layout with multiple pages.
Putting a thank you note keeps it friendly. You can personalize it or keep a standardized one.
Often invoice is the last direct communication you have with your client, and you need to make sure that it is not going to be the last one. Give thought to your invoice and ensure all of the mentioned best practices are followed. Make the tone of voice friendly and make it beautiful. Invoice is a branding opportunity, and you need a proper layout of the invoice along with all the important descriptions.