Photo Source: Shutterstock
Whether you run a small business or a large company, invoices are a part of everyday life. Your invoice process may be run as a one man show if you own a small business, or may even take a larger system set in place for large businesses. Whatever the case, having an efficient and functional invoicing process is fundamental when running a business. If you are looking to fix your current invoicing process or simply implement a few upgrades to it, this is the article for you. Read on to find out more!
1. Create An Agreement and Stick To It
Most successful endeavours run on agreements, and your invoicing process is no different. As a business, you need to create a list of agreements that your contractors will have to adhere to, in order to protect not just your rights but theirs too.
When it comes to the factors that should be discussed and agreed upon, you’ll have to focus on things such as whether you will be using an invoice app, the scope of your project, the rates agreed upon, what kind of payments will be accepted, how long the client has to pay the invoice, as well as any penalties incurred for late payments.
Agreeing on this upfront and signing a contract for it is the best way to prevent any future disagreements, hassle or loss of revenue. Things written in fine print are a fantastic insurance plan, so hop on that agreement train and stick on for the ride!
2. Structure Invoices
It can be slightly frustrating when 10 different people send various invoices in different formats, as this can cause confusion and unnecessary mistakes. Similarly, if you are the one sending invoices out, you will want to keep them adhering to a certain structure, look, style, or format. It is always advised that a simple and clean design be used, with text that is easy to read.
Information such as contact details, invoice numbers, dates, due dates, final costs, and task/project names should be streamlined and this format of invoice should then be used as your standard template that everyone should follow. This will help your accounts department sort through invoices a lot faster. They will be familiar with exactly what they need to do with each invoice, instead of unnecessarily trying to decipher various forms of invoices. There are multiple invoice templates available online should you need some inspiration, so get browsing today!
3. Organise Your Invoice and Billing Process
Organising your invoicing and billing process is so incredibly important for a business to run smoothly. Whether you have 10 clients or 100 clients, it is important that you manage your billing and invoicing processes in the same way for all of your clients. Consistency and attention to detail with all your invoices/bills will help you make sure that nothing is left out, looked past, or muddled.
Reconciling your accounts will also be made that much easier when everything is organised and in proper order, so this is a win-win situation for all. You can choose to organise these processes manually, or with the assistance of software and third-party services, depending on your individual needs.
4. Get Rid Of The Paper
If you’re still using paper in your invoicing and billing process, it may be time to move onto digital invoices. Paper invoices are old fashioned, easily lost, and extremely time consuming, so consider using cloud-based invoicing systems and online invoicing instead. Online invoicing also ensures people can refer to invoices on their phones should they not be at their work desk, and gives all parties the opportunity to pay them off immediately with services such as Paypal or direct debit transfers.
Online invoices also do calculations on your behalf, ensuring you don’t make any errors in your calculations which can cause precious time to be lost and payments to be made late. Furthermore, you’ll be saving the environment, which is something we should all be making a conscious effort to do.
5. Too Many Cooks In The Kitchen
Last but not least, when it comes to invoicing and billing, you don’t want too many involved in the process. This is because a limited number of people handling invoices prevents accounting issues such as duplication, leaving out information off invoices and any other forms of human error in general. With less people involved in the process, you’ll be avoiding severe mistakes that can be very detrimental to your business. Hire as many as it takes to run the system efficiently, but always remember that too many cooks spoil the broth!
We hope that this article has given you some insight into how you can fix your current invoicing process.