Get your invoicing right
One of the most frequent and often costly issues that we see a business make is with invoicing. In order to facilitate a smooth process of being promptly paid by your customers we recommend that you follow our top invoicing tips:
Keep things simple and clear
Customers don’t want to see an overly complicated invoice with lots of lines and charges that are not fully clear. Make sure the language used is not too technical, that the content is displayed in a simple format and the money owed is itemised. Make it very clear how and when payment should be made, put this as close to the money owed as possible.
Be efficient
Don’t delay in sending your invoice. Once the work is completed and the customer is happy have an efficient process for requesting payment. Consider always sending invoices on e-mail, that way you have proof that it has been sent and can always set-up a read request just in case. Also, make sure you send the invoice to the right person!
Keep accurate data
Consider your invoice as a legal document, you must make sure it has the correct company name, address and contact details. If it is not correct then a business can quite easily reject it, causing long delays with getting paid.
Make it easy for payments to be made
In the past invoices would have lots of options for making payment, this could be by cheque, by direct bank transfer and even by cash. Only select the best options for you and ideally just select the direct bank transfer as this means payment clears into your account promptly.
Don’t try to be creative
If you need to add extra fees on to your invoice, ensure everybody is fully aware. The last thing you want is to create an invoice with added charges which your customer can reject because they were not expecting them.
Build a good rapport
Typically, invoices are always sent to the same person. Do everything you can to build a good relationship with them. Be polite in your covering e-mail, address it personally, ask them a question about how they are and always thank them at the end. They can dictate when they pay you so make them your best friends.
Have the right tools and processes
Make sure you use an online accounting software programme to prepare your invoices and keep track of payments. Build into your monthly schedule time for invoicing, be strict with it so that it is always a part of your regular routine. Efficiency is key.
Don’t rush
When we rush, we make mistakes and the last thing you want is a mistake on your invoice. Check, double check and triple check the information is accurate before it is finalised and then sent on to the customer for payment.
Don’t be too generous
Any business will want to take advantage of the longest possible payment terms. Don’t be too generous when you set-up your terms. Make sure they fit you and your business, be consistent month on month with your payment terms and keep this to the shortest possible term
To conclude do not fall into bad habits with your invoicing procedures. Consistency and accuracy are key. If you make the process as seamless and easy as possible then you put yourself in a strong position for prompt payments from your customers.
If you are looking for a little help with your invoicing or need some general accountancy support, please call us on 01173 700 079 or e-mail hello@steppingstonesaccountancy.co.uk. You can also book a free 30-minute call with Yarka – https://calendly.com/yarka-ssa/30min
