Subscribe for updates from our blog so you don’t miss out:
Invoicing: the sending of an itemised bill to a customer to charge for your goods or services. Sounds simple, no? However, the reality of generating invoices on completion of work or at end of month is often very far from simple, with countless spreadsheets and small projects resulting in the loss of a few days of productivity and the cause of one too many headaches. Luckily, you don’t need to resign yourself to facing a losing battle when it comes time to invoice. There’s light at the end of the tunnel…
Invoicing is meant to help streamline the process of receiving your revenue, but inefficient invoicing process can end up costing you time and money instead.
So, why do businesses get what should be a simple process so wrong?
The issue with invoicing…
Managing a lot of different information for each client can be tricky. Tracking different jobs, the amount of time spent, how much of the project has already been completed, what has already been billed vs what is yet to be billed – it’s not a job for the faint hearted. And having multiple spreadsheets open to track all of this information makes it all the more complicated. In this case, less is best.
Or perhaps you’re confused around correctly invoicing corporate clients who need PO numbers, the best day of the month to invoice a client, or the ideal payment terms. Each of these can seem daunting but is easily solved with a proper invoicing process.
For many businesses, a complicated invoicing process could even be losing you money. How many little odd jobs that took 15 minutes haven’t been invoiced because it takes longer to create the invoice than it did to do the work? A ROLL client did the math and estimated they were loosing up to $1,200 each month by not invoicing for these ‘little’ bits of work. Every business needs to streamline their invoicing process. It HAS to be efficient.
Streamlining your invoicing process
So, how do you even begin to simplify your invoicing process?
- First things first – say goodbye to spreadsheets. Find good software that pulls all of your information into one place. Whether ROLL or another programme, it’s certainly worth your investment (and sanity) to integrate all your time tracking and billing information into one place. One large company went from a 3 day invoicing process to a 2 hour process using ROLL. That's massive.
Once you have your shiny new software and you’re setting up your new invoicing process, consider what works best for your business:
- 7 day payment terms, or the 20th of the month? It should depend on what’s feasible for your cashflow. The number of larger corporate clients you have with 20th of the month pay cycles may contribute to this decision as well.
- Is it best to invoice as you finish projects, or at the end of the month? Invoicing as you go is better for cashflow and one-off projects that finish before the end of the month. Invoicing at the end of the month is great for retainers and work throughout the month.
- Could you charge a deposit or do progress payments? Invoicing for a deposit is recommended, especially for projects over a certain amount (often $1000 or more) and you’ll get clients used to paying you. Will your deposit be the same no matter the size project, or will you reduce the percentage deposit for larger jobs? For ongoing projects, perhaps you could take a cue from the construction industry and consider progress payments.
- When will you follow up on overdue invoices? At ROLL, we recommend a 7 day overdue reminder, or if the project is a big one, it’s best to get on the phone with your client to remind them. Xero (which is able to be integrated with Roll) can send automatic reminders for you.
Your software is set up and your new invoice process is in place. Now what? Your invoicing process should be smooth and quick – you’ll be sending invoices for those ‘little’ jobs and getting paid for ALL of the work you do. And, since you won’t be spending days on invoicing, you can focus on what you do best and let the software to do the rest.
At ROLL, we want to see you running a better business through amazing software and invaluable information. Find our blog helpful? Sign up to get our updates above... Want to try our software? Click here for a free trial.