If you’re a small or medium sized business or freelancer, invoicing can feel tedious, but it is essential in maintaining a positive cash flow. Being paid on time means that you need to be proactive in establishing a system that works with your clients’ needs as well as your own, and certifies you as a professional.
Minimizing invoices is a good first step, particularly for startups.
This allows for payments to be collected faster. Ensure that each invoice is accurate and complete before administering it promptly after a service. Discuss the details of invoicing at the beginning of a customer relationship so that terms are mutually agreed and everyone is on the same page.
Get to know your customer’s preferred pay cycle. It is likely they have set their own methods for payment and by allowing this to coincide with when you send them invoices, getting paid on time is much more likely. If, for example, they prefer the first of the month, you’ll have far greater success by setting due dates that sync with those of your customers’ pay cycles.
There is no one-size-fits-all approach to invoicing, as relationships and circumstances between business and clients vary, but it is vital to set up a regular invoicing method to continue a positive cash flow.
Let’s take a look at some of the best times to invoice your clients.
- Immediately. No matter the intervals, invoicing right away is going to give you the best chance of being paid on time. When the work is finished or when the service has been provided, it’s time to send that bill. Again, you can negotiate when this invoice is sent, but after the initial terms are set out you need to maintain strict adherence to the due dates. You can stagger the invoices as the work is being completed or ask for up-front payment, but the key is not to delay. Putting off invoicing pushes back your payday.
- Recurring invoicing. Scheduled charges agreed upon by all parties are a great option when the working relationship is ongoing and services are being repeatedly purchased. The main benefit here is convenience, for both the supplier and consumer. Payment information can be taken once, and the merchant can be authorized to keep these detailed safely stored and use them to charge each time a service is rendered.
- Weekly, bi-weekly, or monthly. Recurring payments need to have agreed terms and timing, and these are some of the most common intervals. Unlike clients whose need for services is uneven and probably require a retainer, a great way to preserve cash flow is to regularly invoice. Again, confer with your clients before a job begins to work out which method works for both of you, and bill weekly, bi-weekly, or monthly.
- Automate your invoicing. A fantastic and easy method of invoicing which is cost-effective and accurate is to set up online accounting software. The hassles of remembering invoice dates, customer details, and follow-up emails can be taken completely out of your hands with the right software. Your preset recurring invoices will be sent automatically on the correct dates, and reminders of upcoming or overdue bills give your clients a gently nudge. Choose a cloud-based service to create and send your bills and to safeguard sensitive payment information. The automation of the bill process also means you are more likely to be paid faster, too. The online payment options built in to most software allow ease and security for your clients when settling their bills.
Don’t forget to invoice!
There are times we are so busy that it is easy to forget due dates and invoicing when a job is complete. And don’t wait, either. It’s not rude to bill for payment after you have provided a service, and waiting means slow cash flow. In order to get paid, you have to send the invoice.
Make invoicing a priority by using these tips and trying Invoice Tracker with a free, 30-day trial. Set and forget your invoices, and get paid faster.