Money is one of the factors that keep your business running. However, handling your business cash flow can be a nightmare— it can be time-consuming and frustrating. Even after the tedious process of creating and sending out invoices, there is still no guarantee of on-time payments.
That is why having a capable and efficient invoicing and billing process is critical. In this article, we have listed five tips to help improve and streamline your business’s billing management and invoicing processes.
- State Payment Terms Clearly
Before you start working with a client, you need to agree on a set of terms. It is the basis for good relationships, avoiding surprises and frustrations, and ensuring that you get paid on time.
Your payment terms and policy should clearly state the following:
- Whether you’re paid on an hourly or daily basis
- When the project must be completed
- Your fee and any extra fees
- The mode of payment you accept
- The timeframe in which your client is expected to pay the invoice
- Any penalties charged if the bill is past-due
- Automate The Process
If you’re invoicing and billing process is still manual, then you’re wasting time and effort. Going digital and investing in the best billing and invoicing software can help streamline the process and offer significant benefits to your business.
Good software can help you manage and organize invoices and billing, ensuring that you stay on track with your business’s money flow. It also helps in reducing paperwork and human error, ensuring that the correct details and invoices are sent to the right clients.
Although reliable software is not free, it is more cost-effective than manual invoicing. Online software can eliminate the additional cost associated with envelopes, papers, and postages of a traditional invoice. Plus, there’s also the fact that it helps save employees time, so they can work more on other essential tasks that benefit your business growth.
There’s a variety of software out there with different features at various price points. So, before you settle for invoicing and billing software, you must consider your business’s needs.
That said, regardless of the feature set, good invoicing and billing software will surely save your company countless hours and frustrations by eliminating manual data entry and ensuring an automated process.
- Look For Cloud Solutions
To make the most out of your invoicing and billing software, you want to ensure that it is a cloud-based system.
The standard invoicing system can only be installed on your computer systems. For startups and small businesses, this may be enough. However, if you’re looking to grow your business and work with numerous clients, the standard systems can be very limiting.
At this point, you want to look for a cloud-based system. A cloud invoicing and billing system allows for real-time syncing of data between devices. This allows your employees to track and send out invoices instantly.
Not only can it help in speeding up your billing process, but it also gives every relevant employee a real-time overview of the current process, eliminating manual errors and outdated data.
- Send Invoice And Follow-Ups ASAP
Once you’ve completed a project, an assignment, or a product for your client, don’t wait for them to ask for an invoice. Prepare an invoice right away and submit it to them as soon as possible.
After all, the more you delay in sending invoices to your client, the longer it takes for you to get paid.
For recurring clients, you can use your invoicing software to set up schedules of sending invoices as soon as the agreed-upon invoicing date arrives.
Now, if your client doesn’t pay your invoice after a few days, don’t hesitate to follow up and send them reminders on the upcoming due dates. You can do this a few days or even a week before the due date.
Sending reminders to ensure that you get paid on time while also benefiting your clients in avoiding late payment fees.
Most invoicing software also comes with a scheduling setting for payment follow-up, so make sure to leverage this feature.
- Be Detailed
Vague or unclear invoicing is not only bad for your record-keeping, but it can also slow down your client payments.
Your client may have to check their records to determine what you’re billing them for or a Q&A standoff that can last for days that delay payment. So, make sure to provide detailed billing descriptions.
For instance, instead of:
‘USD $250 for yard work’
You can write it:
‘December 2021 lawn care (USD $50), mowing (USD $50) and planting of four shrubs (USD $150)’
You should also include a unique invoice number for better tracking. You can add purchase order numbers and direct business contact. It is helpful if many people are involved in the approval and payment of your invoices.
Conclusion
Invoicing and billing can be overwhelming. However, knowing to handle the process efficiently can streamline your business processes.
Make sure to follow the above tips to get paid on time and have a desirable cash flow that can help your business grow and thrive.
