The Do’s and Don’ts of Invoice Writing
As a small business owner, one of the most crucial duties you have is to prepare invoices. After all, business invoices are the first step in earning the revenue your company needs to function efficiently and assisting you in paying personal expenses like mortgages and health insurance. Your cash flow will be healthier if your small company invoices are done accurately and professionally, issued quickly, and followed up regularly.
Implementing excellent invoicing practices and a billing process ensures that you don’t end up with a stack of unpaid bills and reduces the need for you to keep track of late payments. Detailed customer invoices also assist you to prevent client conflicts about what they’re paying for and when they’re paying it. Invoices and payment records can assist you in rapidly obtain income data for your accountant when tax season arrives.
The Do’s and Don’ts of Invoice Writing
Customers will be impressed by your professionalism and punctuality if you send them invoices on time. Make the most of every chance to engage with clients since it reflects on how you do business.
Do’s:
1. Keep surprises to a minimum.
-Ascertain that your consumers are aware of when an invoice will be delivered. To minimize misunderstanding, lay out the costs and itemizations. Your company invoice should reflect your initial estimate and contract, giving your clients a sense of certainty. Explain the difference to consumers before sending the invoice if the invoice total exceeds the estimations or the agreed amount or new costs.
2. Make sure you have your dates straight.
-After your company logo and contact information, the invoice date should be the first thing that people see. The due date should be prominently displayed, letting clients know when they must pay. Also, make sure that the invoice item descriptions include dates for job completion or delivery. Invoices and payments that are past due should be followed upon.
-Follow up with payment reminders if you haven’t heard from your consumer after issuing an invoice. Invoices might get lost in the mail, and electronic invoices can land up in a customer’s spam folder, resulting in a late payment. Start tracking the days and weeks until your payment due date, which should be mentioned on the invoice, as soon as you know a client has received an invoice (15 days, 30 days, etc.).
-Clear payment terms with a deadline are necessary because they provide a foundation for follow-up in the event of nonpayment. Customers are likely to file your invoice late if you don’t explicitly specify the expected payment date. Resend your invoice with a message indicating that it is overdue if the payment has not been received. Reminder emails can be automated using small company invoicing software.
3. Check if your invoice design is clear.
-An invoice serves as your company’s public face to your consumers. It should highlight your brand and contain distinguishing elements like your logo. However, the substance takes precedence over the graphics — an invoice is not the place to be sweet. Above all, make sure the info is clear and easy to comprehend.
4. Make your invoice as thorough as possible.
-Less may be more in certain aspects of customer communication, but not when it comes to small company invoicing. List itemized commodities, fees, expenditures, and significant dates to avoid misunderstandings.
Don’ts:
1. Don’t be afraid to send out company invoices.
-It might be difficult to request payment, especially if you’re just starting in the company. Customers will notice that you respect your work and trust in the items and services you’ve produced if you boldly demand payment for your services. Customers have already requested your goods and services; therefore, you’ve already gained business. The invoice demonstrates that the job has a monetary value.
2. Don’t wait any longer.
-Don’t invoice too soon – before an agreed-upon milestone has been met, the project is finished, or the product has been delivered – or too late – weeks or months after the job has been completed. Customers should receive bills when the product or service is still fresh in their minds, so the invoice does not come as a shock. Invoicing immediately communicates professionalism and trust, as well as the expectation of fast payment.
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Related article: Strategies to Earn Client Trust
