Getting paid on time is a significant problem for many small businesses. It’s often down to invoice processing. Email an invoice directly to the person in charge of accounts rather than having it go into the general inbox. It helps to reduce the chances of it being overlooked.
Automate The Process
Manually managing invoices is tedious, time-consuming, repetitive, and plain. Automating your invoice process can make your business more efficient and help you get paid faster!
It’s essential to audit how you currently process and pay invoices and then weigh whether it’s worth implementing a new system. If it is, choose the best invoicing software for your business needs and requirements. Your online invoicing tool should be easy to use and not become an additional administrative task for your team. To personalize the solution, look for options that fit your business’s needs and goals, such as recurring billing and multiple payment channels.
Invoicing software can also save you money on processing fees, reduce your carbon footprint, and look more professional than sending paper invoices by mail. The invoice management software offers templates you can customize with your company’s branding. The software also includes helpful features for automating tasks such as setting up recurring invoices with specific start dates and intervals, sending notifications for upcoming or overdue invoices, and automatically tracking tax circulations. With this software, you can concentrate on your core business while letting the invoicing software do the hard work.
Set Up a Payment Plan
Not all clients have the financial capability to pay their invoices in one go, so allowing them to split their payments up into installments can help. It may be a milestone-based payment schedule where they make a small payment at precise intervals when small tasks are completed or a more flexible monthly or weekly payment plan. You can manage your installment plans or outsource this responsibility to a third-party vendor.
Either way, enabling this option can help you increase your sales opportunities by increasing the number of clients willing to buy from you.
Choose a billing system that supports these features to ensure you can manage your installment payments effectively. Look for email invoicing software that offers professional invoice templates and allows you to track if an invoice has been sent, opened, or paid.
Ideally, you can also see what has been paid so far and the outstanding balances. Additionally, look for a system to store all invoices in date order and improve overall organization. It will allow you to quickly access records, whether for an audit or checking over a specific anomaly. Improving the clarity of your invoice will benefit you and your customer. It guarantees that both parties understand the total amount owed and its components.
Set Up a Reminder System
Sometimes, it may be necessary to send multiple invoice reminders before the invoice is paid. It can be especially true for clients that pay via bank transfer, as these payments may take time to arrive in your business account. Ensure the subject line states the invoice number and status when sending reminder emails.
Also, please attach a copy of the initial invoice and instructions on settling the payment, including any relevant terms or fees. Try to keep the tone polite and straightforward, but it’s okay to be firmer if the payment is still overdue after several invoice reminders have been sent.
A reliable invoice management system will enable you to set up automated invoice reminders that can be customized and sent regularly. It will improve overall organization and help you track payments. You can even include hyperlinks to different payment options in your reminder emails to give customers an additional nudge toward settling their invoices.
Regularly auditing your accounts receivable is a wise decision. It will ensure that you’re sending invoices promptly, electronic payment methods are functioning seamlessly, and that you aren’t encountering any issues with your client’s payments. You can then take steps to address any problems or inefficiencies that you come across.
Set Up Automated Follow-Up
Once you have an automated invoice management process, it is essential to monitor it continually. It includes checking the status of payments made, reviewing recurring invoices, and looking for areas where you can further automate or improve processes. It is a crucial step for small businesses, where missing or overlooked invoices can be easy. By taking a proactive approach to invoice management, you can take advantage of actual payments and ensure your customers or clients can make timely payments.
Depending on your invoicing platform, you can automatically send follow-up emails when an invoice goes unpaid. One effective way to provide reminders to customers or clients is by using a system that saves time and reduces frustration by automating the process.
Some of these systems even include a “ping” feature that alerts you when a payment is made, allowing you to check the status of the invoice quickly. It will improve organization and be helpful if there is ever an issue with a past-due invoice or any confusion about the details on an invoice.
My Life, I Guess is a personal finance and career blog by Amanda Kay, an Employment Specialist and older millennial from Ontario, Canada that strives to keep the "person" in personal finance by writing about money, mistakes, and making a living. She focuses on what it’s like being in debt, living paycheck to paycheck, and surviving unemployment while also offering advice and support for others in similar situations - including a FREE library of career & job search resources.