For new businesses, raising invoices and getting paid for work done is a new thing so here are some pointers on how to go about it.
The main things to consider are making sure the invoice has all the information required and that it looks professional. Giving a customer a hand-written scrap of paper isn’t exactly going to inspire confidence or lead to repeat business so if you get it right from the start you’re already on the right track.
Information you should always include as a minimum is as follows:
Your business logo always makes for a nice professional looking invoice if you have one so make sure it is included whenever possible. It will also make you more recognisable to your customers and therefore more likely to lead to repeat business.
The method of raising the invoice can be quite important too. We would always recommend doing this from your accounts software if you have some as this means the information is already exactly where it needs to be without any further entry. This will also help you keep track of payments and overdue accounts. Alternatively, there are other apps on the market that do a similar thing and might even integrate with your software so taking a little time to research their capabilities can save you some manual data entry further down the line.
Using template invoices using Microsoft Excel or Word is commonplace but again, this has the problem of more unnecessary admin time behind it as well as the more manual work involved in typing the invoice data in, making sure you have the right invoice numbers and dates, etc. You are also placing a reliance on your customer being able to open the file if they don’t have the relevant software themselves.
You should also think about how you are going to supply your customer with the invoice. The ideal method is via email because it can be received within seconds, you have a record of exactly when it was sent and if the address used is incorrect then you’ll get a notification of the fact. Obviously with this faster delivery method, this should help with getting paid quicker too!
Having the payment methods clearly shown on your invoice will help your customer get their payment to you so this is key. Make sure you display the necessary bank details and be sure to specify the due date of the payment.
It is proven that offering card payments helps reduce debtor days so this should be considered as well, particularly if cash flow is important to you. Many cloud software providers now have these linked directly in to the invoices which means a customer has the convenience of going to a payment page at the click of a button. Of course, there are costs associated with such facilities so some careful research is recommended beforehand.