4 Invoicing Hacks You Should Be Using as a Small Business Owner
Invoicing properly is imperative when you’re operating a business. Invoicing is a bittersweet experience. It represents pay-day which is always good. However, I bet your clients aren’t jumping head over heels to pay their bills. That said invoicing can often be a time consuming and stressful interaction with clients. As a small business owner you want to focus your time on what matters most: growing your business. If you’re spending hours invoicing clients and chasing late-payments then you need to rethink your invoicing strategy. Here are four invoicing hacks that you can implement right away to streamline your billing.
Go Completely Paperless
This is one of the most important strategies you need to implement. If you’re still sending invoices by mail and waiting for paper checks you’re operating inefficiently. There are plenty of online payments solutions that offer a wide variety of accounting solutions like online invoicing, expense reporting, and even tax filing.
These platforms allow you to send, track, and pay invoices securely and from the cloud. I recommend choosing a platform that also offers mobile functionality so you can invoice on the go. The reason why this hack needs to come first is because the next four work best only if you utilize a digital billing solution.
Implement Discounts and Tips
Discounts and tips are a great way to incentivize early payments, acquire new business, and most of all increase your bottom line. When you invoice your clients it’s always a good idea to offer a very small discount for early payments. If your invoicing software gives you an easy option to do so I recommend offering a small 2-5% discount for an early payment. Additionally you can offer discounts like 10% off for first-time clients and 10-15% off for client referrals. The more you can sweeten the deal for your clients the more likely they’ll turn in to repeat customers.
If you work in a field where it’s common to receive tips then you should always leave that option in the invoice. When your clients pay their invoice they’ll much more likely to tip if you leave them a clear option before they complete payment. You should never expect that they’ll do so regardless.
If you only invoice a few clients at a time you can probably do this yourself but it’s always best to automate payment reminders whenever you can. If possible try and use invoicing software that allows you to easily set late-payment reminders to go out to your clients. You should also confirm that your client is receiving the emails in the first place. Mailbox software is getting better at distinguishing what falls under the category of SPAM and often times these automated emails make it into that category. Automated reminders serve as a stress free way of staying on top of clients and they also leave a paper trail should you need to involve any legal council.
Utilize Recurring Billing
If possible you should always try and encourage your clients to agree to a recurring invoicing schedule. Recurring invoices are a perfect way to create a consistent and reliable cash flow from your clients. If your client engagements tend to span over a few months you should ask your client if they’d like to agree to a bi-weekly invoicing schedule. As long as the terms and deliverables are agreeable then your client shouldn’t have an issue with recurring invoices.
When choosing your invoicing platform make sure you have the option to create recurring invoicing schedule and more importantly, securely store customer card information for future use. Automated payments lets your client setup their payment method to auto-bill on the desired recurring date. This is one of the best strategies to eliminate invoicing stress.
The right invoicing software can be your best friend. Modern payment tools offer extremely affordable ways to streamline your finances. Along with the right tools you should look to implement these invoicing hacks so you spend your time on what matters most!