One of the significant aims of every small business is to make money by selling items or providing services. An effective invoicing strategy is crucial to expediting this process. A complete, thorough invoice is vital in avoiding confusion or miscommunication between you and your client. These small company billing and invoicing ideas can assist you in sending out bills in a timely, effective, and accurate manner.
Use an Invoice Template
Several downloadable invoice templates are available online that you can customize to match the products or services you’re invoicing for. These can include a company logo, which helps build customer connection and brand recognition while making the invoice more professional-looking. It’s essential to list all the goods or services you are invoicing for on your invoice, along with the total amount owing. You should also note if a tax is included in the total, which will help your clients avoid confusion. Some small business owners add a section that details payment terms, which should be clearly stated to minimize the possibility of late payments. For example, you may want to state “Net 30 Days” or any other term that applies to your business. You should also provide a clear link for customers to make an online payment to get paid faster.
Include the Customer’s Contact Information
The customer’s contact information is a critical part of an invoice. This way, they can easily track their account and make payments promptly. Another critical aspect of an invoice is a clear statement about the payment terms. It should include the date when payment is due and a specific description of the products or services provided. It can help both parties avoid disputes and ensure clients know what they’re paying for with the right invoicing services. You should also include a note about any late fees that may apply. These should be identified and listed as a separate line item on the invoice and consistent with your terms and conditions and how you handle late fees for other products or services. Providing this information can reduce customers’ time to pay your invoices and prevent miscommunication or confusion about what they’re paying for.
Label Your Document as an Invoice
For the customer’s convenience, invoices should always be identified clearly as “invoices.” Some companies will also provide a document number unique to the invoice, making it easier to track each one and get them paid on time. Another important tip is to specify the terms of payment on your invoices. It will help clarify what needs to be paid and how it’s due and can even help you improve your cash flow. It’s also helpful to include a list of the payment methods you accept so that customers will know their payment options. Even better, you may provide a link on your invoice that customers can use to send you money immediately. Alternatively, allow them to enter their credit card details online and set up recurring monthly withdrawals from their accounts.
Include Your Business’s Legal Name
Unless your contract specifies otherwise, all invoices should be sent in your business’s legal name. Before pursuing this choice, you must register a DBA (doing business as) or fictitious business name form with your county if you intend to conduct business under a different name. Your business’s legal name is listed on the articles of incorporation or organization and is what you use to register your company with the state. Your legal name is the official name on all your business forms and documents, so it’s essential to include it on every invoice. You can also operate under a trade name you use in marketing and sales. A trade name is often a nickname for your business and can be used instead of your legal representation.
Include the Date You’re Preparing the Invoice
The invoice date should be the first thing your customer sees and prominently displayed. Including the invoice date on the front makes it easy for clients to track their payment due dates and may help prevent an overdue invoice. If you have agreed to supply or provide services on a set schedule, you should include those dates on your invoice so your client knows when to expect your work and payments. Including specific dates can also be helpful if your customer disputes a charge later. You should also clearly state your business’s payment terms on the invoice to ensure everything is clear. Including a penalty or late payment fee at the bottom of an invoice can also be helpful for additional peace of mind.
Add the Total Amount Due
Every paid invoice ensures cash flow and helps the company operate smoothly. However, if customers are late paying or question the invoice amount, it’s essential to remain professional and work with them calmly and collected. Beneath and to the right of each line item, you should include the total amount due for that particular product or service. If you’re charging sales tax, make sure to add this too.