For any business large or small cash flow is the lifeblood that keeps your business running, and properly managing invoices is key to keeping the cash flowing. As a small business owner, managing invoices might be one of those dreaded but necessary tasks. Here are a few tips on managing your invoices you might appreciate.
Send Invoices Promptly
Once your company has completed a service for a customer or a good has been shipped be sure that your invoice follows immediately. This will help you stay on top of your business, and will help to make sure for the recent transaction stays fresh in your customers’ mind. Additionally, make sure you include all of the details necessary for your customer to make the payment. If your company has mobile payment availability, let the customer pay on the spot and also include the link for online payment on your invoice for added customer convenience.
Automate the Process
Review your invoicing process and identify all the manual steps. These are places that can slow down your ability to send out invoices – and therefore slow down your ability to collect payment for them. Then look at the most painful ones. Can you use your current system to better automate these? If not, how can you leverage technology to help streamline the process?
If an invoice has not been paid by the date due be sure to send friendly reminders to your customers about the overdue payment. You’ll need a good collections process in place – along with people who are able to comfortably follow-up. Assigning the people who did the work to the collections process isn’t always a great idea. Someone with more emotional distance from the relationship might be a better choice to keep the process moving along.
In an ideal world, all the documentation you need to support each invoice is stored in a way that’s easy to access if your customer or client has a question. If it’s not, consider either attaching the supporting documents to the invoice record in your accounting system, or establish a standard electronic filing method that allows you to easily locate those documents if needed.