When it comes to asking clients for payment, sending an invoice is an important step that you need to fulfill. As a business owner, there’s no doubt that you are aware of and understand the significance of invoicing. However, there are some instances where you tend to make mistakes that can potentially lead to payment delays or even non-payment. Invoicing mistakes happen — it’s natural. But it still stings whenever they do. Fortunately, there’s always a solution.
One way to prevent invoicing mistakes is downloading and filling out a free invoice template from your preferred invoicing platform. When you use an invoice template, the number of errors during invoicing will drastically decrease. If you’re tight on the budget and in need of some steady cash flow, committing mistakes on your invoices is the last thing you want to happen.
To help resolve that, here are 13 common invoicing mistakes and how to avoid them:
1. Not Sending Your Invoice On Time
The worst thing you can do is delay sending your invoice. As soon as the service or product has been provided, send the invoice. This will help ensure that there are no delays in getting paid.
2. Incorrect Billing Address
Double-check your billing address before sending out the invoice. The last thing you want is for the client not to find the invoice or get lost in the mail.
3. Invoice Not Signed and Dated
Sending an unsigned invoicing is like sending a blank one — you’re telling your client that there’s no accountability for what was delivered. Make sure to sign not only your name as the business owner but also date it properly so that there’s a timestamp on when the invoice was sent.
4. Incomplete or Incorrect Itemization
When creating an invoice, make sure to list down all the products and/or services that were rendered with their corresponding prices. This will help avoid any confusion from the client’s end and expedite the payment process.
5. Not Including Terms and Conditions
Some business owners forget to include their terms and conditions on the invoice. This can potentially lead to disputes in the future if not clarified from the very beginning. Always have a section for your T&C’s so that there are no misunderstandings.
6. Not Charging Sales Tax (When Applicable)
This is a common mistake that happens from time to time. When you are required to charge sales tax, make sure that it is included on your invoice. Not doing so will leave room for error and confusion if the client had already paid a certain amount of taxes when receiving their order or service.
7. Invoice Is Not Detailed Enough
It’s no secret that some clients require detailed invoices. Make sure that your invoice has some detail to help them have an easier time approving the payment and sending it back to you right away.
8. Not Sending A Reminder Invoice/Email After 30 Days
After thirty days, send a reminder email or invoice just in case they forgot about paying their bills. If the invoice is still unpaid after another fifteen days, send a follow-up email.
9. Sending an Unprofessional Invoice
There’s no need for flowery language or too many graphics in your invoices. Keep it professional and concise — this is not the time to show off your creative writing skills (or lack thereof).
10. Not Following Up
So, you’ve sent your invoice, and three to four weeks have passed. Yet, your customer is yet to make payment. What do you do? In this case, a follow-up call or email is necessary to remind them about the invoice and prod them for payment.
11. Not Having Their Signed and Approved Proof of Delivery
It’s a good idea to have the proof of delivery (POD) already signed by your client when you send them out. This way, if there are any issues with an item delivered or service rendered, it can be easily solved as soon as possible — without wasting too much time on back-and-forth communications.
12. Not Charging Enough For Your Services or Products
It’s good to give your clients a discount from time to time, but you should never make it a habit. If the client is always asking for discounts and price reductions, this may be an indicator that they’re not satisfied with what was delivered. Before offering a discount, make sure you know what your services or products are worth.
13. Not Making It Easy to Pay
One of the reasons some customers tend to delay their payment is that the invoice is not easy to pay. Make sure that you have a payment gateway on your website or, at the very least, include all the pertinent information (e.g., bank account number, PayPal address, etc.) on the invoice itself.
14. Not Using ReliaBills Recurring Billing
Finally, we would like to include the significance of using an invoicing platform, specifically ReliaBills. It’s a fact that some customers will delay their payment, regardless of how perfect your invoicing process may be. This is where ReliaBills’ recurring billing feature comes in handy — it allows you to charge your clients automatically on a set schedule, so you don’t have to worry about chasing them down for payments.
With ReliaBills recurring billing, you won’t have to worry about invoicing your client every billing cycle and committing invoicing mistakes. You can set it up in a way that once your customer enters their billing details, the system will automatically charge and collect payment from that account. Now that’s effective and efficient billing that will improve your cash flow drastically.
At just $24.95 per month, you can subscribe to ReliaBills PLUS and get access to all the features you need to create a formidable recurring billing system. You can also cancel your subscription at any time so that you won’t have to worry about any commitments when you no longer want to use our services.
ReliaBills make sure that you are paid on time, every time. So go ahead and give our invoicing platform a try. You won’t regret it. Click here to learn more about our recurring billing feature. You can also jump ahead to creating your free ReliaBills account by clicking this link.
Keep an eye on these common invoicing mistakes and be vigilant in avoiding them. Doing so will help ensure a smooth payment process for both parties — which is the best way to guarantee steady cash flow. Remember, the key to successful invoicing is all in the details, so make sure that you include everything your clients need to pay on time.