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Small Business Billing – How to Make Invoicing Less Annoying

GoReminders Blog Author Brittany Vera Brittany Vera

Learn 6 strategies that can make invoicing less of a hassle and shorten the amount of time you wait for payment. 

For small business owners hustling to make the most of every waking moment, mistakes are part of the learning process. Mistakes are opportunities to grow, learn, and improve going forward. But one mistake small businesses can’t afford to make is with invoicing.

While we can’t promise that invoicing will ever be a business owner’s favorite task, in this article, we’ll examine why invoicing is a challenge for small businesses and present 6 solutions to make invoicing a less annoying experience.

Why Is Invoicing Such a Challenge?

Small business owners wear so many hats. Especially during the early phases, you’ve got one eye on sales and customer experience and the other on hiring and cashflow. You’d love to have a few more eyes at your disposal on any given day.

So although sitting down to begin the payment collection process should be a rewarding experience, there is just no time to bask in the glory. Invoicing becomes just another task that you don’t have time to do as carefully and with as much attention as you’d like.

Add to that the fact that larger businesses often take advantage of the little guy. According to Entrepreneur.com, every year, small businesses are crushed with $12 trillion in delayed invoice payments.

Let’s think about a small artisanal bread company that sells to a large grocery chain. That bread company sends an invoice to the grocery store expecting payment upon receipt. But that rarely happens. Instead, the larger company takes their sweet time paying the small business, who then has to scramble to bridge the cash-flow gap and find a way to still pay employees, vendors, and Uncle Sam.

What Would Improved Invoicing Mean for Your Business?

Send billing reminders to your clients about upcoming invoices with GoReminders.

Imagine what your small business could do if you received revenue immediately? You feeling like that’s unrealistic? No problem.

Instead, imagine what you could do if you cut collection time in half:

You could put that money back into your business to hire more resources in a more timely manner.
You’d save time and energy calling and emailing those delinquent customers and clients.

In fact, a study by Harvard and MIT recently revealed that by cutting the payment period from 30 days to 15 days, each dollar received in this accelerated manner essentially paid a dividend of 10 percent and helped firms:

  • Increase earnings
  • Hire more people
  • Pay employees more

But instead, those larger companies are holding onto the money they owe you and are funding their own growth and well being with your money.

There’s Got to Be a Better Way

And there is…

Waiting to be paid or letting invoices fall through the cracks while you’re trying to build your business can be simply devastating.

Just a few years ago, every invoice had to be processed through a litany of internal departments for approval. But today’s technology enables on demand information and instant payment transfer. So there is no reason any small business needs to put up with a 30, 60, or 90-day payment cycle.

6 Strategies to Drive Invoicing Efficiency for Small Businesses

GoReminders helps automate the billing process by sending automated text and email reminders.

Here are 6 invoicing strategies for small businesses. Adopt and implement them to make invoicing more efficient, less annoying, and – gasp! – maybe even a little rewarding.

Strategy #1: Be confident about the value of your product or service

The first step in driving efficiency with invoicing is knowing that you are offering a product or service that is valuable to your customers. 

You are good at what you do. You know it. Your employees know it. And your customers know it. So why do so many small business owners have a hard time asking for payment?

Whether it’s some inherent beliefs about money being a taboo topic or simply haven’t embraced your worth as a business owner, this is a common problem. It’s even got a name: seller’s guilt.

Guess what? You need to get over it, because seller’s guilt can crush your business. Remember that you are very likely saving your clients money. What you do makes a difference for them and/or their business. Invoicing with confidence communicates that you are well aware of this fact and might even reinforce the confidence of your customers in you as well.

Strategy #2: Establish clear terms

Gone are the days of waiting 30 days for payment or billing only in monthly increments. It is perfectly acceptable to request payment within 7 days, to bill upon completion of each and every project, or to require periodic partial payments over the life of longer projects.

Establish payment terms that work for your business up front, including late fees. 

Strategy #3: Keep it all organized

Whether you use client management software or a simple spreadsheet to track your time and work efforts, it’s always easier to invoice when you’ve been recording the details along the way. Trying to recreate the project or multiple small tasks from memory is never a good idea.

As you onboard a new client, gather as much information as you can including:

  • Name of decision maker
  • Business address
  • Contact information for billing purposes
  • Payment rate and terms

You don’t necessarily have to share all of these details in the invoice, but having them at the ready should the client question an invoice is extremely helpful.

Strategy #4: Stay on top of overdue invoices

You may have learned as a child that asking for money or even talking about money somehow demonstrates bad manners or is just altogether awkward. You’ve got to let that go if you’re going to be a successful business owner.

Many times, overdue payments are simply an oversight and your client needs and appreciates a reminder. Perhaps the invoice was buried in a busy day of email or forgotten. 

If you don’t have an accounting department yet, there are many options available to automate payment reminders so you can simply set it and forget it. 

Strategy #5: Make it easy for client to pay you

This might just be the most important part of the invoice! Be sure that you let the client know how to pay you and when you expect to be paid. 

If you prefer direct deposit, double check that your banking details are correct. If you’re asking for a paper check, be sure you clearly say so and include an address. 

Strategy #6: Use the invoice as an opportunity to ask for a testimonial

When you are sending an invoice to a customer or client, it’s an opportunity for you to reflect on the value you are providing to the client. Even if your invoices are automatically generated, set a reminder for yourself so you know when the invoice is sent. 

Take some time to think about the client and consider what the customer experience has been like for them. If you feel there is a way to improve the service or the relationship, now is a good time to take action. If you’ve been providing total excellence, reach out and ask for a testimonial.

GoReminders Message Blasts makes it easy to ask all or a few of your clients to give a testimonial.

 

 

 

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