Invoicing is time-consuming and can often feel tedious, but keeping your books in the black is critical to maintaining a smooth business operation. We’ve put together a list of 8 common invoicing mistakes to help you streamline the invoicing process and get paid faster.
Time Is Money
- Not sending the invoice promptly after the service is complete. Nothing tells a customer you don’t care about being paid more clearly than not sending their invoice soon after you’ve completed a service for them. They certainly aren’t going to go chasing you with a check in hand; it’s up to you to ask for it.
- Not clearly specifying when the payment is due. One of the most easily corrected invoicing mistakes! Similar to #1, if you don’t tell a customer when they need to pay you by, they’re likely to assume you don’t care when you’re paid. Be clear with your language, too; “net 30” or “upon receipt” may be confusing to people who aren’t in business themselves. Specifying a specific payment date is the easiest way to make sure the client knows when they need to pay by.
- Not sending the invoice to the correct person or department. “It got lost in the mail” may sound like an excuse, but if you don’t know for sure that you sent the invoice to the right person, it may just be true. Before you send an invoice, have the client tell you where and who to address it to, so there’s no confusion about where your invoices end up.
- Not making it easy to pay. Most consumers these days prefer to pay their bills online, so offering an online bill-pay system is a smart way to smooth the road between you and getting paid quickly. Linking to an online payment platform is an easy setup, and some website hosting companies even have a built-in payment tool. Offering pay-by-phone and having a list of ways to pay displayed prominently on your site are also good tactics.
The Devil’s In The Details
- Not itemizing services on the invoice. It should be crystal clear from looking at the invoice what the customer is paying for and how much it cost. Whether this is as simple as hourly rate times number of hours worked, or a lengthier list of parts and labor with different costs for each, being explicit about what’s being invoiced will lessen the likelihood that the client will think there’s been an invoicing mistake, and try to dispute it.
- Not restating the project terms on the invoice. Freelancers will be familiar with the term “scope creep”, which refers to clients asking for extra additions or revisions after the original terms of the project are fulfilled. Reminding the client what the original agreement was will make it clear that anything beyond those terms will incur an additional charge.
- Not proofreading the invoice for errors before sending. You’ve sent an invoice, only to realize you put the due date as August 2020 instead of August 2021. Or maybe you copied the invoice number down wrong, or made spelling mistakes. Upgrading to an online invoicing system is one way to clear up these little errors– that, or hire a really good proofreader.
And The #1 Invoicing Mistake…
- Adding surprise fees. Whether it’s an additional charge for work that extended beyond the original scope of the project, or a late fee due to sending multiple invoices, no one likes extra charges they weren’t prepared for. Any changes to the expected invoice amount should be discussed with the client beforehand. We recommend costs for late fees or extended project work be laid out in the initial project agreement, signed by both parties, before work begins. Bottom line, if the client hasn’t agreed to the fees, don’t add them.
More About Alacrity Collections’ Offered Services
Alacrity Collections is proud to be a leader in debt collections since 1982. Chasing overdue invoices is not an effective use of your time. Let our team help so you can work on running and growing your company. We achieve great results that are over twice the national average and treat all of our customers with dignity and respect. We work tirelessly to protect your brand and improve your net returns. To learn more about our services and get in touch, please call us at 1-800-752-9663 or email us at email@example.com.