I’ve found that sending a solid invoice is like driving with your driver’s license. You really don’t think about it most of the time. But the one time you do get pulled over by a police officer you’ll be glad you have it.
So what goes into a solid invoice?
How can your invoices save you time and frustration?
Let’s cover four ways a solid invoicing strategy can make your life better.
Stop creating invoices manually
Using Microsoft Word for creating invoices requires a lot of steps:
- Duplicate your invoice template
- Plug in the relevant client and project information
- Double-check for accuracy
- Export as a PDF
- Create a new email
- Attach the PDF
- Write a note to your client
- Proofread the email
- Send the email
- Wait for payment
This is one of the least efficient ways to get paid.
Switching to an invoicing app will enable you to cut down on the number of steps required to create a new invoice. Cut down on the number of steps and you save time.
Smart business people find ways to remove friction and increase efficiency. Every minute you save drives your effective hourly rate up!
That’s right: You make more money in less time.
Sure, you can find pretty Microsoft Word invoice templates out there. In fact, I created some for freelancers who refuse to listen to my advice about invoicing apps! Even so, I recommend that you switch to an invoicing app immediately. The best ones integrate with Stripe and PayPal so that you can process payments online as well.
How long should creating and sending an invoice take you? Two minutes or less.
If you’re currently spending longer than that, you’re wasting your time and making less money than you could.
Send more invoices
I’ve met freelancers and small business owners who send one invoice per project—after they have completed the work. I think this is insane.
Cash is king, and inconsistent cash flow create a host of problems for your business.
Have you ever come up short while you were waiting on clients to pay you? Did you kick yourself for agreeing to start the project before you received a deposit?
Sending more invoices accomplishes several things at once. A deposit invoice sets realistic expectations with your clients: “My business is a for-profit business. You have to pay to play. If you want my attention, then you have to do what everyone else does and pay for it.”
A deposit invoice also minimizes the risk of a no-pay situation. I haven’t had many clients straight up stiff me, but I have had a few “cancel” projects and end the relationship in a self-serving manner. Because I already had the deposit, I didn’t lose money on the projects, only time.
Milestone invoices and payments can later train your clients to pay you more often. They will become accustomed to paying you at regular intervals, and you want to become a regular line item. This makes it less “painful” for them down the road when you pitch them on additional projects or services.
Smart business people find ways to minimize risk, and for clients and customers to pay you more often does exactly that.
You regulate your cash flow, and they remain invested.
Strive for simplicity
A lot of the invoicing apps out there are like Swiss Army knives. They boast a variety of features and tools, but they don’t perform any one task exceptionally well.
Simple Invoices delivers on the promise implicit in the name. The app is simple, easy to use. You won’t encounter a million things you have to configure. It was created to do one thing well: You can get in and out in sixty seconds, and that includes getting paid.
It's true, over 29% of our invoices get paid in less than a minute!
The app won’t automate your business or streamline your workflow or manage your projects or track your time or report your expenses or walk your dog. It sticks to one core function: creating invoices and getting you paid on time.
My primary frustration with other invoicing apps has always been the fact that I can’t click on a button and create an invoice. I must create a client first. I must add a contact. I must associate the contact with the client.
Extra steps. Blech. So irritating!
Smart business people look for simple tools. Why? Simple tools don’t break as easily and don’t make you pay for features you don’t need.
Have more than one way to get paid
Some people prefer to pay with PayPal, and some people will always use a credit card because they want the points.
Others like an automated bank draft. They’d rather not have to think about the invoice.
I also have clients who want to give me their credit card information so that I can pay myself on future invoices. Honestly, I love that. I do them a favor by not adding yet another task to their to-do list—“Pay Austin’s invoice”—and I get paid as soon as I create the invoice.
Regardless of what your clients prefer, when you onboard a new one, be sure that you have a backup plan.
Can you ask them to fill out a credit card authorization form just in case? (My CPA does that with all of his clients.) Can you save their credit card information in your invoicing app so that you can pay yourself in one or two clicks?
Believe it or not, invoice emails still fall through the cracks. When your invoice emails get sent to your client’s spam folder, your business suffers. Having an automated way to get paid will ensure that a client’s email servers or inattention don’t hurt your cash flow.
Smart business people want to get paid faster and more often while creating a better overall experience with fewer hassles for their clients.
At first glance invoices aren’t a likely candidate for innovation.
It’s just a request for payment, right?
Appearances can be deceiving. You can’t win at business if the way you request and receive money is slow and unreliable. You win at business if you get 1% better each day.
Take a closer look at how you create, structure, and send invoices, as well as how quickly you get paid.
You will discover opportunities to improve how you do business.