Running a profitable business involves many challenges. One of those challenges is to create invoices, send them in time and prompt clients for late payments. Then there is the job of keeping track of payments and bookkeeping. If you think about the time it takes you to create an invoice; you might be slowing down your payment process.

If it takes you a day to compile data and another to create an invoice, your payment is two days late due to the long and tedious process of creating manual invoices. The accountant also has to cover expenses until the payment arrives and keep track of finances until the due date arrives.

his may not look so bad for one invoice every month, but if your company deals with multiple clients, you are losing precious time and resources only in billing your clients. The cost of manual or hand-written invoices increases with every invoice you create.

Thanks to technology, you can save time and money to make your billing procedure more efficient. A billing software takes care of your recurring invoices without putting you in the same drill every month. You can benefit from automation and see the difference in the time it takes to create and send multiple invoices.

Keep reading the guide to see how billing software has changed the way invoicing works:

Fast invoicing:

The best benefit of billing software is speed. A billing software helps you send invoices faster so your payment can be cleared sooner. There are options for scheduled invoicing which works with automation. Set a time and date for the invoices and the billing software will take care of the rest.

Direct invoicing is another perk of billing software. Choose the option to integrate accounting and billing software, and you don’t have to worry about the company accountant to send you the invoice. It helps in reducing your overhead costs.

Billing software technology now enables business owners to fetch data on any device through smart synchronization. You can send out invoices from your phone when you are in the office, sitting in a café or from an airplane!

Lesser mistakes:

As mentioned earlier, it only takes a few minutes to click and send the invoice. They are even faster if you automate them for recurring billing. The client can’t make the ‘lost in the mail’ excuses because you will be notified even when they click on the invoice and open it. The snail mail trauma is also out of the equation because it takes a few seconds to email the invoice to the customer.

Paper processing also produces mistakes in the invoice. The mistake of one digital cost you the whole invoice. You have to print the invoice again until there are no mistakes. If a wrong invoice is sent, the client will make fun of your proofreading skills. Billing software erases these mishaps, and you can edit and customize until the figures are spot-on. Online billing software will calculate prices for you, and you can be sure that the amount is calculated correctly. Mistakes need minutes to amend.

Build better relations:

Paper invoice requires several steps to process. Any process made through a billing software adds to your positive brand reinforcement. You can add customized messages and make the client feel like a VIP for doing business with you! It strengthens your relationship with the clients, and this positive image is displayed every time they talk about you to another potential customer.

Low costs:

Who does not want to save money? Say goodbye to the days where you were scourging around and finding the paper invoice that you lost somewhere in the books. A billing software takes care of your bookkeeping for a very low cost.

e-invoicing means that you don’t have to print out and sort any invoices. The software will take care of it. Moreover, digital invoicing is more environment-friendly than paper invoicing. It saves the trees! (you can be proud of this and market this)

you save water, energy and the trees from cutting down and producing paper. There will be less in the landfills because you didn’t print out the paper or use those horrible ink cartridges every month. Still, don’t believe us? Look at the paper calculator and calculate your carbon footprint.

Tracking invoices:

The job of an accountant is to prepare invoices, bill the client and then wait for the payment to arrive in the bank account. If the payment is late, you have to chase the client and then create a late invoice adding a late fee. Billing software that is integrated into your e-commerce platform can take care of this job on its own. It will notify the clients that payment is coming soon, land the invoice on time and then calculate late payment fees.

Tracking invoices become easy with billing software. You can view the status of payment on the dashboard. Overview is easy with these software. Multiple reminders can be created if you work with a lot of clients. The data collected on the software enables you to figure out the paying patterns of companies over time, and you can adjust your paying terms and conditions on the basis of this data.

The most important thing about billing software is that you can create a good backup archive and save it on the cloud. That way, a company or even the government can be shown a clean audit trail of your payment process if required.

If you are a small business owner, it is even more important to make audit trails and track invoices. You cannot lose money in creating invoices and printing them on paper. Software, on the other hand, reduces the costs and increase efficiency in your payment procedure.

Types of invoices:

Based on the type of business, the invoice can be tweaked to match the tone and need of the payment transaction. We looked at different types of online and offline invoice types. Here are some of the most common types of invoices:

Proposal: this invoice is created before the agreement is made, stating the fee for the product or services you will charge. It is like a pre-invoice or proposal.

Interim: a long-term project with the company does not mean that you bill them after months. Interim invoices are sent weekly or monthly to cover expenses until the final payment

Recurring: recurring customers can be billed by these invoices. The billing software saves the details of every customer, so you just have to pull the information out of the system

Past due: this is when the client has not paid, and you have to send a late surcharge. It includes the original invoice and the late fee

Final invoice: invoice sent out after a big project is completed by the company. It also rounds up the past interim invoices

Commercial: for international buyers or suppliers, the commercial invoice is required by customs to add taxes and another fee on the goods. Transportation and duty fee are added on such invoices

Consular: if the invoice has been visaed by the consular of the importing country, you need this consular invoice in the exporting country

Customs: it is an extended commercial invoice

Credit memo: rather than charging a customer, you send them a credit memo to prompt that you owe them money. You send the credit memo because the customer returned the goods, or you shipped the wrong item by mistake

When you have billing software that is integrated with accounting software, all you need is a good invoice template. Identify the type of invoice required by your business and then pull out the template from the software. Why should you rely on manual invoices when dozens of free templates are there for your service?

Benefits of a template:

Here are the key reasons why an invoice template is a lifesaver for businesses:

Looks very professional, leaving a solid impression on your clients

Clients who like your work will refer you to other potential clients

Professional invoice templates can be saved, whereas the paper invoices may land in the trash or get misplaced

Mobile apps of the billing software show you the template on the go

You can also prompt the clients and see invoice status anywhere through the app

Set up direct online payments and get paid directly through the invoice

All templates are print friendly in case you need a hard copy of the invoice

Each template is fully customizable

Professionally formatted invoice templates only need some customization to convert

Invoice template automatically calculates your total and sub-total amount

Essential elements of an invoice template:

Header: header is the defining feature of an invoice. It clearly distinguishes invoices from other documents

Logo: this is optional if you have a logo

Company details: company details contain your business name and other important details

Client’s contact details: client’s details are important as the invoice will be addressed to them

Invoice number: invoice number is the most important element of an invoice. It is unique for every invoice so you can save and search through the software any time

Date: goes without saying, the date is the second most important information for bookkeeping and archiving

Itemized details: this section carries the details of your products and services. You can mention quantity, or if you’re a freelancer then add the working hours for your service.

Terms and conditions: a lot of business owners overlook the terms and conditions. These are important lest you face some unforeseen circumstances.

How to edit an invoice template:

The invoice templates are very easy and simple to edit. We are going to highlight how to edit the elements of an invoice template.

Professional header: this will be the first editable component of your invoice template. You will write your business name or your own name if you are a freelancer, on top of the header section in clear and bold fonts. Website name also goes in the header.

Company details: You will enter the contact information in this section. Write the legal company name in the company details along with your address, phone number, etc.

Logo: if your company has a logo, upload it on the template in the logo section. Make sure your logo is professionally created with the dimensions required for this kind of template. Many templates have sizing options available.

Client information: after customizing the header and logo, you will mention the client details in this section. This information contains the recipient’s name, address, and phone number. Place this information clearly so the client can also distinguish it from other documents. The header is always placed opposite to the client information, so if the header is on the right, client info goes to the left.

If you do not have the mailing address of the person you are billing, then just enter their company name and email address.

Invoice number: invoice numbers are created as serial numbers for every invoice. Make sure you edit this important detail in your invoice. How you create, the number is up to you. Many people start from 00001 and go forwards. Others may identify different client invoices by adding a series of numbers like 021-00001 or the initials of the company XYZ-00001.

Date: Enter the date of billing this invoice. Billing software takes care of these little details so you can relax, but always proofread the invoice before you send it. Due dates are completely up to you. You can program the billing software if the due date is 30 days or 45 days. If you have a payment agreement with your client, you can tell them that they have to pay you by the 10th of every month. In any case, enter the due date in the billing software so it can be fed to the system for next time.

Payment details: under the due date, specify how you would like to be paid. If it is PayPal, add the details, or if it is your bank account, you can add that in the payment details.

Product details: an itemized breakdown of your products and services make it easy for you to ensure you are getting paid without forgetting anything. This section of the invoice should contain five columns based on:

Service: the description of the service you provided (SaaS businesses or article writing for freelancers) or the items that were purchased by the clients.

Date: the date when the purchase happened or the service was performed

Quantity: how many articles you wrote, how many hours you worked or how many products you sold to the client

Rate: hourly rate or rate per product

Subtotal: the total amount you will charge the customer for their purchase. Billing software will do this subtotal on its own, but you can always double-check.

Calculate the subtotal and don’t forget any sales tax, delivery fee or any other fee. The additional fee should be mentioned separately because some businesses have a separate budget to deal with these payments.

Terms and conditions: here you will mention the terms and conditions and any additional information that the client should know. Some examples of terms can be the return policy, due date and late fee terms, and discounts if any.

Always end your invoice with a polite and professional thank you.

Why should you invoice?

You want to show your customers that you are a good brand, right? In order to look more professional and secure more leads, your overall outlook should be branded to match your company theme. Not only does this show your customers that you are a brand, but it also helps you in figuring out how to become better.

If you are a clever business owner, the billing software will be like a blessing in disguise for you. Use the data from your current invoices and create data-driven marketing strategies. For example, if most of the sales are happening on a Saturday evening, it shows you that you can cater to the clients through email newsletters and social media posts. Billing software also shows you the most important items from your company and those who are not so much in demand.

Last word:

Invoicing gives you a modern outlook and prepares you for becoming a more thorough professional. This goes especially for the freelancers who have just stepped into the field and want to be in control since the beginning. When you have all your bases covered through the technology of automation and artificial intelligence, another party cannot violate your terms and conditions.

Think like a customer. Wouldn’t you like to carry an invoice as proof that you paid for the purchase? It is an important proof after all. Billing software come in all shapes and sizes. Choose the one that gives you more freedom to stay true to your brand and create the type of invoices you like. Editable templates make your job easy and boost the productivity of your team. If you have any tips about billing software, mention them in comments.