9 Tips for Improving Your Invoicing and Billing Process

This post may contain affiliate links and I may receive a small commission if you make a purchase using these links – at no extra cost for you. Please read my disclaimer here.

Invoicing and billing is an essential part of any business. It’s how you keep the money coming in and drive your business forward.

However, this can be a time-consuming and tedious process. And even after creating and sending all of your invoices, there is no guarantee that you’re going to get paid on time.

In fact, you might find that you’re often left feeling awkward and frustrated as you chase up late payments.

And if you’re a small business owner, having the right payment processes in place is essential, especially for an e-commerce website.

However, when it comes to billing clients that aren’t user-end customers, late payments and outstanding invoices can have much larger implications for your future. But in any case, having to repeat this tiresome process month after month can be stressful.

Are you looking for a way to make this easier?

So, if you’re a business owner who wants to take the stress out of the billing process and get paid on time, you’ve come to the right place.

In order to make the end of each month feel much simpler and smoother, you need to improve your invoicing and billing process as much as possible, and we’re going to teach you how.

1. Set your terms early on

One of the most important ways to streamline your billing process is to clearly set out your terms before you agree to work with a customer or client.

Tips for Improving Your Invoicing and Billing Process

This way, you both know what to expect, and you can start your relationship off on the right foot. This also helps you to avoid any nasty surprises further down the line and increases your chances of getting paid on time.

So, you need to start by clearly setting out your prices or hourly rates, depending on whether you’re selling goods or services.

Next, let your customers or clients know when you will be invoicing them and how frequently; for example, will it be weekly, bi-weekly, monthly or quarterly?

It’s also a good idea to let them know how long they have to pay the invoice once it’s issued and any late fees or penalties they may incur if they don’t pay on time.

If you’re putting together an official contract with a customer or client, it’s best to write your terms into your contract and have them agree when they sign. It’s also important that your business sticks to the terms you’ve set out.

Otherwise, how can you expect the customer or client to pay on time?

2. Create detailed invoices

To avoid any confusion or delays in paying your invoice, it’s important that you create clear and detailed invoices. This means ensuring that all necessary information is clearly presented and easy to find.

It’s also a good idea to include any other information that you think might be useful to the customer or client. Some of the most important details you need to include are:

  • Dates
  • Invoice numbers
  • Tracking numbers
  • Unit prices
  • Quantities
  • Taxes
  • Relevant discounts
  • Total amounts
  • Your payment details
  • A call to action (more on this next)

And remember, if you’re billing for just one order or one part of a project, make sure that this is clear on the invoice, so they know there will be more to follow.

Essentially, the easier it is for your customer or client to understand your invoice and find the key details they need, the quicker they will be able to make the payment. There are many AP solutions on the market to help you with invoice automation which can boost your customer satisfaction.

This will also stop them from having to come back to you with queries or asking for additional information, delaying the payment even further. If you want to create an invoice easily and quickly, use the online invoice generator.

3. Write a call to action (CTA)

At the end of your invoice, it’s a good idea to add a call to action that reminds your customer or client how long they have to pay.

This might be something like ‘please settle the invoice within 14 days’ or ‘you have until {insert date} to make the payment’. Again, this will remind them that they are on a deadline and increase their chances of paying on time.

In tough times, you might find that some customers or clients are unable to make the payment on time or in full but are too embarrassed to admit this.

Therefore, it can also be beneficial to add a little note that says, ‘if you have any queries or you’re having a hard time paying your bill, please don’t hesitate to get in touch with our friendly team to work out a payment plan’.

Finally, you might want your CTA to point customers towards quicker and easier ways to settle their bills, such as PayPal or BAC

This can speed up the process and help you to get your money faster. Not to mention it can make their life much easier too.

4. Be sure to bill consistently

In order to make billing and invoicing less stressful, it's important to get a good system in place and to be consistent.

4. Be sure to bill consistently

It's also a good idea to make billing and invoicing a priority within your business functions, as knowing how to handle the process efficiently can increase reliability and reputation. 

This can help you to build better relationships with customers or clients. It will also help you to stick to the terms you set out with them at the beginning, as we discussed earlier.

Therefore, it's a good idea to send out your invoices on the same day every month

This could be a set date (such as the 25th) or the last working day of the month. Whatever you choose, this will help both of you to stay consistent and ensure payments are made on time.

5. Follow up and send out reminders

It's not enough to simply send out an invoice and then sit back and wait for the payment to be made.

You need to be proactive, especially if a payment is approaching the deadline. If you simply leave it in the customer or client's hands and then begin sending out late fees, it's likely that they'll get fed up and look elsewhere in the future.

So as the payment deadline approaches, it's a good idea to send out reminders letting them know that the payment still needs to be made.

And you don't have to be rude or pester them; a polite little reminder can be just the push they need to settle the bill.

After all, everyone is busy, and it is entirely possible that it just slipped their mind or got lost in their inbox.

It's also important that you send a quick late notice once the deadline has passed and at this stage, gently remind them that penalties will apply if the bill is not paid soon.

If you're very proactive, you could ask customers or clients to agree to reminder emails at the beginning of your contract or partnership, asking them whether they'd like to opt-in for regular communications from you to help them stay on top of their payments.

Reminders and late notices might feel like a time-consuming and frustrating task on your part, but once you've got a template in place, these should be pretty straightforward to send.

You can also automate this process, but we'll look at this in more detail next.

6. Create a (paper) trail

Some clients will prefer that you give or send them a paper invoice at the end of the month. Granted, this is far less common nowadays, but it does still happen on occasion.

It is fine to submit a paper invoice to your customer or client, but it is also best to let them know that you will also be sending them a copy of the bill via email as well.

That way, should your paper invoice get lost, you have an online trail that proves definitively that you have sent the invoice over. This can be very helpful during disputes but also just for your records.

This is particularly true if you’re a small business that works with other small businesses, and it’s easy enough to just hand over a paper invoice to your supplier down the road.

But remember, it’s always best to have a traceable trail to fall back on. So don’t just rely on paper but also send an email where applicable as well.

7. Automate time-consuming tasks

So far, we’ve talked about billing and invoicing like it is a labor-intensive manual task, and it once was. However, it doesn’t have to be this way anymore.

7. Automate time-consuming tasks

In today’s digital world, even the smallest automation features can make your billing and invoicing process so much quicker and easier. They can also help you to save precious time, cut costs and can reduce the risk of an invoice error.

This can also make the process much simpler for your customers and clients as well.

Some of the simplest and most common ways you might wish to automate your processes include:

  • Setting up recurring billing schedules that will automatically charge recurring fees
  • Creating invoices based on tracked billable time
  • Automating email reminders and late notices
  • Generating and sending receipts when a payment has been received
  • Copying invoices over to your billing software or chosen folder

And these are just a few ways to save yourself time and effort. Depending on which accounting or project billing software you use, there are plenty of other tasks you can automate too. 

If you're interested in a powerful e-invoicing solution, check out Coupa's platform and book a demo to experience their efficient invoice automation firsthand and boost customer satisfaction.

Of course, if you’re used to doing everything manually, it might take you a while to get to grips with using these features and letting technology take control, but it will be worth it in the end.

8. Choose the right software

We’ve talked briefly about automating your processes, but this is not possible if you don’t have the right tools in place.

Although a simple Excel spreadsheet might have served you up until now, if you want to streamline your billing and invoicing process, then it’s time to evolve.

There are loads of great accounting softwares out there you can choose from, for example, Quickbooks or Xero. But in order to get the most from tools like these, you first need to choose the right one.

There are several steps you can take to help you find the ideal accounting software for your business. First, be sure to make a list of the processes you’re thinking about automating and then you can list the features you would need to do this.

Then you can start to do some research into the top providers until you find the accounting software that is going to best suit your business needs and that has all the features you need.

It’s also a good idea to choose a tool that can be integrated with any existing software you use so that you don’t have to start from scratch.

9. Centralise your billing and invoicing on the cloud

As well as looking for software with all the right features, it’s also beneficial to choose an online solution that will allow you to centralize all your billing and invoicing data and tasks.

9. Centralise your billing and invoicing on the cloud

Choosing a cloud-based solution gives you flexibility and accessibility from wherever you are.

Though you might be used to doing everything from one work device or from a shared workspace, unfortunately, this can be very limited.

Choosing a cloud-based system will give you a real-time overview of your current billing and invoice status, and these platforms also allow you to work remotely so you can stick to your invoicing schedule no matter where you are.

Not only this, but many cloud-based accounting solutions will give you one location for all your data, proposals, invoices and more.

By giving yourself more flexibility in this way, you will be able to streamline your billing and invoicing process and make it easier than ever before.

Are you ready to improve your billing and invoicing this year?

By clearly setting out your terms, creating detailed invoices and automating time-consuming tasks using the right tools, you can start to streamline these important accounting processes.

So, if you’re looking to make your billing and invoicing just that little bit simpler and quicker this year, then make the most of our tips and advice above

About the author 

Peter Keszegh

Most people write this part in the third person but I won't. You're at the right place if you want to start or grow your online business. When I'm not busy scaling up my own or other people' businesses, you'll find me trying out new things and discovering new places. Connect with me on Facebook, just let me know how I can help.

{"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}