When running a small or freelance business, especially for the first time, it is imperative you learn how to properly prepare an invoice. Being able to manage your invoices lends an air of professionalism to your business and assures that you won’t get taken advantage of.
Here are a few tips to help you create and manage your invoices.
Keep it simple.
Your invoice should make a few facts very clear: who you are, how much they owe you, when that money is due and why they owe you this money. Be especially adamant about that last part. If a problem should come up, you and your customer should be able to refer back to the original invoice to what you did for your client.
Send professional invoices
Sending your client a professional invoice communicates that you, yourself, are a professional. You are conveying that you take your work seriously and you expect to be paid for it. Use an online invoicing service, Microsoft Word or a Microsoft Excel spreadsheet to create your invoices.
If using Word or Excel, remember to use a 12 point serif font and always show your math work, in case you make a calculating error. If you feel so inclined, you can go so far as to create a professional looking logo for your business to place in the letterhead of your invoice.
Set payment terms early on
During contract negotiations, be specific and clear about when you require payment, and use standard terms. For example, “net 30” means your client pays the invoice within 30 days of having received it. Consider offering different forms of payment, such as Paypal, Google Wallet or check mail order.
Set a late fee and specify it on every invoice
Establish a percentage of your order to be charged for every x amount of days the payment is late, and stick to this. Setting payment terms like this ensures you won’t get taken advantage of. Placing these terms on your invoice ensures that the information will be relayed to the person in charge of payment, as that is often a different person than the person who signed your freelance agreement.
Maintain a level of professionalism when interacting with customers
Especially regarding payment issues. it may be tempting to hound customers who don’t seem to pay on time. But oftentimes, frequent phone calls and emails will have an adverse effect, and drive those who owe you money even further away. Maintain your professional voice when reaching out to customers who don’t pay on time. Use email, not phone calls, to remind clients that they still owe payments.
Be professional and keep your invoices simple, sticking to the mandatory information: who you are, what you’re owed, when that money is due and why they owe you that money. Establish your payment terms early on, and always stick to those terms. Write any stipulations, such as any rules regarding late fees, on the invoice, so that your customer will always have access to that information. Don’t hound customers about late payments, but instead, email them regularly to remind them. Never continue working with a customer who doesn’t pay you on time the first time.