How to Invoice Clients
How to Invoice a Client? 10 Steps to Get Paid on Time
For a healthy business, it is important to effectively bill customers and ensure fast payment. This applies to many industries, both large companies with international clients and independent contractors who simply bill for projects.
If you want to receive money faster, you need to create a high-quality billing system. This includes professional-looking invoices, reasonable payment deadlines, and clear communication with customers.
If you do not receive payment from the client within the prescribed period, you will have to contact him directly about the overdue payment and, if necessary, issue a fine for the delay.
How to Invoice Clients
Invoicing is an important part of accounting in small businesses, as it helps freelancers and entrepreneurs get money from their clients faster. Invoicing customers and tracking the accounting process can be intimidating if you’ve never done it before.
Follow these steps to professionally issue invoices to customers and receive payment on time:
Get to Know New Clients
When you enter into a business relationship with a new client, conduct research to verify its legitimacy. Visit their website to check their online presence, familiarize yourself with their business offers and view the employee directory.
With new clients, you can take an advance payment to make sure they are ready and able to pay you. Usually they charge from 10 to 50 percent as an advance, depending on your industry and the scope of the project – study how much other freelancers in your region charge.
Understand How Clients Want to Pay
To increase the likelihood of timely payment of bills, it is better to understand how your customers want to pay you. Be as flexible as possible, within reason.
Offer multiple payment methods, such as checks, PayPal, credit cards, and cash. Does a study of standard payment deadlines in your industry:
Is it standard practice to offer a 30-day payment window? Offer a payment schedule that matches other businesses like yours and guarantees you a fairly stable cash flow.
Set Your Payment Terms
After conducting the research, determine the payment terms. This includes the payment methods you accept and the payment deadlines for invoices.
Make sure that all payment terms are clearly indicated in your invoices. It is also useful to discuss payment terms with new customers in advance before sending them the first invoice.
Get to Know the Accounting Teams
If there are large companies on your client list, there is a high probability that your billing contact will be different from the contact for everyday work.
If your client has a team of accountants, get to know them and always be polite and friendly in communication. If you prove yourself positively, you will have a better chance of receiving timely payment of bills, and accounting staff are more likely to lend a helping hand in case of problems or errors.
Create Professional Invoices
The most important factor in getting timely payment from customers is sending clean, professional invoices. To do this, you can use free invoice templates such as FreshBooks, or pay a small amount to purchase time-saving cloud billing software.
Regardless of whether you will use an invoice template or your own design, be sure to provide all the necessary information about the account and business, including:
- Contact details of your company
- The name of your company (or other important data if you work as a freelancer)
- Contact details of your client, indicating the right person as the contact person
- Your company’s logo
- Your payment terms
- Your payment method (transfer to bank account, check, etc.)
- Invoice number and invoice date
- Detailed information about your services
- The total amount of the invoice to be paid, including any applicable taxes
Check out this complete invoicing guide to get more tips on creating professional invoices to send to customers.
Follow Proper Invoicing Etiquette
Always be polite and concise when sending and then checking invoices. Use clear wording in the cover letters when sending invoices: do not include vague instructions in them that the client may misinterpret. If a customer delays payment, do not react with anger. Instead, stay polite but firm in communication.
Establish an Invoice Filing System
Once you start sending out invoices, you will want to create an accounting system so that you can easily refer to invoices in the future.
You may want to create a folder for invoices sorted by year on your work computer, and then come up with a name for them that is convenient for you. Or you can use invoicing software and free invoice templates to simplify this process.
Follow up on Unpaid Invoices
If the customer has not paid you within the agreed time frame, do not hesitate to re-send a polite reminder that the payment must be made. If you have not received a response to your email, call the client and ask for more information about the account.
Chasing clients to get paid may be inconvenient, but it’s a necessary part of a freelancer’s life.
Charge Late Fees
Consider including in the payment terms a condition that you will charge penalties for late unpaid bills. If you decide to charge penalties for late payment of bills, remember the maximum amount of interest that you can charge in your state.
Thank Clients for Payment
When customers pay you on time, don’t forget to express your gratitude. Send a brief thank you note for the payment and let them know that you value their business. A little gratitude can serve as a guarantee of future business.
What Does It Mean to Invoice Someone?
If you run a small business, you need to receive payment from customers for your services. Billing customers allows you to bill them for your services.
Invoicing involves providing customers with a professional document describing the terms of payment, indicating the date of invoicing and the due date, as well as detailing your services and fees.
Invoicing allows you to keep records of the sale of your services both for your own accounting and for the accounting of your customers. Invoices are an important accounting tool that will help you track sales and understand how your business is developing.
What Are Invoices Used for?
Invoices are used to reflect sales transactions in accounting. The invoice acts as an invoice and lists all the services that the company provides to the client.
Small businesses use invoices as a way to receive payment. Invoices serve as a documentary confirmation of the services rendered and determine the payment terms that the client must follow.
Invoicing can be a difficult process for beginners. But fortunately, there are some great tools that will help you organize your bills, get paid faster and simplify the billing process. One of the best examples is FreshBooks: flexible billing software that saves you time and helps you get paid.
Thanks to countless professionally designed invoice templates and a set of programs that help you track payments, send automatic reminders that encourage customers to pay quickly, and much more, FreshBooks frees you from having to do what you love.
Conclusion
Getting a timely salary is of great importance for small businesses. This ensures a stable cash flow and allows business owners to have more freedom of action when making important financial decisions for their company.
However, unlike other forms of payment, invoicing may be accompanied by more uncertainty and inconsistency than you would like. That’s why it’s so important to familiarize yourself with the best billing practices, as well as use all the tools at your disposal.
With flexible and powerful billing software at hand, you will be able to send invoices more efficiently, track overdue payments more systematically, and get paid for your work faster. If you are looking for a great option, FreshBooks may suit you.
FAQs on How to Send an Invoice to A Client
Do you have any more questions about invoicing, invoice templates, or how to get paid faster? Here’s everything you need to know to easily process your own invoices.
Can I invoice someone without a contract?
While it’s always preferable to have a signed contract or other written agreement, you don’t have to have a contract to bill a customer. Although you can return the money owed without a contract, it is easier to make it just in case.
When should you invoice your client?
It is best to send the invoice immediately after your work has been transferred to the client. Although it may seem impolite to issue an invoice so quickly, it can help your client not forget to pay you, which will ensure you get paid as soon as possible.
Perhaps other schemes are more suitable for your industry, so discuss the options with the client in advance.
What should you not put on an invoice?
Do not include your handwriting in the invoice – it may look unprofessional or even lead to accounting errors. Also, do not include complicated legal jargon regarding payment terms, the wording should be simple and concise. Finally, do not make mistakes in the date, account number, payment method or customer information.
How do I invoice someone if I’m self-employed?
The billing process is very similar for self-employed people and businesses. The only significant difference is the information in the “from” section. Just provide your name (and the name of the company, if you have one), the address of the company (or home address) and the usual information about the invoice.
In addition, you can save time by using one of our free, professionally designed invoice templates for individual entrepreneurs.
How long after you invoice a client can you expect payment?
When creating an invoice, you must set the payment date, as well as any late fees. The standard is to provide 30 days for payment, although shorter or longer deadlines may be set in some industries. Try to give at least 14 days, unless otherwise discussed with the client and agreed with him.