Invoices are an important part of any business. They help you get paid in a timely manner, keep track of your accounts, and when done right, help build long-term, trusting relationships with your clients.
This invoice template guide will discuss everything you need to know about invoicing, and why it’s important to get it right.
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Your business name is one of the most important elements of an official invoice template. It shows who you are and establishes your brand. Include your company logo for an extra professional touch. The Invoice2go app helps you create a simple logo if you don’t have one already.
Adding seller contact information lets your clients know how to contact you if they have any questions about the invoice It also allows them to contact you for future work.
To stay organized and make the tracking easier for tax season, it’s best to provide a unique and sequential invoice number for every invoice you send.
There are three main types of payments terms small businesses use. These invoice payment terms depend on common practices of your industry, your relationship with the client, and your cash flow needs. For example, “Net 30” means that the invoice is due 30 days after the Invoice Date. Be mindful that some businesses may pay later than the stated due date, so you may want to account for a little extra time to avoid a cash flow gap.
The Invoice Date plus Payment Term Days give you the Due Date, which should be in plain English and easy to understand. Having a due date on the invoice is a tactful and professional way of making it clear to your client when they should pay. Setting up payment reminders can also help keep your customers on schedule to pay.
Who this invoice is intended for and their contact information.
Specify Description, Quantity, Rate, Amount and Subtotal. The more details you include on the invoice, the better. This way, your client will know exactly what they are paying for upon receiving the invoice.
Depending on your jurisdiction and type of business, the tax requirement can vary.Refer to your local tax bureau and include the appropriate tax amount on the invoice. Pro tip: Use an invoicing app to manage your business activities, change tax settings as need be and make your tax time easier.
If you are offering a discount to a valued client, include the number here. This can be a percentage or actual amount.
A simple, personalized note will leave a good impression with the client and increase the chance of an invoice getting paid faster. You can also include payment instructions, warranty information, discount details or anything else relevant to the job.
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Now your invoice is on its way. Stay on top of your overall business by using Invoice2go to collect and keep track of your payments.
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If you’re still creating invoices manually, consider ditching the carbon copy notepads and trying online invoicing software. Most clients prefer electronic invoices. They’re automatically in a format that is professional, easy to read, and easy to pay.
Send your invoices out as quickly as possible, while your services are still fresh in your client’s mind. The quicker you send the invoice, the quicker you get paid.
Your client wants to know exactly where their money is going, and your invoice should communicate the nitty gritty details of the job. Be specific rather than general with your line items. Instead of listing “materials” as a single expense, itemize each one on its own line, such as: paint, nails, plywood, etc. It’s also a good idea to attach receipts to back your claims. Don’t risk having your client wonder if you’re padding the bill.
Offer your clients as many ways to pay as possible. You can drastically increase how quickly you get paid by accepting digital forms of payment like PayPal, debit, or credit. You only pay a small % fee for the assurance the money is on the way.
Don’t be shy to tighten up the usual 30-day terms to something more like 14 days. Some clients will wait until the last possible moment to pay an invoice. Just be sure to communicate your payment terms in person, and on the invoice itself.
By using a tool like Invoice2go, you can set up automatic payment reminders to land in your client’s inbox on the days you specify (i.e. on the due date, three days before the invoice is due, etc.) A friendly nudge can go a long way to getting you paid on time.
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Online invoicing can bring a number of real benefits to your business. Here are the key differences between paper invoicing and online invoicing:
|Paper invoice||Online invoice|
|Average days to payment||23 days||16 days|
(3 days on average if accepting digital payments)
|Cost||Invoice2go plans start as low as $4.99/month|
|Delivery time||1-3 business days or longer, as determined by your mail carrier||Immediate|
|Invoice status tracking||No||Yes|
|Automatic payment reminders||No||Yes|
|Data storage||File cabinet||Always backed up to the cloud, accessible from any device|
|Mobility & flexibility||Low – invoicing typically done back at the office||High – send invoices and access your information from anywhere|
|Environmental impact||High – trees used for paper, and carbon emissions from postage||Low|