8 Tips for Effective Invoice Management
This modern day has left many options to send invoices. This can be a benefit, but it can also be a disadvantage.
If your client isn’t used to using a specific invoicing system, this may affect your income. Or maybe your client has their own invoice management system you’re not used to.
So which invoicing system do you use to improve invoice management? You specifically want to look for an invoicing program that easily allows you to transfer funds that’s cheap and convenient to use.
So which programs help the process of invoice management? If you rely on invoices for payments, it’s best to be knowledgeable in several invoicing processes. Take a look at these 8 invoicing programs and methods.
This is the most basic part of the invoicing process. When compiling your invoice, have a checklist of the tasks you performed, the hours you worked, and if applicable, break down each of these points in term of compensation.
It’s helpful to include this information:
- Contact information (email, phone number, etc.)
- Address (if you receive physical checks)
- Tax ID (if you’re being paid through your business)
- Any information regarding individuals who handle billing
Try to be as thorough as you can. Report any breaks you took, include your exact rate of pay, and the days you worked.
It’s recommended you work on the checklist as you work, not in crunch-time right before your invoice needs to be submitted.
We live in an amazing world where everything is done conveniently without human assistance, and an improved invoice management system is included in this mix.
Accounting software is available which automatically integrates order and billing processes into reporting systems.
Your reporting procedure will improve and you won’t need as much assistance from an accountant. Since there’s no middle-man, automated invoicing speeds up the time you receive your payment.
And since this type of invoicing is done automatically on the same program, it will ultimately reduce the cost of invoicing procedures.
Look into integrated accounting software such as QuickBooks, if you haven’t. Automated invoicing can be done online or through a downloadable program, depending on your preference.
3. Electronic Invoicing
Most professionals are switching to electronic invoicing because of the convenience. However, there are more reasons to make the switch from a paper-to-electronic invoice management system.
The most important reason is improved security. Electronic invoices combat fraud by utilizing digital signatures and immediate transfer.
With electronic invoices, you avoid the step of printing and sending paper invoices.
You don’t have to wait to receive your invoice — some electronic invoicing programs allow you to receive compensation immediately. And the environmental professionals appreciate saving paper.
You even have options to pre-design your invoices and download reusable templates to expedite the process. With Billdu Invoice Maker, you can easily customize one of our professional invoice templates.
4. Online Payments
Online payments have become the preferred and most effective method of receiving money. And the reason why is simple: online payment systems are quick, easy to use, and you receive money immediately.
They link to your bank account for easy transfer. This type of transfer prevents checks sent by mail, so no significant amount of time passes between your payment being shipped and received.
Your account information is safe from your employer and also from hackers.
These systems use powerful encryption so there will be no issue accepting a large amount of compensation from your employer.
Common examples of online payment programs include PayPal, Venmo, and Stripe.
5. Other Types of Money Transfer
If you don’t wish to use an online payment program, there are other payment methods you can use that are just as convenient and fast. These payment methods are just as straightforward and easy to use as online payment systems.
This service uses an Automated Clearing House (ACH) to immediately transfer funds into the employee’s bank account. The company will require your account and routing number and may require a physical check from you.
Using the direct deposit method completely eliminates using physical checks.
Debit/Credit Card Merchant Account
This is when you give a debit or credit card to an employee and load their payment on the card. Just about all major card carriers have this service available.
The fees are low for the employer, which makes these cards a convenient option.
Believe it or not, businesses still hand out physical checks in 2017. This is often the least-approved way — you have to go to your bank and deposit the check, and other issues regarding security and shipping issues could occur.
But generally, paper checks have been the tried and true way to pay employees.
You can expedite the process by depositing the physical check into your account by taking a picture and uploading the picture into your bank’s app (if applicable).
Even though so many factors contribute to secure and effective payment transfer, monitoring is still the key to best invoice management system practices.
Get in the habit of regularly monitoring your invoice system. Make sure your invoice was sent out and that payment was received.
7. Establish Reminders
While you’re monitoring your invoices, you want to make sure your employer remembers to pay you. Send automatic payment reminders to your employer(s).
Send these reminders the day before. Make sure you use an automatic program — you may not remember to send them manually, which could result in a late payment.
8. Reduce the Amount of Accounts Receivable Days
To get you in the habit of monitoring your invoices and get your employer in the habit of sending your payment on time, reduce the number of accounts receivable days.
The accounts receivable days is the number of days between when your employer sends your payment and when you receive the payment.
A good rule of thumb is to receive a check every week to be sure you’re getting paid frequently.
Time to Improve Your Invoice Management System
It’s best to exercise invoice management as efficiently as possible. You want to receive your payment on-time and in the most convenient manner.
By exercising best practice when making and sending your invoice, you’ll be able to quickly receive payment.
If you need to find invoicing software, our technology helps businesses conveniently create invoices on the go and send them through the web and even on smartphones (we have iPhone invoice app, iPad invoice app and Android invoice app available).