Running an SMB can be a balancing act and it often takes some trial and error before certain things fall into place. Unfortunately this also applies to invoicing where any potential trial and error can quickly impact cash flow and seriously impede the efficiency of your business.
So when it comes to invoicing, the margin for error is minimal. One way to avoid flawed invoicing practices is to outsource to professionals who know what they’re doing. But this can be costly.
Here we weigh up the pros and cons of outsourcing certain elements of the invoice process to help you decide what is right for your business.
How does your invoice look?
If something looks like a bill and is asking a person for money, it is going to be treated like most other bills – unenthusiastically. A more client-friendly invoice can often make the difference in time taken to pay.
You invoice must be laid out very clearly, with the amount and ways to pay marked out in as simplistic a manner as possible. A fun design can help to discourage bill-association with your invoice. Companies like Master Proposal act as a platform for you to download ready-designed invoices at a fairly low price, or alternatively you can spend time on designing your own, in-house.
When designing an invoice take time canvassing others on the accessibility of the layout and look at the colours used. Blue is thought to generate feelings of trust (think: Facebook, Twitter to BT and Carphone Warehouse) and is a good, safe choice for invoice design and branding in general.
How are you going to distribute your invoice?
Many offices and people desire the option to go paper-free so often it is important to have an online system in place. Electronic document distributors Netsend have found that the use of online and cloud distribution methods often encourage clients to may more promptly due to the simplicity of online payments.
However, for those who wish to have a physical copy of their invoice it can be useful to maintain an element of flexibility. Payment problems often are the result of disgruntled customers, so if you can keep them happy in terms of payment methods that will almost always be to your advantage.
You may wish to outsource your invoicing needs to professional services that can take control of the situation – but often these services are aimed at larger companies with bigger budgets. In-house can work very well from the SME as long as it is managed vigorously and kept up to date, and by implementing certain online platforms such as PayPal.
Do you have a contingency plan?
If your client does not pay you on time you need to have some kind of action plan in place. Often, a polite phone call to remind somebody their invoice is a day or two overdue can be what it takes. However if you’re too busy, as most SME owners often are, outsourcing your client nudges can be very helpful.
Companies like Still Due offer a service in which they contact your late paying client and ask them to have the money with you by a certain time otherwise there debt will be published online. This may not sound entirely kind but if somebody hasn’t paid you this could be exactly the push in the right direction that they need rather than you having to spend hours on the phone chasing up payments.
Photo credit: Recrea HQ / Flickr
