When you start a company one of the things you will have to decide is what your Invoicing Policies will be. Confused? Yes you need policies for your invoicing. You must decide what your policy will be in the timeliness of you invoice – when will you invoice, immediately, weekly, monthly, etc. What will your terms be, payment due upon receipt of invoice, net 10 days – payment due within ten days of invoice date, net 30 days – payment due within 30 days of invoice date.
If your client is not given an invoice at the time of sale how will you get an invoice to your client? Will you email or snail mail your invoice, or will you do both. How will you determine who to contact to email an invoice to – will you send the invoice to the authorized person that made the purchase or to the accounting department of a company. What process will you have in place to ensure the invoice gets into the right hands? Getting the invoice authorized and to the department issuing the payment is paramount for you to get paid.
What will your policy be for late payment of an invoice? Will you charge a late payment fee or interest on outstanding balances? If a client is continually late on paying invoices will you secure a down payment before providing more products or services or will you give your clients a discount incentive to get them to pay sooner? How will you handle invoices that go unpaid for an extensive period of time?
When it comes to payment what types of payment options will you provide? Will you offer payment plans, credit card payments, cash only, will you accept cheques or electronic fund transfers. Will you offer credits or refunds on goods that your client wants to return or has issues with?
Creating policies before you Start Invoicing will give you a clear direction before a problem arises. Policies will be changed and adjusted as your business encounters new situations but having policies in place will help eliminate confusion and provide you with a starting point to guide you through the process of invoicing and receiving payments from you customers without undue delay.