Your Growth Partner 04/04/2017
As a business owner, you generate income from the goods or services that you sell to your customers. To bill your customers, you send them an invoice. Unless you require the customer to pay beforehand, an invoice is typically sent after the item is shipped or the service is performed. A clear invoicing policy and procedure helps simplify the process.
When a client orders goods or services, they make a purchase order. Regardless of the order method or size, you should have a paper trail that reflects the order. The purchase order should show buyer’s contact data, the billing address, item number, quantity, description, and total price. It should also be signed and dated by the buyer. If there are issues such as incorrect price or shipping address, contact the buyer for clarification before processing the order. Make the necessary adjustments, sign off on the order and send the buyer a copy.
Confirm that the buyer received the order by checking shipment tracking numbers and signed paperwork that shows delivery. If you performed a physical service for the customer, send a receipt after the service is performed. Paperwork that proves you shipped the item or provided the service can be a great tool against liability.
Creating an invoice template can be very helpful, and make the process easier. Most accounting software’s offer one. The invoice should clearly show the related purchase order number, invoice date, due date, and total due. Also, include a section for the customer to put their payment method, such as debit or credit card, check or money order. Depending on your preference, the customer can return the invoice to you with their payment, or they can simply reference the invoice number when sending in their payment.
Create a late payment policy and send it to your customers so they know the consequences of delayed payment or nonpayment. Most businesses give the customer a grace period rather than exercising harshness if payment is only a day late. Establish stages that show what will happen when late payments hit a certain time frame. Include applicable late payment fees and charges for returned checks and declined credit card payments. This way everything is made clear from the start, and there should be no question about due dates.
At WSC Business Solutions, we can assist your company by setting up invoices in one of our accounting software we provide. We will insure that these invoices are clear, and that your clients are paying on time. This will increase cash flow, and simplify your business processes so you can focus on growing the front line of your business. Contact WSC today!
Stay Focused. Grow Confidently.
Written By: Lindsey Baird | WSC Business Solutions