Invoices are the cornerstone of the success of any business. In this blog post, we outline five tips to help small business owners take their invoice management —and their cash flow — to the next level.
1. Include All the Necessary Details
Accurate, comprehensive details for all your clients go a long way toward ensuring smooth invoice management. To begin improving your invoicing process, make sure all your invoices include the following information:
- Name and contact details of your business
- Client Name
- Client’s contact information
- Invoice number
- Payment Terms
- Summary of the services or the products that you’re invoicing
- Due date of the invoice
- Total amount owed
2. Give Your Invoices a Recognizable Look
As you probably have experienced yourself, business owners have to deal with tens, if not hundreds, of invoices from different companies every day. Giving your invoices a generic look may create confusion and unwelcome payment delays. To avoid this, give your invoices a recognizable appearance that your clients can identify instantly.
3. Automate the Process
Automating your invoicing comes with many benefits: it reduces human error, allows you to gather data and identify trends, and saves you time by taking care of some of the most repetitive parts of the process. If as a small business owner, the shift from manual to digital processes feels daunting, keep in mind that the benefits of automation vastly outweigh the challenges. Plus, software solutions are becoming increasingly user-friendly.
4. Time Your Invoices With Your Cash Flow in Mind
In a previous post, we talked about the importance of cash flow, that is, the amount of money moving in and out of your business. Maintaining positive cash flow is crucial to any company; that’s why you have to time your invoices with an eye to your cash flow. For example, when you take on large projects, it’s advisable to ask your clients to pay you in monthly installments instead of all at once when the project ends. This way you ensure that money keeps flowing into your business at regular intervals.
5. Factor Your Receivables
No matter how much they plan in advance, even the most cautious businesses can experience a cash shortage. The causes are varied. Maybe the invoicing for a large project wasn’t properly planned, as in the example above. Or perhaps they have clients who are reliable but slow to pay.
At the end of the day, the result is the same: a lack of cash that may prevent you from meeting some important obligations such as insurance, repairs, or payments on debt.
Luckily, you can always factor your unpaid invoices. Factoring means selling your receivables to a company (called Factor) that pays you upfront and then takes care of the collection process in exchange for a small fee. This is a smart way to manage your invoices, reduce the administrative burden on your staff, and ensure that your cash flow stays positive.
ACS Factors: We Turn Your Invoices Into Immediate Cash
At ACS Factors, our mission is to help you get the capital you need to move your business forward.
We are located in Upland, California, and have many clients nationwide in the distribution and logistics corridor which includes Ontario, Riverside, Fontana, Jurupa Valley, and Moreno Valley.
Reach out today by email (firstname.lastname@example.org) telephone (909-946-5599), or through our social media accounts on Facebook, Twitter, and YouTube, and start converting your accounts receivable into cash today!