4 Steps to Go from Invoice Fears to Invoice Cheers
Nothing feels better than getting paid for a job well done. Because freelancers, entrepreneurs and small business owners all rely on clients paying invoices on time to maintain a steady flow of income, it’s important to make sure your invoice process is smart, efficient and a source of stress relief. Instead of tracking down the people who aren’t paying on time, solve the problem before it happens by streamlining your invoicing process. Here are five tips to get better at invoicing.
Put Everything on Paper
You might have great relationships with clients—which is great! But even after those quick “handshake deals” over the phone, always send a quick confirmation email that details the new job in writing. This provides a record in case any problems arise. This doesn’t have to be super forma. After all you don’t want to lose the rapport you’ve just built. Try using a relaxed tone in the email, writing things like “just to make sure I know exactly what you want, below are the details of our new project.” This covers yourself in case of any trouble without hurting your established relationship.
Make it Easier on Yourself
Software can be your biggest enemy or your best friend. Good invoicing software allows the peace of mind that comes with tracking multiple clients and multiple projects within those client relationships. Before you settle on a particular software, try out a few first. You can use Due.com’s invoicing software for free to see how much you enjoy it.
Define Your Payment Policies
Keeping a steady form of income starts with having your payment structure and payment policies in place. To begin, you need to answer the following questions:
- What payment methods will I accept (cash, credit cards, checks, PayPal)?
- Should I require a down payment and how much should it be?
- Will I ever begin working without a down payment?
- Will I impose late fees? (After all – getting paid quickly is surprisingly crucial for business success.)
- Will the client receive the final project before or after final payment?
Once you answer these questions, write them down and save them to refer to later. It doesn’t have to be a formal document, just a guide for when clients have questions about the process. Always be clear with the client about your payment structure and policies.
Create a Service Schedule
As a beginning freelancer, it can be easy to create new pricing depending on the client, project type and project difficulty. Instead of you coming up with prices at the time of negotiation, sit down and determine specific (and consistent) prices for each of your services. Make sure to include the following:
- Base fee
- Additional fees for extra services
- Hourly rate for work completed outside of the initially agreed upon rate
- Rushed project fee
- Late fee
When creating your service schedule, make sure to incorporate the cost of any software or supplies you might need, any processing fees for credit card payments and other forms of overhead cost that could quickly cut into your payment.
Invoicing is the lifeblood of your financial support. Make sure to have the necessary foundation in place to ensure you’re always getting the payment when, where and how is best for you and your company.