Common invoice mistakes can drastically slow down how quickly you get paid.
We set out below the key mistakes businesses make so that you can try to eliminate them from your processes.
Failure To Raise An Invoice Promptly
Leaving invoicing to month end is a bad habit. If the work is done and the invoice can be raised, you should do so. The sooner you raise it, the sooner you should get paid. Raising an invoice whilst it is in the customer’s mind, rather than weeks down the line, also makes it more likely the customer will pay it. Whilst fresh, the value will remain clear and present, but as time that will diminsh. Strike whilst the iron is hot.
Failing To Address The Invoice To The Correct Entity
Sloppy onboarding and invoicing can create confusion and uncertainty.
You should be absolutely certain from the outset, who your client or customer is. For example, Joe Bloggs Plumbing is a trading name of a legal entity. If you have to sue a client or customer over an unpaid invoice, you will need to specify the legal entity. For example, it could be Mr Joe Bloggs t/a Joe Bloggs Plumbing. It could be Joe Bloggs Plumbing Ltd t/a Joe Bloggs Plumbing.
You need to ensure your invoices are addressed specifically to the correct legal entity. Failure to do so creates confusion and uncertainty, giving a tricky client or customer an easy way so delay payment saying they need the invoice amending.
Failing To Send The Invoice To The Correct Contacts
You can speed things up by sending the invoice to the person that processes payments.
You might have been dealing with a particular individual at your client or customer business and will likely send the invoice to that person. However, do you know how quickly they will forward that on to the accounts team to attend payment? If you can obtain the relevant email address, copy in the accounts team when emailing an invoice to ensure it ends up in that department straight away.
Not Making It As Easy As Possible For Your Clients To Pay
As technology improves, you can make it easier for your clients to pay invoices. More banking allows you to send a link accompanying an invoice, for the customer to click on and make payment.
The easier you make the process, the more likely you are to receive payment quickly.
Sitting Back And Not Taking Action
You should have a clear system for diarising and pursuing invoices. The common invoices mistakes highlighted about can severely hinder your payment collections and get you off to a bad start.
The system you adopt should include taking swift and effective action. Our training courses give you all the tools you need to achieve that in house.
