Invoicing and collecting on your invoices are crucial to your company’s cash flow. As such an important aspect of your business, an efficient and accurate accounting system is necessary. You must be able to resolve small business invoicing issues quickly while enforcing customer terms for payment. A small business invoicing system that is streamlined and effective can minimize frustrations while maximizing your profitability. Here are a few simple keys to improving your small business invoicing process.
Resolving Invoice Issues Quickly
The first step to take in the journey to improving your small business invoicing is to make invoices a priority. Your customers must receive their invoices immediately. Regardless of how busy you are, you must make every effort to send them out ASAP. As your business grows, this may be a great responsibility to delegate to a team member.
Procrastinating with your invoices could send your customers the wrong signal – that you don’t take your relationship with them seriously. If you can procrastinate, why can’t they? Billing them promptly also gives both you and your customers more time to resolve invoicing issues immediately instead of waiting until the last minute. With any invoicing system, there is inevitably room for error. Whether due to miscommunication or misunderstanding, invoicing issues can create payment delays that affect other areas of your business.
Prompt invoicing allows you to address any possible issues with payment while the interaction is still fresh on your mind. This benefits both parties immensely.
Enforcing Customer Terms for Payment
There are several ways to guarantee that your customers pay in a timely manner. Make sure you have accurate contact information for the individual in the company who deals with accounts payable. If their account is delinquent, ask them if there’s anything you can do to ensure prompt payment in the future. Diplomacy is key when handling invoicing issues within a business.
Establishing rapport with your customer’s accounts payable department ensures that they understand both your invoicing process and terms for payment. Anything you can do to eliminate confusion or miscommunication goes a long way in improving your small business invoicing process.
Investing In An Automatic Accounts Receivable System
Companies that use technology typically excel in accounts receivable management. An automatic accounts receivables system allows you to easily track results as well as follow-up on payments.
Companies that have technologically-deficient accounts receivable systems can correct those shortcomings either with an enterprise resource planning (ERP) system or with a top-of-the-line receivables management application.
Many companies use ERP systems but fail to get the most out of them, while some of the world’s best companies use function-specific applications rather than an ERP system. Investing in an automatic accounts receivable system is one of the greatest steps you can take towards improving your small business invoicing.
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