Keeping track of payments and invoices can seem like a herculean task when you have piles of paperwork and a list of missed payments. If you are looking forward to manage invoice payments easily, then you are at the right place.
However, with digital transformation on an all-time high, investing in online invoice software can help you achieve peak productivity and make your business processes super convenient. This post will lay down the best ways you can keep track of your invoices and payments.
1. Invest in a Good Accounting Software
The first step you need to track business expenses accurately is to eliminate manual tasks related to accounting and invoicing. With paper-based methods, you can end up misplacing papers and then end up in a brawl with vendors and clients too.
Luckily, online invoice software will help you set up an organized system and keep your invoices and receipts in one place. This will cut down on processing times and put an end to mismanagement caused by manual methods.
2. Follow The Best Invoicing Practices
An online payment software gives you access to free templates for generating the best of invoices. This is particularly useful if you need to create multiple invoices and send out payment reminders for late payments.
While invoicing solutions solve issues to a great extent, you must double-check and add information in the tool. While this may not seem like a big deal, it can become a huge issue if your invoice is not paid.
Make sure you add the following details in your invoice to get paid on time:
A. Add A Detailed Description
Strictly avoid writing “ as discussed’ as it can lead to ambiguity. Make sure you add details like purchase order names and a list of services or products. Be super-specific. Your invoice should be self-explanatory so that even if your client looks at it after a year, they need not ask for clarifications.
B. Triple Check The Due Date
Often online payment software will determine a due date for your payment. If you are ok with that, then you can send the invoice. Else, don’t forget to adjust it, else you will need to bear the brunt of late payments and hamper your cash flow.
C. Add The Right Contact Details
We understand that you may have been using your online invoicing solution for a long time now. But, there are chances you or your client moved places and changed their contact details. Make sure you check and update them from time to time. Having all the details laid out clearly will help you clear your payments faster and eliminate all confusion.
3. Mark Late Payment Settlers Carefully
Your online invoice software can easily identify clients that regularly falter on payments. You can use them to send payment reminders or use them as a hint to make calls to your clients.
The first thing you can do is to make a polite phone call. A follow-up email with invoice copy works fine if they cannot be reached. Your clients will appreciate the fact that they don’t have to look high and low for the invoice copy. Besides, they can check all the details and pass on the same to the accounting department.
4. Run Reports Regularly
Now that you know how to use online payment software, make sure you regularly run reports and keep track of your profits and losses. Let’s say your company earns $190K in a month and enter your expenses in your online invoice software. Also, your expenses are around $110k. So, when you run a profit loss report on the same, your net profit comes to $80k. Now, you can decide if you are happy with the figure or want to cut down on your expenses to increase this figure.
5. Determine Future Financial Plans
Once you have been using online payment software for a while, you will observe patterns. There will be some expenses that will be unusually high and some invoices that are always paid late. Please take note of them and record this information.
You can use these insights to create a good future financial strategy and see if you can cut down expenses or do things differently. Besides, you can consider changing payment terms for late payers with your online payment software.
These were a few ways you can keep track of your payments and invoice with ease. Using these tips can leave you with ample free time, and you can use them to solve core business issues. So, invest in good online invoice software today!