10 Business Invoicing Mistakes to Avoid
Everybody makes mistakes, from startup business owners to executives, from first-time parents to chess grandmasters. Mistakes are a great equalizer, in this way. However, not all mistakes are equal. Taking the wrong turn on the highway is a lost less dangerous than making mistakes with your company’s invoices. Learn these top 10 business invoicing mistakes to avoid:
- Assuming your client will pay without sending them an invoice.
Never do this! It’s your responsibility to remind your client to pay, as well as how and when, not your client’s responsibility to figure it out! Doing this is sure to cause you a headache when your client completely forgets to pay. - Sending your invoice without proofreading.
Don’t do this! You could end up with an embarrassing typo, bad math, or worse, the wrong amounts given! - Not stating a clear due date.
With so many clients already taking extended amounts of time to pay back invoices, one of the worst mistakes you can make is to exacerbate the problem by not giving a due date. - Failing to send an invoice as soon as work is complete.
The best way to encourage your clients not to pay on time, short of telling them, is to be lazy about sending out invoices yourself. If you can’t send out your invoices directly after work is done, you’re sending a strong message that prompt payment is not a priority for you. - Submitting the wrong invoice to the wrong client.
Especially if you’re sending invoices out to several clients at a time, mix-ups can tend to happen. The best-case scenario is that you end up having to wait even longer to receive payment. The worst-case scenario is that by sending one client’s invoice to another, you can end up in legal trouble for breaching private information. Be vigilant for mistakes like this, and make sure to double-check the address. - Forgetting to reiterate your terms to your client after the initial contract.
Another way to reinforce your desire to receive invoice payments as promptly as possible is to make sure to remind your client of your contract terms. - Neglecting to follow up on late payments.
“It will be fine,” you think to yourself, “I don’t want to be rude, they’ll pay soon.” Weeks go by, and your client still hasn’t paid. Don’t make this mistake! Late-paying clients are liable to continue holding off on payment unless you remind them how important it is to you to be paid promptly! - Not being open about all fees on your invoice.
A great way to lose a client’s trust is to bombard them with hidden fees on invoices. Even though you may do this unintentionally, simply having forgotten to tell them before making your invoice. Be careful to discuss all fees with the client, before you list them on your invoices. - Forgetting to keep a copy of all invoices sent.
If a dispute should arise, not having a copy of the invoice you sent out could spell a certain headache for you if your client has misplaced theirs. Save a copy of all invoices, just in case. - Not providing an itemized bill.
Not making sure your client knows exactly what they are paying you for is a good way to set an unprofessional tone. Make sure your clients pay on time by being professional, and listing all charges on your invoices.
All these mistakes could lead to or exacerbate slow cash flow due to long invoice payments. However, even if you have learned never to make these mistakes, your clients are not under your control, and long invoice payments may still be an unpleasant reality, causing your cash flow to dip and fluctuate unpredictably.
To bulk up and steady your cash flow so you can authoritatively apply your attentions to the things that count in your business, like meeting your goals and moving forward, start factoring your invoices with Factor Finders! Receive up to 90% cash back immediately after selling your invoices to a factor, and get back the remainder, minus a small fee, as soon as your clients pay.
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