Recurring Invoicing: Top 10 Mistakes to Avoid
Recurring invoicing is the process of charging customers at regular intervals against their usage of services. In this, the wholesaler or supplier can charge the customers automatically without undergoing the manual hassle. For recurring invoices, there is online invoicing software available in the market that businesses can start utilizing for getting an automated experience. Online invoicing software allows businesses to automate their invoice processes starting from handling incoming invoices to managing records of the invoice payments. The software will help businesses to focus on tasks other than invoicing. The online invoicing software will cover all your business needs. Where there are positive aspects of using online invoicing software it has its fair share of struggles and challenges as well. In this artifact, we will concentrate on the pitfalls that companies usually commit and they must avoid them while dealing with recurring invoices.
1. Wrongly Sent Invoices
If businesses have no proper set up in place for sending out invoices, they will end up sending the invoices to the wrong person or department. Because of the accounts payable processes, they will only end up getting their payment delayed. Ensure that the details on the invoices are accurate. If you are not sure, send an email to your client to cross verify the address before creating and sending out your invoices.
2. Ambiguous Pricing Strategies
If companies have not made their pricing clear to their customers, then their customers will be having some foul surprises when they receive their invoice. This can lead them to challenge, delaying, or refusing to pay for their invoices. For bigger companies, your invoice can also get lost in the accounts payable processes, which are set up to avoid fraudulent payments. In order to avoid having your invoice labeled fraudulent, make your pricing strategies pretty clear before you get into any business.
3. Precise Terms and Conditions
Companies must, first of all, come up with the Terms and Conditions in place that spell out all the late fees, pricing, and other details about their products and services. The companies must need to have these policies clearly stated on the invoice so that a client can have their questions answered right on their particular invoice.
4. Impolite Verbal Usage
Sometimes the companies forget to go for a second check when they send invoices, as they follow the same verbiage and pattern. So if there was any impolite expression used earlier, there are chances that it will keep on repeating and this is one of those mistakes that go unchecked at the business or company’s end.
5. Not Following Up
Late payments are a major annoyance for any business, as it can take a huge toll on your cash flow and make a mess of your accounting books. But how do you properly address the situation when it happens and prevent it from re-occurring? A customer may miss a payment for any number of reasons, from misplaced invoices to financial difficulties. A lot of times, though, a customer probably doesn’t realize they missed a payment so it’s crucial that you follow up with them.
Without a doubt lack of client follow up is the worst invoicing mistake, this happens either out of forgetfulness or fear of confrontation. Sometimes clients forget to pay. It happens quite often by the big companies that they forget to keep a follow up of the customer’s invoices. In order to avoid this, be sure to follow up with your business clients who are already late on a payment. Point to be noted is if you have made certain policies on paying late, your client will also be aware of late fees in that case, moreover you a friendly reminder email can also be sent to them to help them avoid that late fee.
6. Errors and Omissions
Nothing looks more unprofessional than an invoice filled with errors either big or small. Whether it’s a mistake in the charges, a misspelled name, or an incorrect invoice number, invoice errors of any kind reduce your authority and can undermine the level of trust that your customers have in your business.
Mistakes like this happen, but that does not mean that they should. Avoid any mistakes by always taking extra time to proofread your invoices before sending them, or switch to an automated billing system to protect brand credibility
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7. Late Invoices
The late invoices the late payment. Many clients that you are sending invoices to have multiple people signing off on invoices before they will pay them. Sending out the invoices late means that you are essentially going to get the payment process late.
8. Uneven Invoices
Many businesses and new startups make this mistake while dealing with recurring payments are that they do not invoice regularly. Instead of setting aside the first week for creating and sending out invoices, they do it as per their free time. More often, they tend to forget about it and have their invoices backed up for months in the end. This clearly gives a negative impact on the overall cash flow.
9. Unclear Items
One of the usual mistakes committed by companies is they forget to maintain the sync between the line items scribbled on a particular invoice. However, it is important for the customers to know what they have paid for so that they can also keep a track of their expenditures.
10. Billing Errors
The last notable mistake done by the companies is the negligence while billing or doing billing manually while dealing with recurring invoices. Billing is the most critical department in any business. Even a slight error/mistake can cost you much.
SubscriptionFlow is proud to be considered as one of the best online invoicing software. It allows you to manage your invoices seamlessly with an intuitive dashboard and user-friendly interface. Our team works all day long to provide our clients with the best of the services. You can get connected with us today via email! Our team would be happy to assist you out.
