Invoice best practice

FewFew

Hi,

Just looking on a few opinions in relation to invoicing.

I'm providing an on-going internet-based service for clients for a fixed monthly rate.

When is the regular time to send out invoices? After the work is done? When the work is commissioned? Some midway point?

At what point is it ok to inquire about the status of the payment? Should you wait 30 days when it's late, or is it ok to ask after a week or two?

Is there some sort of tradition/practice to send end of year invoices early (to get payment before year end or before Christmas?)

In terms of sending receipts, do companies expect them promptly or is it ok to send them along with the next invoice?


I just ask because I've a number of clients who are a bit sluggish to pay and the usual bills need to be paid. Pretty sure all of the clients intend to pay, but don't want to put any noses out of joint by politely inquiring.

TerryGorry

Fewcifur wrote: »

Hi,

Just looking on a few opinions in relation to invoicing.

I'm providing an on-going internet-based service for clients for a fixed monthly rate.

When is the regular time to send out invoices? After the work is done? When the work is commissioned? Some midway point?

Generally it would be done after the work is done. Your clients will expect to receive an invoice but they won't expect to be paying unless that is your agreement.

At what point is it ok to inquire about the status of the payment? Should you wait 30 days when it's late, or is it ok to ask after a week or two?

It depends on your terms of business..30 days would be a typical credit period but it is up to you to agree with your clients beforehand to avoid misunderstandings/bad feelings.

Is there some sort of tradition/practice to send end of year invoices early (to get payment before year end or before Christmas?)

There might be but generally business is business..if you supply me on the 15th December and I have 30 days credit as per our agreement then you are not getting paid until 15th January at the earliest.

In terms of sending receipts, do companies expect them promptly or is it ok to send them along with the next invoice?

I would expect a receipt when I pay but you can do this electronically and follow up with a hard copy in due course.
Terry

capefear

Hi

if you have agreed a monthly fixed fee with the client, could you get them to sign up on a monthly standing order for say the last day in the month and you can send them out an invoice after that date with a note on the invoice that is paid in full.

You can always add "payment to be made within 14/28/etc. days" to your invoice.

If you're providing an on-going service, that they're currently using/benefitting from, then don't go chasing them whilst still providing the service. If they miss the 'pay by' date, then get in touch immediately. If they say they'll get it out to you when they get a chance then stop the service until they pay up.

If you're seen as being soft, a lot of people will take advantage, in my opinion/experience (mind you, completely different line of work).


If "the cheque is in the post", tell them to cancel it, and you'll pop around and collect one (if it's feasible to do so). The cheque is rarely ever actually on it's way to you when people say it is.

(I'm assuming you're working with individuals or small businesses, though. If you're dealing with large companies that have been around years, then they probably have their own way of doing things so getting in touch and getting a date from then when you can expect to be paid is probably the more sensible option).

FewFew

Thanks guys. Finding the hardest part of all this stuff is the unwritten rules and common practices.

Had to bite the bullet and send a few friendly emails. Nobody seems to have been overly put out and most had just forgotten. In future I'll be more strict with documentation and such.

Cianos

Unless you need the cash, I wouldn't worry about it too much. If they require your services monthly then they won't go long without paying, for fear of those services ceasing to be provided.

It might be more hassle than it's worth worrying about it and chasing people up as well as risking souring the relationship, than just giving yourself a bit of a buffer out of recognition that paying you on time isn't always top of the priority list for your clients.

Obviously on the other hand if cash flow is an issue then there's more value there for you to put a bit of pressure on.

Peterdalkey

Fewcifur wrote: »

Thanks guys. Finding the hardest part of all this stuff is the unwritten rules and common practices.

Had to bite the bullet and send a few friendly emails. Nobody seems to have been overly put out and most had just forgotten. In future I'll be more strict with documentation and such.

Everybody is pushed for cash these days and the oldest adage in credit control / creditor payments is " those who don't ask, don't need!" . Bit like the front row, only put enough of a nudge on to get a result, but if needs be just apply more pressure to get the desired response. It is a game but most people are pretty reasonable, you just need to play according to the rules of the opposition. Some people have plenty of neck and only respect and respond to a harder push. Know your customer and tailor your technique accordingly, it is not a one size fits all play.


Cheers


Peter

professore

Peterdalkey wrote: »

Everybody is pushed for cash these days and the oldest adage in credit control / creditor payments is " those who don't ask, don't need!" . Bit like the front row, only put enough of a nudge on to get a result, but if needs be just apply more pressure to get the desired response. It is a game but most people are pretty reasonable, you just need to play according to the rules of the opposition. Some people have plenty of neck and only respect and respond to a harder push. Know your customer and tailor your technique accordingly, it is not a one size fits all play.


Cheers


Peter

What he said sums it up nicely.

FewFew

Peterdalkey wrote: »

Everybody is pushed for cash these days and the oldest adage in credit control / creditor payments is " those who don't ask, don't need!" . Bit like the front row, only put enough of a nudge on to get a result, but if needs be just apply more pressure to get the desired response. It is a game but most people are pretty reasonable, you just need to play according to the rules of the opposition. Some people have plenty of neck and only respect and respond to a harder push. Know your customer and tailor your technique accordingly, it is not a one size fits all play.


Cheers


Peter

Might just print that out

Cash flow is the issue alright, so did some asking.

To be fair the on-going clients are really good. Received payment the day after inquiring with no fuss, said they just forgot.

Other once-off clients are currently killing me, but after enquiring it seems one is trying their best to milk me for every cent, while the other is just woefully unorganized.

I'll know better going forward.

Compton

Ireland is tough regarding getting payments on time, or ever in some cases. Be very careful with people, sometimes its better to lose a sale (or just not give something away for nothing)

FewFew

Compton wrote: »

Ireland is tough regarding getting payments on time, or ever in some cases. Be very careful with people, sometimes its better to lose a sale (or just not give something away for nothing)

Thankfully I'm not losing anything but my time. Can't imagine the stress of having suppliers looking for payment while I'm looking for payment from clients.