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A recent study reveals that more than 40% startups send invoices that are not up to the mark. They are either incomplete or unclear. Some are even incorrect. This is the reason why the other party delays payments. Invoices are not processed until and unless they are clear, complete, and explain every single detail. Unclear invoices will stay untouched until you get in touch with them for the second time and ask about the payment. That is when the other party will point out a few errors in the invoice and request you to redo it. This will not just waste your time; it will also delay your payments.
This is why you should fashion an invoice such that it gets processed immediately. If you take care right from the time you create your first invoice you won’t face any problem in the future.
We have a few tips that you can follow to make your own invoice:
Seller and Customer Information
Every invoice must have information about the seller as well as the information about the customer. For strange reasons, people tend to skip one or both of these details. You are the seller. You should include all your details in the invoice including the company’s name, address, telephone number, and email ID. Likewise, you should include all details of the customer. In case you are dealing with a company, we advise you to put in details of the single point of contact (SPOC) as well so that if the company has doubts about the order, they may talk to that person and clear it.
Invoice Number and Other Related Details
Every invoice needs to have a unique invoice number that also includes the order number. This won’t be of any help to the customer but it will help you keep track of your accounting with ease. Be very careful to enter the invoice number correctly.
Quite obviously, every invoice should also have dates such as the date the order started and ended, and the date of the invoice. You may also include the deadline (as per your agreement) for payment.
Description of the Order
We have seen many invoices miss this as well. The customer needs to know all details of the order including the breakdown of the pricing, especially when it is a large order. Don’t be under the impression that the customer will be aware of the order details.
Taxes and Additional Charges
Every single detail of taxes and add-ons must be described in the invoice very clearly. Giving this a miss can cause serious problems due to confusion.
Aforementioned are the most important details that every invoice must have. You may add a few more details depending on the requirements.
The most important thing about creating an invoice is paying attention to the details. You have to be very sure about including every detail about the order so that your invoice is clear to the customer and is processed quickly. You should learn how to do an invoice immediately after you startup.
Image courtesy of [Stuart Miles] / FreeDigitalPhotos.net