Do you have a new business and having trouble getting your customers to pay on time for goods and services? Or maybe your business is established and you struggle with an abundance of late customer payments.
The problem might not be just with your customers. It can be with your invoicing system. When your invoices are unclear, customers can misunderstand the terms of payment and other criteria.
On the other hand, when you have a good invoicing system in place that’s detailed and clear information, customers know the payment terms that are expected of them.
In this guide, you’ll learn how to write an invoice that prevents late payments. Most of all, you’ll learn how to create a professional invoice that encourages customers to pay you on time.
Without further delay, here is how to write an invoice that will get you paid on time.
Step-by-step guide: How to write an invoice that will get you paid on time
Follow these tips when you create your invoices. They will help put you and your customer on the same page so you receive what’s owed to you when payments are due.
1. How to write an invoice that looks professional
The first thing you need to do is create your invoice. You can do this on your own with computer software or hire a professional to design one for you.
Invoices can be created in a spreadsheet program like Excel, Google Docs or on a word processor such as Microsoft Word. It depends on what program you’re most comfortable working in.
Another option is to use a customizable invoice. They can find many free templates online or in Microsoft applications like Word.
For an invoice that looks professional, include your logo at the top of the invoice as well as your mailing address and other contact information you want to include.
You can even put in a PayPal account or any third-party payment processing system to make it easier for customers to make payments.
2. Write the word “Invoice” at the top
When you write the word “invoice” in a prominent position on the page, such as on the top of the document, your customers will instantly know what they are receiving.
When you clearly display your invoice heading, it lets customers know it’s time to pay. Especially if you send customers other documents such as processing orders or content briefs that can get mixed up in their inboxes.
That’s not including all the other mail they may receive. It’s also a good idea to put the word, “invoice” with the name of the company in the subject line of your email, so they know the invoice is from your company.
To keep things organized, assign a unique identification number to each invoice. It can be as simple as 001 for the first invoice, 002 for the second and so on.
You can also use letters to identify your client’s business or name such as Johnson001.
These reference numbers will not only let your customers know which invoice you’re sending, but they will also help you with your record-keeping and avoid making duplicate invoices.
3. Always include your business and customer’s contact info
Invoices should always include your company information and details as well as your customer’s name and details.
- Your business name, mailing address, telephone number, fax number, and email address
- Your customer’s business name, the point-of-contact name so it reaches the right person, mailing address, telephone number, fax number, and email address
- Your formal registered name, office address, and business registration number if you’re a limited company
4. Remember to include invoice dates
Don’t forget to include the dates on your invoice. You’ll most likely have two dates:1) the date you created the invoice; and 2) the date you provided your product or service, which is also known as the supply date.
You can also input the supply date in the description section for products and services, and similar to a professional letter, add the invoice date right below your name and contact details.
5. Write a description of the product or service
The descriptions on invoices can be brief, but they should contain the details so customers know what they are being charged for. You can even use bullet points to put in the details.
When your invoice is unclear what the charges are, it can lead to a payment delay because they’ll probably need to contact you to discuss the charges for clarification.
If you write a clear description of the item, quantity, and price, they will know exactly what they are being billed for.
6. Include the total in bold
Why it’s good to provide an itemized list of charges, it’s also important to include the total. Put the total for products and services in bold so there is no confusion.
When you’re offering a discount, add the discount after the charges and subtract it from the total owed.
If applicable, include the VAT amount too if it applies.
7. Include your payment terms
While you may have agreed on payment terms such as Net 30 on the phone or by email, it’s important to make this clear on the invoice. Also include the method of payment such as via PayPal, making a direct payment to your bank account or paying by check.
If you want your customer to make a direct payment to your bank account, include your bank details.
The same goes for online payment providers. For PayPal, provide the customer with your PayPal account number which is an email address you used to set up your PayPal account.
The bottom line on how to write an invoice
Now you know how to write an invoice so your customer will be encouraged to pay you when payment is due.
By including the right details, you’ll greatly improve your chances of being paid on time. It doesn’t matter if you use a spreadsheet or a simple invoice template that you can customize.
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