All business owners have one common goal: to make running their biz easier. Whether this means becoming more cost-effective, more efficient, or more profitable, there’s also one common solution.
Technology has made it possible to automate tasks in pretty much every area of your business. From marketing to fulfillment, automations can create efficiency across your entire company. And one key area we’re looking at is invoicing.
Automated invoicing gives busy entrepreneurs the chance to focus more on what makes their business so great and less on the pesky administrative activities associated with it. Let’s take a look at why you should consider automated invoicing, and seven ways you can start doing it.
Why automate invoices?
Automations across the board save you time and money. And time is money for a busy entrepreneur. If you want to put a number on it, one study found that labor costs make up more than half of all expenses associated with companies’ accounts payable systems.
But the benefits of automating invoices extend beyond that—especially if cash flow ebbs and flows. Automated invoicing can help you get paid faster. The majority of small businesses are paid late, and unpaid invoices in the U.S. amount to $825 billion. The average wait time to get an invoice paid? 72 days!
Plus, automated invoicing means your books are always up-to-date. Access to real-time financial records and reporting is crucial if you’re always on the go. (You’ll really appreciate this during tax time too.)
How to automate invoices
1. Email reminders when an invoice is coming due
Why wait until after an invoice is due to send a reminder? Sometimes, a client might receive an invoice, set it aside to pay later, and forget about it.
With Wave, you can set automated reminders to send 14, 7, or 3 days before the invoice due date. This is a friendly way to remind them that the deadline is approaching. It also feels less invasive.
2. Email reminders when an invoice is due
When the invoice due date arrives, you can also set your invoicing tool to remind your clients. These automated emails let the client know that payment is due today, so they can easily click through and pay it on time.
3. Email reminders when an invoice is overdue
Late payments are sometimes inevitable, even if you’ve taken the above steps. Following up on late payments isn’t the best use of your time, so an automated email notification of overdue invoices is a great way to stay on top of unpaid invoices without investing your time in it.
Use an accounting tool like Wave to set up timed reminders. This feature sends your client an email at various chosen periods—3, 7, or 14 days—post-payment due date.
4. Recurring invoices
If you have clients on retainer or customers signed up for your subscription services, manually creating the same invoice each period is tedious, time-consuming, and repetitive.
For ongoing projects with the same invoice each period, you can create the invoice once and schedule it to send each period. Wave’s recurring billing features will also automatically generate unique invoice IDs to avoid duplication.
5. Automatic payments for recurring invoices
You can also take the automation a step further and automate the actual payments of recurring invoices, as well as automated invoice generation and sending. This requires an extra level of trust with your customer, as they’ll be allowing you to automatically charge their credit card or bank account on an ongoing basis. But, it also saves them time, so this could be an attractive option not only to you but also to the individual making the payment.
If you do this in Wave, you can either prompt an email to send to your customer, requesting they enter their payment information for auto-pay. Another option is for them to provide you with their payment info directly, such as over the phone, so you can manually enter it.
6. Scheduled invoices for future payments
If you’ve closed a sale but aren’t ready to send the invoice yet, you can also schedule invoices to go to the customer at a later date.
Let’s say you’ve booked a major project slated to start in two months. You might want to create the invoice now and schedule it to go two months later—one less check box you’ll have to tick when kicking off the project. This can help you focus on the work rather than the pesky admin associated with it.
7. Create invoices with Google Forms
If you use Zapier, you can also employ automated invoice generation with Google Drive:
- Google Forms: If a user submits or edits a response, you can tell Zapier to signal to Wave that it’s time to create an invoice.
- Google Sheets: You can also use Google Sheets to automatically generate invoices when you’ve added or updated a worksheet, spreadsheet, or row in the associated document.
Moving forward with invoice automation
Automations continue to change the way we do business, allowing SMBs to create a virtual “team” to help run their business. The best part about reducing the time you spend on the administrative side of your business is that you get to spend more time doing what you’re good at, and that makes your customers happy.
Making it easier to receive, understand, and pay your invoices is very attractive to your customers. Things like automated invoicing and recurring billing can really help you connect with them at the time that makes the most sense for your business, and enable them to pay you even faster.
The information and tips shared on this blog are meant to be used as learning and personal development tools as you launch, run and grow your business. While a good place to start, these articles should not take the place of personalized advice from professionals. As our lawyers would say: “All content on Wave’s blog is intended for informational purposes only. It should not be considered legal or financial advice.” Additionally, Wave is the legal copyright holder of all materials on the blog, and others cannot re-use or publish it without our written consent.