7 Common (But Totally Avoidable) Invoicing Mistakes

By December 19, 2018Purchase Order Plus
invoicing mistakes you should avoid

We all make mistakes from time to time. It’s only human to err. The question is, do you learn from those mistakes or are you repeating them over and over again?

Some mistakes can be more costly than others. If you run a small business especially, a seemingly minor omission can set you back or even ruin your entire business. With that in mind, here are 7 common invoicing mistakes that you need to learn to avoid in the future.

1. You’re Sending the Invoice to the Wrong Person or Department

Your invoice needs to get to the right address if you want it to get paid. The problem is that most people consider the company as a whole they were working with to be that “right address” and then just leave it at that. 

But did you get the right department or, even more importantly, the right person in that department? The one actually responsible for receiving and paying invoices? 

You may be thinking this is something your contact in the company should deal with and that they should simply forward your invoice to whomever it should really get to, but that’s not the way it goes. If you do that, be ready to wait a long time to get that invoice paid. No. Your first question should be “who do I address the invoice to”?

2. You Wait too Much to Send the Invoice

Maybe you have too much on your plate, but the longer you wait to send the invoice and demand your payment, the less chance there is that it will be paid on time. 

Look, if you don’t consider your own invoice important enough to send it immediately, don’t expect the customer to think off it any more important either.

3. Your Invoice is Not Detailed Enough

Consider these two invoices for a moment. One only has the company address and the amount that needs to be paid, the other also includes the name of the recipient in the company, your contact in that company, due payment date, invoice date and number, specific payment terms, applicable tax numbers of both your and your customer’s company and a list of supplied items.

Now, which do you think has more of a chance to get actually paid? If your answer was number two, you were spot on.

4. You Don’t Have a Due Date in Your Invoice

Perhaps this is due to the fact that your first customer was a friend and you agreed to do him a favor and wait till he gets the money next week. But then the “next week” turns into “next month”, this turns into “next year” and your friend has bought a new car. 

Do you see the pattern here? Demand your invoice to be paid by a very specific date and introduce a penalty fee if the customer goes over that day.

5. You Don’t Backup Your Invoices

As much as computers and invoicing software make creating and sending invoices easier, there is also the danger of losing them due to unforeseen circumstances. Your computer could crash, you may have a virus or a bug.

And then what? You lost the invoice and have to start all over again. How to avoid that step back? It’s very simple. All you need is to remember to backup your invoices to the cloud.

6. You Don’t Make it Easy for Customers to Pay You

Your main concern is for the customer to pay your invoice. How they actually do that is much less relevant.

So why make it hard for customers to pay you? Why have only one way for the customer to pay? Perhaps that particular way is difficult for them for some reason?

Make it easy for the customer to pay you by offering several options in your invoice.

7. You Don’t Follow Up and are Not Polite

Okay, this is actually a two-parter, but both are equally important. A nice word goes a long way and according to FreshBooks, a bit of politeness will increase the chances of having your invoice paid by 5%. 

Believe me, that is nothing to scoff at and it only requires you to say an occasional “thank you” and “please”. 

The other is not following up on the invoices you’ve sent. Perhaps the customer is overdue with them? Don’t wait for them to remember, but remind them about it right away. And for those that keep ignoring you, perhaps it’s time to tone down a little on the courtesy and show your meaner side?

Conclusion

There you have it! 7 common invoicing mistakes that you can easily avoid if you pay just a little more attention to them. Know of any other invoicing mistakes? Let us know in the comments below and don’t forget to sign up for a free Purchase Order Plus trial.

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