Bringing precision to project and services billing this 2018
Prompt invoicing and billing is vital to maintaining a healthy cash flow for services and project-based firms, but generating and sending invoices in a timely fashion, tracking received and outstanding payments, and ultimately ensuring efficient turnaround from clients and vendors is no small feat. What changes can a business make in 2018 to bring precision to project and services billing and get paid faster?
Companies that want to be intelligent about time need to create a centralized view of invoices and bills to see at a glance what average payment time is, how much money is outstanding, how many invoices and follow-ups have been sent, which companies are frequently delinquent, and so on. This can help companies decide which business to work with or prioritize, based on how prompt their payments are.
From an HR perspective in particular, increased visibility into the billing process can also help maximize resource utilization through a higher understanding of who is working on what, and which resources are or aren’t available. This will then inform training and hiring decisions based on a company’s true needs.
Automate Wherever Possible
If your company isn’t already paperless, it should be. The quickest and easiest billing is done online, and automating can significantly reduce administrative headaches for the payroll team, and streamline the entire billing process for companies that want to be time intelligent.
Invest in an invoice generation engine to automate the process and remove human error (also, proactive follow-ups can be scheduled and sent without lifting a finger).
Communicate Each Step of the Way
Communication is critical to keeping your business and clients on the same page, billing-wise each step of the way during a project:
Definition and planning: Set clear expectations for payments with your client.
Launch and execution: Keep the client abreast of any and all changes in project direction and progress. Think you’re going to overrun? Need to change direction? The client needs to know ASAP how this will affect costs.
Project close: Ensure that all client needs are met in terms of desired invoicing information and detail, and schedule proactive follow-ups to encourage prompt payment.
Bonus tip: Ensure that your project management system adheres to the level of detail the client needs (having that information easily accessible can help speed invoicing along as well). If somebody asks what a specific charge is for, you want to be able to reply with precise detail.
Putting terms on invoices makes the company 1.5x more likely to get paid on time.
Having more than four people on the invoice makes you 2x less likely to get paid (everyone opens and looks at the invoice, but nobody claims responsibility for it).
You are 3x more likely to get paid if you add a company logo to your invoice.
You are 8x more likely to be paid on time if you put a due date to your invoice (this may sound obvious, but almost one out of every four invoices is sent without a due date).
Raj Narayanaswamy is the Co-Founder and Co-CEO of Replicon. With more than 25 years of software development and senior management experience, Raj is widely recognized for his visionary approach in developing innovative software applications that meet the needs of leading enterprise organizations.