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Invoicing a customer

How often do you invoice a customer? What details do you include in the description of your work?

4 REPLIES 4
Advocate VI

I do all of my invoicing on the first of the month, for work done during the previous month... but I am contemplating switching to a pre-paid plan, similar to what others have mentioned here. I really like the idea of having them pay first, and then I just work it off. That would reduce the time I spend on chasing people for payment after the work is done!

Also, I have a number of folks who don't ask for much, so they may ask for something that takes half an hour, and if I don't want to spend the time writing an invoice for that, it gets carried forward until they have at least an hour. That's often more efficient but it means I'm giving them a small interest-free loan.

I have been contemplating something like my Starbucks or BART cards, where they are pre-loaded and when I buy coffee, the amount is debited. I know I can do that by having people pre-pay for some number of hours. Then the extra money is sitting with me until they use it -- lower risk for me! The only drawback is that I may lose a few clients who don't want to do that. But I will figure it out.

I keep track of tasks every day in a big Word file, and it's a line-item per day. So to send an invoice I can just copy/paste from that file right into the invoice.

Super User II Super User II
Super User II


@Rachel wrote:

How often do you invoice a customer? What details do you include in the description of your work?


As little as humanly possible. I so try to just invoice a client once per year on their birthday/anniversary or whatever you call the annual bill date. Our maturation dates are always on the 13th of the month which is great because we typically bill on a net-30 and find it give the flexibility of paying at the beginning or the end of the month with at least two weeks notice. I also don't like working at the beginning of the month, the end of the month or Mondays (no idea what I will do in June).

To encourage our customers to pay annually we offer a two month discount, so if you pay a year upfront you get around 17% off which most people then choose to do. We offer that discount for everything and the time it saves in administrative cost is immense. I don't know if I feel like I can't afford an in house person or if I secretly like dealing with the money myself but that is how I do. For employees pay day is also the 13th or if the 13th falls on a weekend the Friday before.

As for what is on the invoice it could be anything from a simple one line invoice to a loaded statement of work and contract renewal. We send all annual invoices out as documents to be reviewed and signed so that we have a digital record. There may be new documents describing new services in that package but it all needs to be signed and filed. I like that my clients sign their invoice because I NEVER have to chase anyone down. When I send out the invoice it expires in 30 days (the net-30 period) and if the client doesn't sign it when it comes back expired we know what to do. If we see that they signed it and it is filed but we don't get a payment then we know what to do but I try to be nice. Chase? No way!

One thing to mention from my view is that money in the bank is nice if you are running your own business. I like to keep a bit of a business nest egg so that I'm not worrying on the 10th about meeting payroll on the 13th. Even when I was a one man show it was nice to get annual money in bulk because it gives me so much ease in my working life. We also do not have invoicing in November and December and do not accept new client work in those months*. April and October are our huge renewal months because that is when we invoice for domains.

*Of course we will accept clients in November and December if it is money but as a general rule we find that no one says "It's almost Christmas time, let me buy a website!" We also support our clients during this time but usually we are operating with a smaller crew.

...turns out that my two cents is worth less or more depending on the current exchange rate.

roy darling *my posts seem a lot shorter in my head

All of this is so educational for me, in terms of seeing how other people do things. I really do want to change to some sort of advance payment situation. And offering a discount as an incentive sounds like a very good idea.

 

Funny thing, though... @rd says "Of course we will accept clients in November and December if it is money but as a general rule we find that no one says "It's almost Christmas time, let me buy a website!" 

I actually get a lot of inquiries in the fall, when people DO want a new website before Christmas (or more likely before year-end). Not to say that I agree to those projects. I do not want to start a project near the holidays, and I don't want to work that hard over the holidays. But people certainly do ask.

My policy is that after November 1, if someone approaches me, I'm happy to write a proposal and get approval, but we don't start the project until the beginning of January (barring very unusual circumstances).


@webdiva wrote:

I actually get a lot of inquiries in the fall, when people DO want a new website before Christmas (or more likely before year-end). Not to say that I agree to those projects. I do not want to start a project near the holidays, and I don't want to work that hard over the holidays. But people certainly do ask.

My policy is that after November 1, if someone approaches me, I'm happy to write a proposal and get approval, but we don't start the project until the beginning of January (barring very unusual circumstances).


Typically we have some projects in the works that we are trying to button up going into the end of the year. The end of our fiscal year is October 31 so anything after that is next year anyway. At the end of the year approval time from clients extend, my people are wanting to be at home with their family, we are travelling, our clients are travelling... It is really a logistical disaster.

When thinking of invoicing good practice is to have a cutoff time for your year end. I use November to get things together for my accountant and I'm ready earlier in the year rather than having to wait and get in line to get serviced. At the beginning of the year I am already looking for new business while some are finishing up with old business and accounting.

...turns out that my two cents is worth less or more depending on the current exchange rate.

roy darling *my posts seem a lot shorter in my head