10 common invoicing mistakes that delay payment
Everyone makes mistakes, we’re only human after all, but a mistake on an invoice could lead to disputes on payment and be costly for your business.
To help in your fight against late payment we take a look at 10 common invoicing mistakes and how you can avoid them.
1. Not invoicing straight away
As soon as your goods or services have been provided send your customer an invoice. Any delay you make will give your customer an excuse to stall payment.
2. Getting customers’ addresses wrong
When you have lots of customers it can be easy to mix up addresses, but this mistake could be disastrous for your business. In the best case scenario you’ll be left embarrassed and there may be a delay in payment. Worst case scenario you could end up violating your contract by divulging your client’s private information to another party. This simple mistake could cost your business a large amount in legal fees – not to mention the delay in payment.
3. Addressing the invoice to the wrong person
Often when dealing with large companies the person you are corresponding with is not the person in charge of paying you. Make sure that, when sending the invoice, you address it to the most relevant person. If you’re not sure who this is, ask, or you could face a long wait for your payment.
4. Not displaying credit terms prominently
Sending an invoice is pointless if you don’t tell the customer when they need to pay by. Always include your credit terms in a prominent position that your customer can clearly see. Better still, provide an exact date that payment must be received by. This will reduce the chances of your customer missing the deadline date.
Take a look at some tips to optimise your credit terms and encourage customers to pay faster.
5. Not offering/detailing a range of payment methods
It’s always good to give customers a choice, so where possible try to offer a range of payment methods and make sure these are clearly stated on your invoices.
6. Getting the amount wrong
Always check that you have got your numbers right. Any mistakes, no matter how big or small, could lead to disputes and delays in payment. Even something as simple as accidentally using the wrong currency mark could result in a company failing to pay.
7. Adding on undiscussed fees
Similarly, do not be tempted to add on undiscussed fees. Customers do not like surprises and added fees are likely to anger your customer and could lead them to refuse to pay the outstanding balance. If you need to bill for more than originally discussed speak to the customer first. Do not just assume they will be happy with any extra fees you wish to charge.
8. Not proofreading
Not only do mistakes look unprofessional and reflect badly on your business but they could lead to disputes on payment. A lot of the common invoicing mistakes mentioned could have been avoided if the invoice was checked for grammar, spelling and mathematical mistakes. Never send out an invoice without checking it first, it could save you a lot of embarrassment in the long run.
While you’re proofreading, why not take a look through these tips to improve your invoices and see if any could be beneficial to you.
9. Not following up
Once the invoice is sent do not assume that your customer has received it and will pay accordingly. This is not always the case. Follow up with a courtesy call to check that they have received your invoice and their intentions to pay. Check out our timeline to getting paid for more information on chasing late payment.
10. No back up files
It is essential to keep back up files of all invoices not only for your own reference but in case there is a dispute with payment. You never know when you might need to refer to these so make sure they are stored in a safe place and that you have a back up just in case.
Take a look at some strategies for handling disputes here.
If you’re struggling with late payments our debt collection services may be of interest to you. Call us on 0800 9774848 or request a call back to see how we can help.