Whether you’re a small business or a large company, at some point, you’ll need to send an invoice to a customer, client, or another organization. While invoice templates are a great starting point, they come with limitations that can possibly impact your growing business.
Here is why making the switch might make more sense for you and how it can help you focus on the more important parts of your business while saving more time and making more money.
What is an Invoice Template?
An invoice template is a pre-designed, customizable template that contains all of the fields needed to invoice a customer, such as business details, item descriptions, quantities, and pricing. It also has the terms and conditions, which further outline how to get paid as well as any specific due dates.
The Main Drawbacks of Invoice Templates
While invoice templates serve their purpose for most businesses, the truth is that they can only meet your needs for so long.
Most start out with an invoice template and eventually graduate to an invoicing system. Many issues start to arise when a business starts to scale. Creating an invoice template from scratch can be very time-consuming, especially when it comes to generating hundreds of invoices per month for most businesses. There are many other systems in a business that boost productivity, such as HR portals and payroll systems.
Errors
We are all human, so making an error from time to time is completely normal. When it comes to invoicing, it can have large repercussions, such as inputting the wrong date or calculating the wrong total. With many different tax rates, subtotals, and other calculations, it can be easy sometimes to make a small error by mistake.
Payments
Invoice templates do not have any payment integration. Typically, the only thing that an invoice template contains is information about how to pay the invoice. There is no way to pay the invoice online quickly and efficiently. It should be a top priority to make it as easy as possible for a customer or client to pay your invoice once any work or service has been completed. Missed or late payments are important issues that most companies have to deal with, so manually tracking these is always a separate nightmare.
Organization
When creating an invoice template, you must organize and sort it yourself. This can sometimes lead to drafts of invoices being lost or any paid invoices being misplaced. To avoid this, many businesses use cloud-based invoice templates that are stored securely and accessible from any device. This not only prevents data loss from hardware failure but also saves time and stress.
Why and What is an Invoicing System?
There are many benefits to switching to an invoicing system. An invoicing system acts as the brain for all of the invoices that you create. Not only does it save you time, but it also allows you to boost your productivity by spending less time invoicing and more time on other business operations.
Easier Tracking
Invoicing systems make it much easier to track invoices that are paid and unpaid. When you are using just a standalone template, you do not have any of the smart tracking capabilities. The system can also act as your second brain by automatically sending recurring invoices if you are invoicing a specific customer every week or month.
Faster Payments
The whole point of invoicing is to receive payment from your customer or client. Invoicing systems integrate with the most popular payment processing systems such as Stripe, Paypal, and many others. Once an invoice is sent out, the receiver can easily open the invoice and be directed straight to the payment gateway and pay in seconds. With traditional invoices, there is a lot more effort that has to go into paying the invoice since it lacks simple integrations. Along with getting paid quicker, invoice systems allow you to view quickly and filter for any unpaid or paid invoices.
Better Organization
With an invoicing system, you can easily search for a specific invoice as well as filter for specific time frames. You can also keep track of all invoices created and billed for the year which helps for tax season. Without a system, it is very difficult to gather each and every invoice manually; this can leave room for invoices being forgotten, as well as misplacing documents.
When it Makes Sense to Make the Switch
If you rarely send any invoices, you probably do not need to switch to an invoicing system. If you are continuously sending invoices every month, need accurate financial tracking especially for taxes, and you want to save time overall, then a system is for you.
A standalone invoice template is a great starting point, but not a long-term solution. There are many tools that can generate an invoice template such as Invoice Home’s full-service invoicing system. Once you have switched from single-use invoice templates to an invoicing system, you will not want to go back or even remember how you used to live without it!
Images provided by Invoice Home
