The Future of Small Business Invoicing: Trends and Innovations to Watch
For many small business owners, getting paid depends on the age-old invoicing process. You do the work, send an invoice, and then wait to get paid. But with so many invoicing tools and technologies available, it can take time to keep up with the latest trends and innovations. In this blog, we'll explore the future of small business invoicing, including the newest automation, integration, and mobile-friendly software. So, let's get started and discover the exciting possibilities of invoicing in the modern era.
Trends and Innovations in Invoicing
Invoicing has come a long way in recent years, with new technologies and innovations transforming how small businesses manage their finances. The growth of the Internet economy primarily drove the first wave of innovation as paper-based invoices moved online. The next wave came from mobile apps, and automation is now causing a massive shift in how small businesses bill their clients. Let's run through some of the latest trends and innovations to watch in small business invoicing.
Automation of Invoicing Process
One of the most significant innovations in invoicing is automation. Automating invoicing can save time, reduce errors, and improve cash flow. Automated invoicing tools can generate and send invoices automatically, track payments, and even send payment reminders. This means less time spent on administrative tasks and more time for you to focus on your business. Examples of popular invoice generators include Thriday and Invoice2Go, which offer intuitive interfaces and branded templates. With these tools, you can create professional-looking invoices in minutes and send them to clients with just a few clicks.
Integration with Accounting Software
Another trend in invoicing is integration with accounting software. Integrating your invoicing and accounting systems allows you to streamline your financial management and gain a more holistic view of your business. This will enable you to track expenses, reconcile accounts, and generate reports with ease. Thriday is the first next-generation accounting platform that integrates banking, accounting, tax and invoicing. Thriday can automate the end-to-end process of getting paid by having everything in one place. Once an invoice is sent from Thriday and the client pays it, the income is automatically reconciled, the invoice status is updated to paid, and all the appropriate accounting and tax calculations are completed in real-time.
"Thriday is the first next-generation accounting platform that integrates banking, accounting, tax and invoicing. Thriday can automate the end-to-end process of getting paid by having everything in one place."
With the rise of mobile devices, mobile invoicing has become increasingly popular among small businesses. Mobile invoicing apps allow you to create, send, and track invoices on the go, making it easier to manage your finances from anywhere. Mobile invoicing is perfect for tradies, consultants and creatives who can issue an invoice whilst they are with the client. This also leads to quicker payment times. With 44% of small businesses using a mobile app for invoicing, the technology has become very popular over recent years.
Automated Income Reconciliation
Another significant trend in small business invoicing is income reconciliation. This involves comparing your bank transactions and accounting records to ensure all income is accounted for and reconciled. This can help you identify discrepancies, track expenses, and ensure your financial records are accurate. Automated income reconciliation is vital; without it, you can't support automatic payment reminders. The reason is that if you send your clients reminders to pay, but they already have, that will create confusion and even potentially upset them. Thriday, which offers bank accounts*, can reconcile income in real-time (as soon as the funds hit the account) to ensure automated reminders are turned off immediately.
Remember to sign up for Thriday to start sending professional invoices today.
Types of Invoices
When it comes to invoicing, there are several types of invoices you should be familiar with, depending on your business needs. Here are three of the most common types:
1. Tax Invoices
Tax invoices are invoices that include the amount of goods and services tax (GST) that has been charged on a sale. In Australia, all businesses registered for GST must provide tax invoices to their customers. Tax invoices must include specific information, such as the business name, ABN, date, and a clear description of the goods or services sold. Tax invoices are essential for small businesses to stay compliant with tax regulations. With invoicing software like Thriday, you can quickly generate tax invoices that meet all the required specifications.
2. Recurring Invoices
Recurring invoices are automated invoice requests that are sent out on a regular schedule, usually weekly or monthly, to clients. They are popular in circumstances where a subscription has been established, or the business and client know the cost of the work is agreed upon and won't change over a period of time. Recurring invoices simplify billing, saving time and effort for businesses and their clients. With recurring invoices, customers can set up automatic payments, ensuring that bills are paid on time without manual intervention.
3. Progress Invoices
Progress invoices are issued incrementally throughout the completion of a project, with each invoice reflecting the progress made on the project. They are popular because they provide businesses with a way to maintain cash flow while working on long-term projects. Progress invoices typically involve an upfront down payment and multiple invoices issued at specific milestones throughout the project. These invoices help to ensure that the work is progressing as planned and that the client is satisfied with the results before additional work is completed. The process works by setting up a payment schedule that reflects the project's progress and sending out invoices that reflect the percentage of the work completed at each milestone. This helps to provide clarity and transparency for both the business and the client and ensures that payment is received as work progresses rather than at the end of the project.
If installing a pool, and the total cost is $60,000, $20,000 could be paid at the start, $20,000 halfway through the project and $20,000 at the end.
By using the correct type of invoice for your business needs, you can stay on top of your finances and ensure that your invoicing is accurate and compliant. Next, we'll discuss the benefits of automated payment reminders to improve your cash flow.
Automated Payment Reminders
As a small business owner, one of the biggest challenges you may face is ensuring that your customers pay their invoices on time. Late payments can cause cash flow problems and strain your business finances. Before new technology, such as automation, chasing up overdue payments meant calling clients and hoping they would respond. These calls were very awkward for business owners to make and could lead to a negative perception from the client. That's why automated payment reminders have become so popular.
How do automated payment reminders work
Automated payment reminders are a feature available in many invoicing tools that allows you to send reminders to customers who have overdue invoices automatically. Instead of manually following up with each customer, you can set up automatic reminders at regular intervals until the payment is made. Setting up automated payment reminders is easy with invoicing software like Thriday. Select the invoices you want to send reminders for, choose the frequency and message for the reminder, and let the software take care of the rest.
Benefits of using automated payment reminders
There are several benefits to using automated payment reminders, including improved cash flow, time savings and improved client relationships. By reminding customers to pay their invoices on time, you can improve your cash flow and avoid the need to chase up late payments. Automated payment reminders save you time and effort by eliminating the need to follow up with customers manually. Sending automatic payment reminders is a professional way to ensure that customers pay their invoices on time, without the need for uncomfortable conversations or confrontations.
Thriday Automates Invoices
Thriday is an all-in-one financial management platform that includes invoicing software. Thriday is recognised as a market-leading platform for small business owners who want to save time and money on financial admin.
Thriday makes it easy to create and send professional-looking invoices. With a few clicks, you can create an invoice, add your branding and logo, and email it to your customer. Thriday also allows you to track the status of your invoices, see when they've been viewed and paid, and send automated payment reminders to customers who have yet to pay on time. In summary, Thriday offers:
- Unlimited invoices and quotes
- Professional invoice templates that you can tailor to your brand
- Invoice tracking so you can see the status of each invoice you generate
- Send customised invoice emails and messages to clients
- Automated payment reminders and status updates
- Real-time invoice income reconciliation
- Ability to convert quotes to invoices
- Download and print PDF invoices
Benefits of Thriday Automated Invoices
There are several benefits to using Thriday for your invoicing needs, including:
- Cut costs: With Thriday, you can send unlimited invoices and quotes at a fraction of the cost.
- Time savings: Thriday automates the invoicing process, saving you hours each week.
- Professionalism: Thriday's professional-looking invoices help you make a good impression with clients.
- Improved cash flow: Automated payment reminders improve your cash flow and avoid late payments.
Why Thriday is better than other invoicing tools
While many invoicing tools are available, Thriday stands out for several reasons. First, it's effortless to use, even if you don't have any accounting or invoicing experience. Second, it's super affordable. Finally, Thriday's customer support is top-notch, with a dedicated team available to help you with any questions or issues.
If you're looking for an easy-to-use, affordable, and effective invoicing tool, join Thriday for free today. With Thriday, you can streamline your invoicing process, improve your cash flow, and save time and effort.
What is an invoice?
An invoice is a document a seller sends to a buyer detailing the products or services provided and the payment due.
Why is invoicing important for my business?
Invoicing is essential for your business because it helps you get paid for your products or services. It also enables you to track your income and expenses, manage cash flow, and maintain compliance with regulatory requirements.
What should I include on an invoice?
An invoice should include the date of the sale, a description of the product or service provided, the quantity and price, any applicable taxes or fees, and the payment due date and payment terms.
Can I create my own invoices, or should I use a template?
You can create your invoices using a spreadsheet or word processing program, but it's more accessible and more professional to use invoicing software like Thriday. With Thriday, you can pick from multiple templates and personalise the branding and colours.
What happens if a customer doesn't pay their invoice?
If a customer doesn't pay their invoice on time, you may need to follow up with them to request payment. If using automated invoicing software like Thriday, reminders will be sent automatically. If the payment is still not received, you may need to take legal action or send the account to collections. It's essential to have clear payment terms and a process for handling late payments.
Invoicing is essential to running a small business, but it shouldn't be a headache. In this blog, we've discussed some of the latest invoicing trends and innovations, including automation, mobile invoicing, income reconciliation, and the different types of invoices, such as tax, recurring and progress invoices. If you're looking for an invoicing tool to help you automate your invoicing process and improve your cash flow, we encourage you to join Thriday today. Thriday is affordable, easy to use, and backed by a dedicated customer support team. Finally, we encourage you to keep up with the latest invoice innovations as technology is improving at a rapid rate.