How Automatic Recurring Invoices Can Save You A Lot of Time

Invoicing and collections are among a few things that you should start automating in 2015. Sending invoices to your clients on a repeating basis is not only tiring but also time-consuming. This is especially challenging for a small business that have limited resources. However, it is critical to your business’ cash flow and by no means you can afford to overlook it.

It is therefore essential for a small business to deploy a proper invoice management to produce cost-effective invoicing solutions that will also stimulate customers to make the payment on-time. Online invoicing services can save you here. Many of the invoicing software offer the options for recurring invoices to help small businesses increase their collections and reduce their invoicing time.

What is Recurring Invoices?

These are free-form invoices used by businesses and freelancers alike for services/products that are billed cyclically. Recurring invoices are created on regular intervals as directed by the user such as daily, weekly, quarterly, half-yearly, and/or yearly. In general, they are automatically sent to a client. In short, automatic recurring invoices allow you to charge your clients’ credit card automatically on a regular basis. Additionally, you have the option to save them as a draft so that you can review the invoices before sending them out to the clients.

Web hosting, digital marketing, general consulting or similar services that do not need reconciliation against a fixed number of working hours are better suited for recurring invoices.

How to Use Automatic Recurring Invoices

There are several options available to use recurring payments. You can charge your clients using any of the following payment options:

• Credit Card or CCRP allows you to charge your recurring bills automatically to a given credit card


• Debit/Check Card or DCRP is a process where recurring bills are deducted automatically from a debit/check card


• Direct Checking Account Deduction allows transferring funds via ACH or direct debit


• Direct Payroll Deduction involves automatically deducting the regular recurring bills from an employee’s paycheck

To leverage the power of automatic recurring invoices, business owners first need to set up a recurring profile with an online invoicing solution provider and sync the account with their existing payment gateways. Some of the gateways that businesses can use to auto-charge their clients include PayPal Payflow Pro, Braintree, Authorize.Net, and Stripe.

Once you have set up your account with an auto-invoicing capable gateway, you need to fill in the credit card info of your clients and get their permission to charge their cards automatically. It is a rather simple and easy task. You will be notified every time a new invoice is created so that you can take immediate action. In case you don’t have the credit card information of your client, you can still send him/her automatic recurring invoices.

When a bill gets sent to your clients, they have the option to make the payment automatically through their credit cards for all future invoices sent from your recurring profile. Upon selecting this option, your auto-invoicing capable gateway will update your profile with the clients’ credit card information. They will be auto-charged on their credit card from that point onward.

Advantages of Recurring Invoice

Scheduling Your Invoices Automatically

Sending invoices manually is a boring and annoying job. With automated online invoicing, there is no need to go through such complex accounting process ever again or remember details of your customers. All you need to do is schedule your invoices on a weekly/bimonthly/monthly basis at a go and everything else is automated.

Saves a Lot of Time

As mentioned, creating and sending invoices manually is a time-taking task. Automated recurring invoicing not only help you scheduled date but generate and deliver the bills automatically to your clients, freeing your valuable time. This means, you will have more time to invest on more productive, billable works to generate more revenues.

Cut Down on the Paperwork

Online invoicing also helps you to cut down on paperwork. You can sign up for paperless statements and it even allows you to import your data, making it easier to track the collections. Sending invoices late is a major concern for both businesses and customers. Businesses are badly affected by late payments in terms of cash flow; and for the latter, it usually means paying late-fines. With online invoicing, you will never have to worry about them as they are taken care of automatically.

Easy Record keeping

The invoicing software takes care of all the paperwork and also records the data for future references. You can even pause or cancel an invoice and approve others to be sent out to clients. Everything is stored in your software.  This makes bookkeeping easier and as a result your account books are always in good shape.

Predicts Earnings & Cash Flow

These online invoicing services also help in predicting your business’ earnings and cash flow for a particular month/period. In fact, you can better calculate the cash inflow than you could have ever done with a manual invoicing process. Better yet, such invoicing process helps you forecast your company’s future financial growth.

Secure and Automatic Payments

Recurring invoicing not only helps you create and deliver invoices automatically, but also provide a secure mode of payment. The reputed online invoicing services usually offer a number of secure payment methods including Google checkout, PayPal, and wire transfer to allow customers make the payment without worrying about the safety of their confidential data. Besides, scheduled invoices means that your clients are aware of the invoice and payment dates and are ready to make the payments without causing any delay.

This brings us to the next point...

No Overdue Invoices

Using online invoicing you can quickly track all your overdue invoices and accordingly send out reminders to clients. Most online invoicing services allow you to access your overdue invoices from a single, convenient place. You can therefore track records of average payment delay data of a client(s) and keep an eye out for such unruly clients. Automated recurring invoicing process also allows you to:

• View client statistics and other critical data and access any overdue invoices


• Get an idea about the payment behavior of your clients


• Analyze average payment delay


• Graphical evaluation for your payment delay distribution


• Keep a record of invoices/reminders sent to a specific client

In fact, sending reminders to late-paying clients is essential to avoid slow pay. Again, sending invoice reminders manually is a tough job and will end-up wasting a lot of man-hour. Automating the process here again will be beneficial in the long run to avoid late paying.

Most of the reputed invoicing tools allow you to send reminder emails to your clients once the payment deadline has passed. This comes across as a better and easier process to collect dues.

Conclusion

Many small businesses are reluctant to deploy online invoicing systems due to high costs. While it is true that there are many high-end invoicing tools that are a tad too expensive for small businesses, a number of SaaS providers are also offering basic online invoicing services for free or for a nominal charge.

In fact, you can find various reputed SaaS providers offering quality and secure invoicing services. Although the features included in the free plans are mostly basic, they are good enough to help you create a proper cash management strategy and of course save your time.

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