Small business owners must juggle various duties, such as recruitment and hiring, marketing, and managing the financing. Of course, managing the finances is more complex than it sounds on the surface. There is daily bookkeeping, taxes, and accounting.
One of the finance duties that some business owners find challenging at first is small business invoicing. After all, most people never get instruction on how to write an invoice. Yet, you will likely find it necessary to prepare an invoice from time to time.
Are you wondering what you should include on your invoices? Keep reading for our guide to small business invoicing.
As a general rule of thumb, you’ll want both your business address and the customer’s address on the invoice. It helps ensure that the customer knows where the invoice originated and trusts that it’s legitimate. Just as importantly, if you include their address, they know that the invoice wasn’t sent to them accidentally.
Your invoices should also include some kind of branding to help identify the invoice as coming from you. Most businesses will include their logo. You may also include the name of the business in your brand colors.
Again, this helps reinforce that the invoice did, indeed, come from your business.
Products or Services
You should always include a detailed breakdown of what the customer got from you. That may mean a list of products or the services rendered.
In general, you should also include the quantity they got of each product or the number of hours worked, if applicable.
You should include the prices for each product or service. Some businesses will include the unit or hourly rate on the invoice, while others do not. Minimally, you should include the total cost for each product or service.
You should include a clear subtotal for all products or services, applicable taxes, and the final total for products purchased or services rendered.
The invoice should note the date that your business issued it. It should also include the date that the payment comes due.
Structuring the Invoice
There is no universal format used for invoices, which makes it your responsibility to develop your format. If you’re unsure how you want the invoices to look, you can always look for a free invoice template.
A template can give you ideas. Alternatively, you may use the invoice template as-is for your business.
Small Business Invoicing and You
Small business invoicing isn’t fun for most business owners, but you should never neglect it. If you don’t have a format handy, find a template that you like and use that.
Putting off invoicing hurts your bottom line because it often means you get paid later than you otherwise might have gotten paid. It’s also easier to overlook outstanding invoicing if the actual work happened a while ago.
Are you looking for more tips on managing your business finances? Check out the posts over in our Business section.