Until six months ago, web designer Jim Stone used a manual invoicing process for his business Blarney Stone.
HIs ever-reliable bookkeeper printed them from Quickbooks and sent them
out via snail mail. As Jim puts it, this was a case of "if it ain't
broke, don't fix it".
But
when his bookkeeper took on an major new role elsewhere, Jim saw the
opportunity to try a different approach: "as a web designer, my clients
expect technology solutions from me. Yet I was sending out stamped
mailed paper invoices"
Jim
had tried several other invoicing systems in the past - but some were
complex and cumbersome, and others too basic. What he needed was
something that could handle recurring monthly and quarterly invoices,
allow clients to check their own balances, and generate email reminders
for slow payers. Eventually, through an internet forum, he came across
an online invoicing system called Freshbooks which "provided most of the solutions I needed at a very affordable cost".
Now,
all of Jim's clients now get invoices automatically emailed to them,
plus a friendly reminder on the due date. If they are 2 weeks late, a
new reminder is sent. And if they delay for another 2 weeks, a payment
demand notice is automatically generated and sent. According to Jim, "I
have worded the reminders so clients know they are automatically
generated so there is no personal affront... my automated system is
reminding and then hounding -- I'm not."
The net result: a big reduction in overdue invoices and 2-3 hours less bookkeeping per month.
Compared
to his manual process of one year ago, Jim says that 31-90 day invoices
have dropped from 26% of the total to only 12%, with the current 30
days balance going up accordingly. Jim saw no change in the over 90
days balance, which "tells me that the real slow payers are always
going to be slow payers, but the marginal payers benefit from
consistent emailed reminders".
So,
if your business could do with improved cash flow, maybe it is time to
implement automatic payment reminders (and consider moving to new
software if necessary to enable the process).
(Note:
SoftwareShortlist.com's free recommendation and comparison service does
not currently include invoicing software ... but rest assured it is a
software category we will cover in the future!) |
