Every moving part of your business is important. Getting leads, marketing, creating quotes, getting jobs and repeat customers. If there’s one thing you want to get right once your work is done, it’s an invoice.
The Importance of Invoicing
Invoicing is your bread and butter business process. By the time you’re ready to produce an invoice, you’ll have covered what your customer needs, what you can do for them, and given them an estimate and a quote with the costs clearly listed.
Consistent and effective invoicing is necessary for keeping your business steady and growing. If there’s ever a problem with your business cash flow, check your invoicing system is watertight first.
This seems like an obvious thing to say, but an invoice isn’t just the way you get paid for your work! It’s another opportunity for you to show your customers that your business is running smoothly and professionally. An invoice can say a lot about your business to a customer, and the process of handling invoices can make a lasting impression on customers.
With consistent invoice practices, you’ll be able to keep track of settled accounts, due or overdue bills and track your money flow. With documentation on hand, you can better track your income and review your pricing. This kind of stuff is key in making sure your business has a solid foundation to grow.
In this article, we’ll cover where to start before making an invoice, what you need to include and ultimately how to make an invoice.
Before You Start
When you’re starting your business and reading articles like this one for invoice examples, you’ll need to have a few things ready to go. You'll need a business bank account, a chosen payment system you’ll use, as well as the method you’ll use to log customer details and keep track of who has and hasn’t paid.
A business bank account ensures all your business-related finances are in the right place. It makes accounting and tracking your income easier, and banks offer accounts tailored for businesses.
Payment systems and a document listing payment terms is vital for your business income. You want to make it as easy as possible to get paid and for your customers to pay you.
Your payment system is up to you and what works best for your business. If you decide to accept cash/checks, bank transfers or digital payment methods, you’ll want to have it in place first and foremost.
Before you sit down to make an invoice template, have the terms ready to go. These terms should include the due date of an invoice, how the customer can pay and what they need to do for each kind of payment. The terms also need to include what happens if an invoice is overdue, such as charging late fees.
The clearer it is, the better. AroFlo’s article on payment policies can get you started on what you need to do before you begin taking jobs.
Customer accounts will make it easier to streamline invoices, especially for returning customers. Having the details readily available means you can produce invoices efficiently, and keeping accounts of who has and hasn’t paid ensures you can chase down any outstanding bills.
What You Should Include When Making an Invoice Template
There are a few basic requirements every invoice should follow so that you can give all the necessary information. When making an invoice template and filling out your invoices, make sure these things are present.
- Your business/trading name and logo. Your logo does a lot of the heavy lifting when representing your business, so you want to ensure that it’s there.
- Your Australian Business Number
- Descriptions/Information about the service rendered. This includes the labour and materials used for the particular job.
- The invoice date of issue
- The invoice number
- How a customer can make a payment
- When the payment is due
- The terms for overdue payments
If you are registered for GST and making an invoice template, there are guidelines you must include:
- The heading ‘Tax Invoice’
- The GST amounts for each item or in total. You only need to list GST for each item if the amount of the invoice exceeds $1000, if it doesn’t, you can put the total amount at the end of the invoice.
If you’re just starting your business, you might not yet need to register for GST. The threshold is $75,000 annually – if your business is on track to earn more than that, you should consider looking into the process of registering. The last thing you want is to pay fines on your hard-earned income!
Types of Invoices
There are a few types of invoices you’ll need to consider when making an invoice template. The type depends on the job and what you and your customer have agreed to.
Standard Invoices
These are the normal, one-off invoices given for one-time work and services. Typically issued for smaller jobs that won’t take an extended amount of time or resources.
Progress Invoices
These are invoices made for longer-term work and jobs, where it is practical and necessary for payment to be made in increments. You and your client will need to discuss the terms of a progress invoice and what is expected for each one. The timing of an invoice and percentage of the total needs to be agreed on before starting, to cover yourself and keep things clear between you and your customer. A progress invoice should include the percentage already paid alongside the due payment as well as any changes or additions.
Recurring Invoices
These invoices are usually used for regular maintenance jobs where your business has agreed to repeat work at a particular time. Any changes to the costs involved should be reflected in the invoice.
Creating an Invoice
Invoice templates can come in many styles, shapes and colours. When considering how to make an invoice, you can think about how you want it to look. With online invoicing templates and designs, it’s easier than ever to find one that fits your needs or create your own.
That’s not to dismiss the classic carbon paper invoice or quote, where you can give someone a hard copy on the spot while keeping the original. Paper invoices are still useful! Lots of clients and customers will feel more comfortable getting a hard copy of their invoice, and when considering invoice examples, keep them to a printable layout to make it easier for you and your customers.
Digital invoicing has many benefits. It allows your business to issue invoices quickly and directly to the customer, reduces the costs of postage and printing, and reduces physical paperwork and clutter. Digital invoice templates are easy to find and customise and can be integrated with other digital paperwork services.
A big positive to invoicing now is choice. You can offer your clients digital or hard copy invoices (or both) so they are confident that they have the info readily available. If a client misplaces a hard copy, they don’t need to stress, and it won’t take extra time for your business to be paid.
Your invoice can be as detailed or as simplistic as you like, as long as you include the requirements listed above and make it clear what the invoice covers.
It’s easy to create invoices online or find templates you like. Some sites offer free templates and others offer paid services to design a template for you. Whatever you’re looking for, there’s a fit.
Our Software Picks for Creating Invoice Templates
Microsoft Word
Invoices are simple to whip up in Microsoft Word, especially if you’re just starting. Microsoft Create offers various templates for all kinds of invoices. These templates are customisable in Word and do need work to conform to Australian requirements.
Canva
Canva has a wide variety of templates for any business and are highly customisable. To use and save projects on Canva requires an account, and some templates require payment to the designer. This is another good option for ideas for layouts of invoice templates and a jumping-off point for new invoice designs.
AroFlo
AroFlo’s tradie software covers everything you need to create, manage and send invoices to customers. It can all be done on your devices, which can make it easier to prepare invoices on the go and track your accounts. AroFlo is everything you need from a software package, and you can get a free demo right now. But for those wanting to jump right in, we offer a 14-day free trial of our AroFlo GO software for smaller businesses.
Streamlining Invoices
Invoices can be tricky to get right and keep track of. The more your business grows, the more paperwork you’ll receive, and the harder it is to keep a handle on your accounting and cash flow.
The last thing you want is to let invoices and payments slip through the cracks and for you to lose out on a job.
Making an invoice is just the first step. As you get more customers, you’ll need ways to streamline the process so customers get the correct invoices sooner and you get paid on time. And hey, you know your business is on the right track when you get to that point!
Need more info on invoicing software to start streamlining your payments? Our Top-Rated Invoicing Software for Tradies article has everything you need to start.
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