Why online invoices are great for business

Oct 02 2019 | PayPal editorial staff | 4 min read

The most valuable resources you have as a small business are time and effort. One thing that can help you be more efficient is the ability to quickly create, send and save electronic invoices. It’s a simple but powerful tool.
Almost all businesses need to invoice someone for something. An invoice is the way we confirm to our customers that we’ve performed a service or shipped a product, and they now owe us money. In the past few years, more business owners have started ditching the humble paper invoice in favour of digital ones.*
 

So what is online invoicing?

Online invoicing, e-invoicing or electronic invoicing, is a digital invoice that can be sent once or automated for regular customers. It can be a big time saver for businesses that rely on it for processing accounts payable, and many find online invoicing can even help with things like compliance.

40% of merchants have used their mobile to send an online invoice at one time or another
 

Online vs paper invoicing

Online invoices are the same as traditional, paper ones. They include all the same information – from the customer’s invoicing and shipping/service address to details like services performed or products sold, dates, pricing, GST, quantities, descriptions, invoice numbers, purchase order numbers and your ABN. It’s all there. Except it’s not in physical form. It’s online or even cloud-based. And we can reap benefits from an easy-to-use digital invoicing solution.
 

Four ways an online invoicing solution transforms business

1. Data entry from anywhere

Thanks to mobile innovations, business owners have seen their lives and companies transformed. You can now communicate, collaborate, automate, administer and operate your business from wherever you are and whenever you want. You can leverage your mobile, tablet and laptop to get alerts, updates, reports, notifications and other information to help you run your business. But to get data out of your system, it’s important to integrate it into the system.

In the world of paper invoicing, you’re manually entering information from timesheets and orders into accounting software, then printing and mailing invoices. There’s a margin for human error. With online invoicing, when you perform a service, you can automatically generate an invoice.
 

2. Improved cashflow.

Time directly affects cashflow. When you’re working on paper, there’s often time between performing the service and invoicing the account payable, time between issuing the invoice and the client receiving it, and then further time before you add the details to your invoice tracker. And if you don’t have an invoice tracker, the outstanding amounts due are all in your head.

With online invoicing, you can generate invoices quickly, clients receive them instantly by email, and all outgoing invoices are automatically tracked so you know what’s been billed and when it’s due. And if you use PayPal, your clients can pay with just a few clicks. This cuts your payment processing time way down, improving your cashflow.

78% of PayPal invoices are paid within one day of sending the invoice

Improved productivity

3. Increased productivity

With online invoicing, you can be more productive because you’re getting all your invoicing and payment data when you’re on the go. You enter invoice data into a web-based system without delays and can analyse information end-to-end in real time. And because so much is automated, you can reduce time spent onboarding new employees.
With better data, accessible from anywhere, you can make quicker business decisions and identify potential problems (like an overdue invoice or a more-than-expected bill from a supplier) before they occur.
 

4. A greener alternative

Today, we’re more environmentally conscious than ever, both in life and in business. Printing less paper invoices and storing files electronically goes towards making a difference.
 

PayPal invoicing

When you use PayPal for your online invoices, you can send invoices quickly and for free, and only pay when you get paid. The PayPal Invoicing dashboard acts as your accounts receivable ledger so you can track invoices and payments on the mobile website or with the PayPal Business app.

PayPal Invoicing is flexible to meet your needs. You can create templates and line items to reuse again and again, attach files (like a quote or service agreement), accept partial payments and deposits, send reminders and more. And all your payments are in one place, with data easily exported to Excel or your accounting software.

 
*comScore, based on a survey of 1,226 US and Canadian small- and medium-sized business owners (businesses with fewer than 250 employees and annual revenue of $25K to $5M). December 2017. 320 of surveyed businesses are currently using PayPal.

The contents of this site are provided for informational purposes only. The information in this article does not constitute legal, financial, IT, business or investment advice of any kind and is not a substitute for any professional advice. You should always obtain independent, professional accounting, financial, IT and legal advice before making any business decision.
The contents of this site are provided for informational purposes only. The information in this article does not constitute legal, financial, IT, business or investment advice of any kind and is not a substitute for any professional advice. You should always obtain independent, professional accounting, financial, IT and legal advice before making any business decision.