Why e-invoicing solutions are great for businesses.
What is e-invoicing?
Almost all businesses need to invoice someone for something. An invoice is the way we confirm to our customers that we performed a service or shipped a product, and now they owe us money. But in just the past few years, more business owners have started ditching the humble paper invoice in favour of digital invoices.1
E-invoicing vs paper invoicing.
Today's e-invoice is no different than the traditional, paper ones. It includes all the same information - from the customer's invoicing and shipping/service address to details like services performed (or products sold), pricing, quantities, descriptions, invoice number, purchase order numbers, the salesperson's identifier, and dates. It's all there. Except it's not in physical form. It's online. And we can reap benefits from going digital.
Four ways an e-invoicing solution has transformed my business.
1. We now do data entry from nearly anywhere.
Thanks to mobile innovations, business owners like myself have seen our lives, and our companies, transformed. Now we can communicate, collaborate, administer, and operate our businesses from wherever we are and whenever we want. I've learned from my best clients to leverage my mobile devices - phone, tablet, laptop - to get alerts, updates, reports, notifications, and other information to help me run my business - whether I'm in the office or on the road. But to get that data out of my system it was also important to get it into the system.
Back in the day, we would finish work for the week and my people would submit manual time sheets. Someone in my office would manually enter that information into the computer, and then print and mail invoices. Now, when we perform a service, I authorize certain technicians to automatically generate an invoice at the client’s site – whether they’re in their car or walking down the street. It's had a huge impact on our productivity.
2. Our cash flow has significantly improved.
Time directly affects cash flow. Before we moved to an e-invoicing solution, days or weeks passed between the time we performed the service and invoiced the customer. Now, as mentioned above, we're doing our data entry from our mobile devices, so we’re generating e-invoices as quickly as the service is performed. More importantly, we email the invoice immediately so that clients have it quickly, instead of waiting days for the post office to deliver it.
Speaking of saving costs, our e-invoices include PayPal as a payment option, so our clients can immediately pay us with just a few clicks.
Think about that: with the little change to e-invoicing we cut our payment process by weeks - and significantly impacted our cash flow.
3. Besides cash flow, e-invoicing makes us more productive.
That's because we're all getting our invoicing and payment data while we're on the go. We're entering this data into the system without delays. We're analyzing information in almost real time. This has enabled me to make quicker decisions and identify potential problems (an overdue invoice, a less-than-expected billing) before they occur.
4. It’s also a greener alternative.
Being an environmentally conscious company is important. Printing less paper invoices and storing our files electronically enables me to tell the world that we're doing our little part to try and make that difference.
As far as einvoicing options, we decided to use PayPal Invoicing.
There are many great e-invoicing applications to choose from. We use PayPal Invoicing for a few reasons.
For starters, cost. PayPal invoice templates are free and the transaction fee we pay on payment is no different than what we've paid in the past when accepting credit cards. We use the PayPal Invoicing management centre as our accounts receivable ledger, so we can track invoices and payments on the go. I also like the flexibility of PayPal invoice templates and the options to attach files - like a quote or service agreement - when we need to.
Great e-invoicing solutions do this. They allow companies to accept partial payments and deposits, send out reminders, retrieve a complete history, accept payments in different currencies, and even share the invoice as a PDF. PayPal Invoicing also gives me the ability to integrate with other systems and output to Microsoft Excel.
My advice: If you run a business, turn your manual processes – like invoicing – digital. Believe me, your competitors are doing this. You need to as well.
1 Source: comScore, based on a survey of 1,226 US and Canadian small- and medium–sized business owners (businesses with <250 employees and annual revenue of $25K to $5M), December 2017. 320 of surveyed businesses are currently using PayPal.