Author: Marjan Nikolovski

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Stay in the loop with the Action Center

In Envoice we have several ways to inform you about your latest activities regarding your invoices. In case you’ve missed out our emails and SMS messages, you can always return to the action center to find out the latest activities for all of your invoices.

You will be notified of the following events when an invoice has been:

  • Created;
  • Set as draft;
  • Duplicated;
  • Sent to the client via email;
  • Sent to the client via SMS;
  • Sent to you via email;
  • Sent to you via SMS;
  • Opened by the client;
  • Viewed by the client;
  • Rejected by your client;
  • Updated;
  • Marked by you or paid by your client;
  • Marked as unpaid by you;
  • Marked as overdue;
  • Paid on PayPal;
  • Paid on Stripe;
  • Sent to your accountant;
  • Downloaded as PDF by your client;

If you’ve already got exhausted from reading the list, don’t worry you will learn them on the way. You just need to focus on your business and let us do the rest.

Rule number 1 to have a flawless collaboration with your accountants

Accountants are one of the most important professionals you will want to have on your side.

They are the ones who handle your finances, calculate your taxes and creating financial cards. Or in other words taking care of your numbers and how your business is doing.

As such it is of big importance to keep them in the loop, notified about your earnings and expenses.

If you are a type of person who forgets to send his invoices on regular basis now that can all be changed with Envoice. Select your invoice and click send to the accountant.

Make your accountant happy and updated.

Save time with duplicated invoices

If you ever tried to maintain your invoices manually in Word, you have definitively tried to copy-paste your previous invoices from your long-term client, creating duplicated invoices. We used to do that as well.

With this approach, there is one downside… – We can easily end up sending an invoice some incorrect information it:

  • Wrong Invoice Number;
  • Wrong Issue Date;
  • Wrong Due date;
  • Wrong P.O number;
  • Wrong Price;

Having an app to cross-validate this for you can be very helpful. In Envoice we take an existing invoice and prepare all of this information for you. It is easy as Duplicate -> Send.

Envoice-All-Status

In the past, we’ve used to create our invoices in Word and manage them in Excel. It was quite a big challenge to have everything up to date. Since this required us to manually update our Excel file in order to know which invoices were paid, unpaid or overdue.

Anyhow knowing your invoice status will allow you to be proactive. Especially when some of your invoices are unpaid or overdue.

What are the commonly used statutes that we need to care about:
– Draft – indicates that the invoice is still work in progress and is hasn’t been sent to the client;
– Unpaid – the invoice has been sent to the client and we are waiting for the client to pay the invoice;
– Paid – our invoice has been paid by our client;
– Overdue – our invoice has not been paid and that the due date for paying has passed. This means that we should remind our client to pay his invoice;

Finally, having a correct status for your invoices will help you understand your financial condition. Since it is different between how much money you have in your pockets vs how much you should have in your pockets.

Envoice-Terms-Notes

 

Terms

Invoice terms are your request until when you would like your invoice to be paid.

As we’ve discussed in the previous post there is a different type of agreements related to the payment:

 

Net monthly account Payment due on last day of the month following the one in which the invoice is dated
PIA Payment in advance
Net 7 Payment seven days after invoice date
Net 10 Payment ten days after invoice date
Net 30 Payment 30 days after invoice date
Net 60 Payment 60 days after invoice date
Net 90 Payment 90 days after invoice date
EOM End of month
21 MFI 21st of the month following invoice date
1% 10 Net 30 1% discount if payment received within ten days otherwise payment 30 days after invoice date
COD Cash on delivery
Cash account Account conducted on a cash basis, no credit
Letter of credit A documentary credit confirmed by a bank, often used for export
Bill of exchange A promise to pay at a later date, usually supported by a bank
CND Cash next delivery
CBS Cash before shipment
CIA Cash in advance
CWO Cash with order
1MD Monthly credit payment of a full month’s supply
2MD As above plus an extra calendar month
Contra Payment from the customer offset against the value of supplies purchased from the customer
Stage payment Payment of agreed amounts at stage

 

Example: “Net 15 – Payment fifteen days after invoice date.”

Notes

Invoice notes let you add additional contextual notes to the invoices. They are used to add additional clarification or simply to add a thank you message to the client.

Example: “Thank you for your business. It is our pleasure to work with you. Look forward to working with you again soon!”

Envoice-items-table

In this section of the invoice, we want to explain to the customer what they are going to pay us for.

If we agreed to work with our client on an hourly basis, in that case under quantity we will add the total amount of hours that we’ve used to finish our tasks.

 

ITEM PRICE QTY/HOURS TAX
Mobile application development 100 100 10%
For sprint 6 we’ve developed user registration with Facebook and Twitter
AMOUNT BEFORE TAX: 10000 EUR
TAX AMOUNT: 1000 EUR
TOTAL: 11000 EUR

 

If we agreed to work with our client on a project basis, in that case under quantity we will add the project itself or all of the tasks.

 

ITEM PRICE QTY/HOURS TAX
Mobile application development 10000 1 10%
We’ve developed a puzzle game for iPhone.
AMOUNT BEFORE TAX: 10000 EUR
TAX AMOUNT: 1000 EUR
TOTAL: 11000 EUR

 

To avoid confusion, try to be detailed and transparent with the item descriptions. Clients will truly appreciate your honesty.

Before creating an invoice for your client, he will need to provide you with the following information:

  • Name (can be the name of the individual or the name of the company);
  • Email address;
  • Business address or address of residence;
  • Country of residence;
  • Currency which you’ve previously agreed upon;
  • Phone number (It is mandatory in some countries);
  • VAT number (It is mandatory in some countries);

Why having all this information is important for you and your clients?

Your clients will need to satisfy the financial regulations of his country of operation. On the other hand, you will need to have this information so it will be easier for you to get in touch with the client going further.

Keeping his email, phone number and address will enable you to communicate your client in a different way. Especially if you know his address you can always surprise him with a present for your successful collaboration.

Your details on the invoices should provide answers to the customer on the following questions:

  • Who is the person I am going to send the money to?
  • How can I get in touch with this person?
  • What are the bank account details where the funds will be transferred to?

To sum it up the essential information would be:

  • Your name;
  • Address;
  • Phone number;
  • Your email;

If the client is from the same state, in that case, it would be enough to provide him with:

  • Name of your bank;
  • Your bank account number;

On the other hand, if your client is from a different country then you will have to provide him with:

  • Name of your bank;
  • IBAN/National Bank ID (international bank account number);
  • SWIFT code (international bank code);

Eventually, we are happy to live in a very technological advanced era where online payments are accessible to us. You can always use PayPal, Stripe, Payoneer or any other online payment processor to get paid.

Envoice-lightbulb

Invoice number

The first question we’ve had when we were about to create our first invoice was:

Hey, what number should I use on the invoice?

 

We’ve read the local finance regulations, discussed with the accountant, looked on the internet and eventually it turned out to be really simple.

Any increasing sequence would work.

Some example that would work for you:

  • INV-0000X
  • INV-0000X/YY
  • INV-0000X/YY
  • INV-YYYY-MM-DD-000X

Due date

Once you figure out the sequence, eventually you will want to document until when this invoice should be paid. Due by should be set to the appropriate agreed between you and your client, date.

The sooner the better, but if you are not sure to feel free to use Net D approach:

  • Net 10;
  • Net 15;
  • Net 30;
  • Net 60;

This means that your invoice should be paid after 10, 15, 30 or 60 days respectively.

Issue date

This date represents when the invoice has been issued to the client. Usually, it represents the same date when the invoice will be created and send to the client. In case you need to create an invoice in the past or the future you can always change the issue date to whatever date it suits you.

P.O Number

When you will be working with FORTUNE 1000 companies, you will find the Purchase Order Number useful. Most of the big companies out there will need to authorize the purchase transaction.

As such you will receive unique purchase order number which you will use on your invoice. Your enterprise clients can then connect with their unique P.O number in order for you to get paid.

Envoice-surf

I remember back in the days when we were starting up, we thought that the most important skills that we are ever going to need are the skills that we are going to sell to our clients – and we couldn’t be more wrong about it.

As software developers, we thought that what would matter most will be to deliver a solution which we are going to be proud of. Quality, good experience, high customer satisfaction were the values that we constantly strived to achieve.

Besides our services, we should work together with our clients to help them to recognize our core values. This is part of building our brand and the effect on how others perceive us.

First things first, as freelancers we have to discover the answers to the questions:

  • What we do believe in?
  • When working with a client what is important for us?
  • How do we define a job well done?
  • Why we are doing what we are doing?

Once we discover the answers to these questions we will discover a path which we can work on. We will put all of our effort to build a brand of ourselves on how others are going to perceive us.

As it has been said, the picture is worth 1000 words. It is easier for us, humans to remember a picture rather than words. This is where our personal logo comes into place. It will help our clients, leads, friends to memorize us, our work and what we stand for.