As small business owners, ensuring your clients are making the proper payments on time is a top priority to keep your finances in order. Sometimes, however, this is easier said than done.
On one hand, you may be afraid to chase clients for payment, worried about setting them off, losing their trust and maybe even losing their business. On the other hand, waiting until you’ve completed a job to present the bill can lead to irritated customers or late payments, where you are waiting on the full payment amount for your hard work, which, in some cases, can be a major hit to your business’ finances. After all, without cash flow on hand, your ability to grow as a business suffers. Now, there’s a solution for this recurring issue.
QuickBooks® Online (QBO) now offers a new feature called Progress Invoicing, which is made specifically to solve these types of problems. With this feature, you can essentially set up a payment plan for any given client that begins immediately when you start a new job. This way, you receive a direct portion of the payment, which you can then invest back into your business as you continue to move forward – providing an improvement in general cash flow for your business. If your business is structured in such a way that you require a percentage or partial payment upfront – or perhaps you want to implement this strategy in your invoicing plans – the Progress Invoicing feature should be a necessary instrument in your company tool belt.
Progress Invoicing also acts as a great way to effectively track your progress on any particular job since it enables you to create multiple invoices from any preliminary estimates given to your customer. This is especially helpful if you deal with long-term projects or jobs that require you to work through multiple stages of services.
Still not convinced? Here are some tips and tricks for making the most out of Progress Invoicing.
Lock down your cash flow. Not only does Progress Invoicing ensure overhead costs for a job are covered, but billing clients incrementally also guarantees you always have access to a greater amount of funds necessary to keep your business afloat and grow.
Incentivize your team. Within a small business, you probably have a team working closely with you on these multi-phase projects, ranging anywhere from long-term employees to outside contractors. Progress Invoicing can act as an incentive for those you’re working with.
Rather than waiting to finally get paid at the end of a time-consuming project, you’re all receiving compensation throughout the process. This boosts team morale and works to motivate your employees to increase their efficiency and, therefore, reduces the amount of time or resources that may have been unnecessarily wasted prior to implementing QBO’s Progress Invoicing feature.
Create mutually beneficial relationships. Finding a solution that benefits your clients and your business is always encouraging, and Progress Invoicing does just that. With the proper funds and a motivated team, the job at hand can be finished faster and more effectively, saving both you and your client precious time and resources, because as everyone knows, time is money.
This feature allows for your customers to pay less at a given time, while also preventing your business from the potential stress that comes from dealing with late payments. Because payments are received in increments based off what stage you’ve reached in any particular job, Progress Invoicing also gives you the ability to provide customers with accurate and timely updates, giving your customers more peace of mind.
We’re Here to Help
While this QBO feature can be a productive addition to the structure of your small business, our team at Sound Business Services understands that making changes to your work processes can seem like a daunting challenge. But, don’t worry – we’re here to help you every step of the way.
Incorporating Progress Invoicing is actually a fairly simple process that only takes a few steps to set up. Contact us with any questions you may have about getting started, and let us help you further streamline the structure of your small business.