Accounting can become drudgery. But in the decades since the PC was born, accounting software has grown to include more than just accounting.
Invoicing for example. That’s sales. Or at least order-taking. But it is our accounting programs that record these customer transactions.
So, what should we be doing in QuickBooks Online (QBO) that would help us get more money, faster?
Let’s delve into customer transactions a little closer.
You would be amazed how many people pay little or no attention to payment terms for their customers. Sometimes this setting can be so ignored there are no payment terms in the invoice at all. That’s a mistake.
In the invoice shown, a due date, your expectation for payment, is clearly shown. If you can, terms of 15 days might be possible with your customers. If so, use that. The faster cash comes in, the better for your business.
Due Upon Receipt could seem like a setting that would yield the fastest payments of all. Not so. It’s usually impossible and certainly is impractical to pay an invoice immediately, the moment you first see it. So, such terms are generally treated very casually by customers.
You can set default payment terms to show on invoices in Company Settings in QBO. Set the terms most favorable to you that your customers will accept.
If you want to set terms specific for different customers, that option is in the customer setup screen,
Communicate your expectations. If you don’t, your customers aren’t going to care about when you get paid any more than you seem to.
Invoice as soon as possible. Some businesses will wait to the end of the month and invoice all open accounts at once. This is usually a mistake. If you send statements at each month end, send invoices first, as soon as the shipment/work is complete. Then follow-up with the statement as a reminder at month-end.
Send your invoices online. There are a couple of advantages to this. It’s quicker. Email is instant. An invoice emailed from QBO will include a copy of the invoice. If practical, it would be a good idea to include payment expectations in the body of the invoice as well as on the invoice image itself.
Sign up for and include electronic payment options on your invoice. This capability is integrated into QBO. You can receive payment by credit card or bank transfer. Your choice.
When you use electronic payment capabilities, you usually get paid faster. In addition, the funds go directly to your account. No trip to the bank.
Be sure to track invoices and be aware as they become overdue. Send customer reminders. Or, in some instances, you may want to call the customer.
Be professional. Be polite. For most of us, we will make a greater effort for someone likeable rather than someone who is disagreeable.