7 Easy Invoice Mishaps For Businesses To Avoid

Invoices

Business owners know how the invoice process can be fraught with pitfalls that lead to delayed payment, or worse, no payment. Yet invoice mishaps can have bigger implications on the business than you might think.

The average cost of resolving a paper invoice dispute is £12, the typical cost of processing an average invoice £6.60. When 10-40% of all paper invoices issued come into dispute this adds up to a lot of wasted time and expense in finalising them – not to mention the delayed payments. This is time and money that businesses don’t have spare.

Forget hounding people to pay their invoices on time – the mere act of creating and submitting an invoice can lead to drama. Most small business owners know how the invoice process can be fraught with pitfalls that lead to delayed payment, or worse, no payment.

But steering clear of a few simple mistakes can keep everything on time – here are seven blunders to avoid:

1. No Backup System

It’s kind of a no-brainer, but if one computer crashes, all your records are gone. Make sure to back your invoices up on multiple computers – or better yet, store it in the cloud. These are some of the most important documents of your business, after all.

2. Having One Gatekeeper

Don’t give full ownership of this responsibility to just one person – you never know when you’ll need access to the information, and gatekeepers can cause bottlenecks – the last thing you want when you’re trying to get paid.

3. “The Invoice Is In The Mail…”

Unless you’re hand-delivering paper invoices, you can’t confirm receipt unless you’ve paid for FedEx. And snail mail means snail payment…the worst kind. Go online to get paid faster. Companies like Invoice Home make the whole process easier. When you make it easier for companies to pay, you will get paid faster. Our infographic clearly shows just how much paper invoicing costs businesses (and the environment) every year.

4. Forgetting To Invoice Altogether

Admit it – it happens. And that’s money lost. Make sure you have a system in place to help you remember to send out your invoices along with any reminders when they are overdue.

5. Incorrect Currency Conversions

Working with international businesses? A miscalculated currency conversion causes delays at best, and underpayment at worst. Make sure you’re using a system that allows for the most updated conversion rates.

6. Misfiring An Invoice

Ever sent the wrong invoice to the wrong vendor? That can get hairy when you’re sharing confidential pricing matters – and might even hurt negotiations if one vendor sees how much (or little) you’re paying others. Automate your system to avoid the awkward.

7. Doubling Up

Generating duplicate invoice numbers is one of the most common mistakes made. Without a system to prevent dupes, small business owners risk wasting time and money trying to undo the confusion this can create.

In short – invoice mishaps can have bigger implications on your business than you think. Be sure to put systems in place to prevent snafus that cause delays in compensation – the more efficient your invoicing practices, the faster you get paid.

Mikkel Hippe Brun is the Chief Strategy Officer of Tradeshift. Mikkel has long career in IT in both private and public sector. Mikkel was Technical Director of the 30 million Euro PEPPOL project (Pan European Public Procurement Online). He was also CTO and co-founder of Integrator Uniware A/S, a company that developed advanced database publishing and pagination software. Mikkel joined the National IT and Telecom Agency in 2002, initially as an independent consultant, later as Chief Consultant responsible for Danish e-invoicing standards and e-invoicing infrastructure. Mikkel is active in international standardization and was one of the creators of the global XML e-business standard UBL. He holds a MS in Computer Science.

  • Chandra bose

    Thanks for the step by step explanation!