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For any B2B business, billing is one of the most significant practices. This is what keeps your cash flowing and your finances healthy. There is a plethora of invoicing practices, and choosing the right one may be overwhelming for your small business. This is why you need to do thorough research, set clear goals, and build a solid billing strategy that will work for both you and your clients.
Here are a few practices that may help you.
B2B businesses that accept electronic payments for their clients need to make the safety of their clients’ sensitive data their priority.
First, you need to check your payment processor and see whether it is compliant with the PCI (Payment Card Industry) data security standard. Second, you need to move from HTTP to HTTPS. Google has already started marking HTTP sites with a red padlock and the jarring “Not Secure” sign. Plus, HTTPS offers an additional layer of protection and encryption. So, even if hackers intercept your client’s data, they won’t be able to decrypt it.
Not complying with these standards may hurt your business on multiple levels. Just imagine what would happen if you got hacked. Apart from the high costs of recovering from a cyberattack, your reputation would be ruined. Once their data gets compromised, your clients won’t trust you anymore and will likely leave you for your competitors.
You need to decide on how you want to organize your bookkeeping processes. The first option is, of course, hiring an in-house accounting team. This way, you will have professionals do the bookkeeping for you, while you can focus on other aspects of your job. The only problem with this idea is the fact that for the majority of small B2B companies, especially those that are just starting out, hiring full stack accountants is too expensive.
Luckily, with the rise of highly sophisticated online bookkeeping platforms, you can now automate your billing processes. Instead of dealing with mountains of paper timesheets, entering a bunch of data in Excel tables, and checking your numbers manually, you can simply rely on software to do all that for you. Apart from saving a lot of time, digitizing bookkeeping will make this process fully transparent, easy to track, as well as remove the risk of human error.
When creating an effective billing system, keep your clients’ expectations and preferences in mind. You need to make the invoicing and billing processes as pleasant as possible for them. For starters, consider migrating from paper to online invoicing.
Apart from eating up lots of your time, paper invoicing costs more and hurts both your professional look and relationships with clients. Just like you, the business owners you collaborate with have numerous obligations hanging over their heads, and it’s difficult for them to keep track of all those paper invoices and deadlines effectively.
This is where online invoicing and billing shine. Some of its major benefits are:
One of the major problems small businesses face is late payments. This is usually the result of poor business-client communication. To avoid such problems, you first need to set clear payment rules that will meet the needs of both parties. Most importantly, you should go above and beyond to build and nourish fully transparent relationships with your trusted clients.
To get your clients to take you seriously, you need to set some strict invoicing rules they need to follow. Otherwise, they will make payments whenever and however they want. This is why you need to have a long talk with your client and create a detailed billing framework that works for both parties. This could be, for example, a contract that ensures that the payment terms are respected and that everyone is on the same page.
Here are a few incredibly important factors you need to include in your contract in order to avoid miscommunication:
No matter how busy you are, you need to deliver your invoices on time. By procrastinating, you’re actually telling your clients that you don’t care about when and how you will get paid. Unsurprisingly, you may end up waiting to be compensated for your work for a few months. Sending the invoice immediately is a bold move that shows you appreciate punctuality and that you are highly professional.
This is definitely your least favorite aspect of your communication with a client, but it is a necessity. Sometimes, your clients will simply forget to send you the money and they need to be reminded to do so. Of course, you need to mind your tone. Be as pleasant as possible in order to solve the problem effectively and maintain solid relationships with your clients.
You could start by sending a polite email reminder. If you notice that the client is not answering, you could simply set up a call or a meeting with them to see what the problem is about. In cases when a client is ignoring your emails and calls for months or even weeks, you should consider taking legal action. If you created a thorough contract and your client signed it, the court should rule in your favor.
As the rebilling process may cost you time and money, you should consider automating it. Billing platforms using a direct debit system can offer failed payment handling services, which include rebilling a customer that had previously failed to carry out the transaction. For you, this means monitoring failed payment transactions in real time and tailoring your rebilling processes to your business’s needs. On the other hand, your customer is given the opportunity to identify the cause of failed payment and take immediate steps to resolve the problem fast.
No matter how tedious it may seem to you right now, creating a solid billing system will help you protect your interests and get compensated for your hard work. Most importantly, it allows you to create highly transparent relationships with your clients, where they’ll know exactly what to expect from you. This is the key to boosting their satisfaction and inspiring them to stay loyal to you.