How automated invoicing can help your business
Invoicing can be a tedious task for small businesses, but there are ways that you can automate your processes to make invoicing quicker and more efficient.
Many freelancers and small business owners opt to use Word and Excel invoice templates which require lots of manual entry. Others prefer to use invoicing software which is specifically designed for creating professional compliant invoices and can help automate the fields and reconciliation for you.
This article explains what invoice automation is and how it can help your business save time and money on creating sales documentation.
Automated invoicing uses technology to automatically generate and fill in your outgoing invoices, as well as check and sort your incoming invoices. Invoice automation can also automatically match your invoices with payments.
The alternative is manual invoicing which requires the business to write all of the invoice fields manually and spend additional time matching payments to invoices. If your business issues a lot of invoices, this process can be tedious and time-consuming.
There are many benefits to invoice automation compared to manual invoicing. The main areas in which automation can benefit your business include:
Save time and money: Invoice automation can help you create invoices quickly while ensuring that the invoice is compliant and correct. This speeds up the process of creating your sales documents and minimises the possibility of mistakes.
Quicker payments: The quicker you can create and issue an invoice, the quicker you’ll receive payment. Invoice automation can also simplify the payment process by automatically taking payment (for instance, direct debit), or by including a payment link directly on your invoice.
Increased productivity: Spending less time on tedious paperwork will increase your productivity levels and give you more time to focus on other aspects of your business.
Less chance of errors: With manual invoice processing, there’s much more room for error. Fixing these errors can be costly and disrupt your cash flow. Invoice automation can ensure that your invoices are compliant and check for inconsistencies and duplicates.
Invoice automation can include a variety of different features that each simplify a different aspect of your invoicing and accounting. Not all invoicing software will include all of the following automation features, so you should decide which features are most important to your business.
Some examples of invoice automation features include:
Automatic reconciliation: Reconciliation is the process of matching incoming and outgoing payments against your invoice and expense documents. It’s important for making sure that your records are correct and complete. Automatic reconciliation eliminates the manual aspect and automatically matches your transactions to their corresponding income or expense.
Optical character recognition (OCR): OCR technology automatically recognises and extracts data from images. For instance, if you take a picture of a receipt, OCR can convert the data into text and record it as an expense in your accounting software.
Machine learning (ML): Machine learning is using computer algorithms to adapt and learn over time. An example of machine learning in invoicing is how the system can automatically generate your invoice numbers in the correct sequence and ensure that there are no gaps or repeated numbers.
Recurring invoices: Creating recurring invoices for recurring sales can save you tons of time. Most invoicing software will include an option to automatically create and issue invoices to a customer according to a set schedule of your choice.
Automatic payments: Invoice automation not only speeds up your invoicing but can also speed up your payments. Including an online payment link on your invoice or offering direct debit payments can improve your cash flow.
Automatic reminders: Chasing up payments for overdue invoices can cost a lot of time and money. Setting up automatic payment reminders can help to remind your customer about the invoice and help you get paid faster.
Invoice automation may seem complex, but it ultimately simplifies your invoice processing.
As an example, you have a new customer who will pay the same amount monthly for your services. You set up recurring invoices to be created and sent to the customer automatically on the same day each month. At the same time, you also set up direct debit payments so the payments automatically come out of the customer’s bank account on the same day each month.
As soon as payment has been received, your invoicing software automatically matches the payment with the corresponding invoice. It’s reconciled for your accounting records.
Therefore, once set up, the invoices are created and sent, and payments are taken and reconciled - all automatically. In this way, the invoicing process can happen without the need for manual work, allowing you to focus on other tasks that will grow your business.
SumUp Invoices is invoicing software that can help you create and issue invoices quickly and accurately. You can upload a list of products and customers for quick selection on our pre-made invoice template.
The software ensures that your invoice includes all of the mandatory invoice fields prior to sending it to your customer. You can also automatically include a payment link on the invoice so your customer can pay instantly online.
Once payment has been received, it will automatically be matched and reconciled with your invoice, without you having to lift a finger. Therefore, it could only take you one minute of actual work to issue an invoice, receive payment, and match the payment with the invoice.