How To Make An Invoice

Keep Proper Records For Your Business: Learn How To Make Invoices

Invoice Drafting 101

Learning how to properly draft and file your invoices is crucial to the success of any business. Invoices help you track work orders; including purchase dates, due dates, and agreed payment. Without a proper invoicing system, it’ll be difficult for you to keep an eye on the cash flow of your business. You’ll struggle with collection and you can easily misplace vital client details.

Invoices are so important, but small business owners often make very basic mistakes when drafting them. So what exactly does a complete invoice require? Keep reading for our fool-proof guide on how to make the perfect invoice!

What Is An Invoice?

An invoice is a simple document that a seller will give to a buyer. This document is proof that they were hired to provide certain goods or services in exchange for a certain amount of money, due on a specified date. Most invoices will include details on the quantity or quality of what was delivered and any terms of payment agreed upon.

Invoices are used as proof of billing, and they’re official commercial documents. They’re always given by the seller after delivery of the service or goods. They’re not the same as purchase orders, as those documents are issued before completion of an order by the seller.

Do I Really Need To Have Invoices?

Yes. Let’s say you don’t want to be bothered to go through the problem of drafting an official set of company invoices. After all, just writing it down in a notebook should be the same thing, right?

You could do this, but there are cases where issues arise about the terms of the job, or you may misplace that little scrap you wrote the details on. It’ll be a nightmare to sort out payment terms and conditions if you don’t have an official document to reference. No proper billing system means it’ll be that much harder to collect from people too. While most clients will be honest and will pay up with a gentle nudge, imagine trying to get paid if you’re dealing with a bad apple who knows you don’t keep official records!

Internal finances are best sorted out with invoices. They’re also a way for you to keep a close eye on due orders and to track your own deadlines for work. They’re an indicator of how much cash will be coming into your business on the specified date, so you can monitor your bottomline. Every business needs an invoicing system –  this can’t be stressed enough!

How Do I Make An Invoice?

To create the ideal invoice, you always need to include the following elements. Remember that an invoice doubles as a form of advertisement for your business, so it has to be typo-free, neat, and professional in appearance!

1. The Company Logo

If you have a company logo, make your invoice more distinctive by placing it prominently at the top. This creates good recall for customers and helps them keep you in mind in case they need to hire someone for future jobs.

2. The Seller’s Name, Contact Details, And Address

Your full name or company name should always be on the invoice. You should also include your official site, contact numbers, email addresses, and your business address. Putting complete details will make it easier for customers to reach you if they want to make modifications to their orders or if they have other urgent concerns.

3. The Buyer’s Name, Contact Details, And Address

Always indicate the client’s name, email address, phone numbers, and physical address. This will make contacting them a snap if you have any additional concerns about the order, or if you need to send reminders that payment is about to be due.

4. The Due Date For The Order

Even if you note the due date per order in your books, it’s vital that you indicate the date for collecting payment on your invoices. Apart from the due date itself, you should note if there’s a grace period for repayment wherein your customers can pay without incurring any penalty fees for being late.

5. A Description Of The Job Performed

Every invoice should contain a list of what you did for your client so they know exactly what they’re paying for. Apart from listing the quantity of work done, it’s good to include a description of what you delivered so they’re aware what order you are referring to. For example: if you are a freelance photographer, indicate how many edited shots you sent, and the kind of editing you did to them. If you are an SEO article writer, indicate the title of the article you wrote.

Apart from a description of the order, you need to indicate the subtotal per item delivered. This is for transparency: it basically assures the client that they are paying for a specified item and that you’re not arbitrarily tacking on charges.

6. The Total Payment Due

Even if you have the subtotal per item delivered, your invoices should have the final total. This allows you to double-check if you’re made a mistake in the amount charged.

7. Terms And Conditions Of Repayment

If payment is done by installments, your invoice needs to indicate how many and when each is due. If you only allow for specific methods of repayment, such as bank deposits or check deliveries, that needs to be indicated as well. Always indicate the currency for payment, because you may have to deal with conversion loss if you’re dealing with international clients!

If you charge late fees for overdue payments, the penalty sum due or percentage to be paid needs to be indicated. Terms for early repayment and discounting should also be in your invoice. Keep it brief. If the terms are too long, indicate that the terms for penalties and early payment are the same as those in the contract signed on the specified date.

8. A Distinct Invoice Number

Every invoice should have a unique number that allows you to distinguish one order for a client from another. It’s easy to come up with your own numbering system: it can be as elaborate as having a separate alphabetical code for repeat clients, or as basic as 123, 124, 125 and so on. What’s important is that no two invoices have the same number.

Invoice Creation Is A Snap With The Right Tools

If you’re worried that you’ll miss any of these vital elements, or you just don’t have a lot of time on your hands to make an invoice from scratch, there’s plenty of online resources to help you out. The Free Invoice Generator is a great site that can help you put together a customized invoice for your business, and you can make and download one for free! Apart from the handy template creator, we also have a wide variety of invoice templates you can customize. It can help you create invoices, send them out, monitor due dates for collection, and collect payment through approved methods. It’s a solution that will save you a lot of time, stress, and money.

Staff Member


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