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CFO Tech Stack: Invoicing

Updated: Apr 14

Welcome to this article's edition of the CFO tech stack: invoicing!


In case you missed last week’s edition on AP software, you can grab that right here.


Today, we’ll discuss a section of your Finance & Accounting tech stack that you won’t want to overlook…sales & invoicing.


There are a lot of options here, so let’s explore them all!


Why you need an invoice - CFO Tech Stack: Invoicing

An employee looking at an invoice - CFO Tech Stack: Invoicing

You’ve got a great business model, and now it’s time to make some money!


Before you can generate income though, you’ll need to figure out a way to send an invoice to a customer and collect on that invoice.


Before we explore a few platform options, let’s discuss the importance of sending out invoices with each sale.


An invoice is a legal document showcasing an amount that a customer owes you - this differs from a bill, which is the opposite of an invoice and instead represents an amount that you owe to a vendor.


Every time you generate income, you should have an invoice generated. This will help you in case you ever undergo an audit, or if a customer ever calls you up and asks about a mysterious charge on their credit card statement.


It’s common for invoices to also include a link to allow customers to pay directly from, making things nice a streamlined.


If you are in a high-volume business, you may not have the option to send out an invoice with each sale, instead, you can send a receipt to a customer with their payment confirmation.


Now that we know about invoices, let’s talk about a few platforms that you can use to send out invoices or receipts to customers.


Sales platforms - CFO Tech Stack: Invoicing

Accounting platforms - CFO Tech Stack: Invoicing

There are many sales platforms out there, each that serves a different purpose.


Let’s explore a few:


Your Accounting Software


Your accounting software is a great place to start, as it limits the amount of “syncs” you need to perform from any external software.


The idea here is simple - each time you have a new sale, you generate an invoice from your accounting software, and send it to the client. This allows your financial statements to be up to date, and to reflect a receivable, as well as an income (or deferred revenue) amount.


QuickBooks online platform - CFO Tech Stack: Invoicing

If you are using QuickBooks Online, it would look something like this:


QuickBooks online invoices example - CFO Tech Stack: Invoicing

QuickBooks Online also has a bulk upload feature where you can populate all of your invoice details directly in Excel, allowing you to stay efficient with your accounting operations.

Shopify & Amazon


Shopify and Amazon logos - CFO Tech Stack: Invoicing

Got an e-commerce site? Shopify is one of the most popular online stores to use to integrate with your offering.


Amazon is another popular service, allowing you to take advantage of fulfillment services directly from their platform.


Stripe


Stripe logo - CFO Tech Stack: Invoicing

One of the most popular sales tools is Stripe, which makes it relatively easy to use custom code to collect payment directly from customers on your website.


Ignition and Plooto


Ignition and Plooto platforms - CFO Tech Stack: Invoicing

If you’re a professional service firm like us, Ignition is a great platform for sending out proposals, collecting signatures, and collecting auto debit payment via ACH or credit card at the time of signing.


Plooto is another great platform for collecting payment from customers on auto-debit via ACH - this helps you save money on those costly credit card fees!


How to keep your receivables balance low - CFO Tech Stack: Invoicing

invoice in receivables - CFO Tech Stack: Invoicing

Sending out an invoice is just one side of the coin - collecting against that invoice is another important aspect not to be overlooked!


In case you missed our earlier series on how to get paid quickly, you can find that over here.


Here’s a recap:


1. Follow up on outstanding balances


Don’t make the mistake of assuming customers will naturally pay on their own. Customers are busy, and they will oftentimes do what they can to hold onto their money as long as they can!


Most invoicing platforms give you the ability to automatically follow up with customers who have outstanding balances - just be sure to reconcile their payments in your accounting software or you may be following up with a customer who has already paid!


2. Collect payments on Auto debit


As we mentioned earlier, collecting payments ahead of sending out an invoice is one of the best ways to reduce the work involved in following up with customers. It also is a great way to reduce the chance of a bad debt


3. Turn off service/threaten legal action


We hope your business never gets to this point - but sometimes, you may have to explore some “not-so-nice” options for collecting against your outstanding balance.


With these options, you can turn off their service, or threaten to send their account to a debt collections agency.


Be sure to try everything you can to keep things amicable before it gets to this point!

 

Sending out invoices and collecting payment from customers is the lifeblood of your cash flows - get it right and you’ll not only get paid quickly, but you’ll save your time while avoiding a headache involved in long and convoluted operations!



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