This article was originally published in The Simplifier #61.

Article: Where the Wild Things Aren’t: Taming the Invoicing Beast

By Shawn Tuttle

The idea of “invoicing clients” is deceptively simple; it is the means to get paid for work you’ve done for a person or business. In reality, without effective systems in place to run your business, invoicing will throw you into an arena filled with snarling beasts. Savages loom, ready to pounce, in the form of self-worth insecurities and confidence issues, holes in your client agreements, and inefficiencies in your tracking systems—all of which you thought were tamed and good-to-go in your new business venture.

Michael Gerber, entrepreneur and author of The E-Myth, sums up the maxim that any business wanting to thrive must follow:

“Systems run the business and people run the systems.”

In addition to laying a solid foundation for growth and avoiding the arena of nasty varmints, good invoicing systems are crucial for maintaining good client relations. They make life much easier for you, too! 

You might think I’m exaggerating the beastliness of the situation, and I may be… but not much. While I’m sure you’ve done great work for your client, presenting them with an unprofessional or delayed invoice can have disastrous effect. If the numbers are inaccurate or don’t match up with expectations, you may be expected to provide information that you didn’t track. If it’s ugly enough, you could lose a payment, a client and a potential source of referrals. Invoicing represents money, and money is a sticky subject.

After all this talk of the brutalities of invoicing, now would be a good time to establish a visual of yourself running your business with the utmost efficiency, triumphing as a glorious beast tamer, and connecting with your inner uber-professional.

Within this vision, you present your clients with accurate time billings and considerate descriptions of how your time was spent. You invoice them according to your agreement with them for rates, billing frequency, payment terms, and any other relevant specifics. You make it easy for them to pay you by making payment details obvious and easy to find. That way your invoice says more than just how much they owe you, it also says: “I appreciate you as a client and want to continue working with you.”

Don’t worry, there is a way to present a polished image while keeping the feisty fiends safely locked away. 

You do so by heeding Michael Gerber’s words to have systems run your business and for you to run the systems. You should have three main systems in place for invoicing in a service-based business:

1. time tracking (discussed below)
2. client agreements (in upcoming article) 
3. the invoice itself (see Anatomy of an Invoice online)

Down the road, these same routines will allow you, the savvy leader of your business, to delegate successfully to others.

Time tracking 
When it’s time to invoice, you need quick and easy access to three pieces of information: what you did, for how long, and for who. Trying to recreate your billable time by digging for scraps of paper and racking your brain to remember what you did a month ago is best left for the Tarzan and Jane entrepreneurs who are still stuck in the jungle with the wild things. 

If you only bill for client appointments that are tracked in your planner, then using a “to bill” code in there might be all you need. To do this, at the end of an appointment or at the end of the day, you’d (1) make sure the billable time is recorded and accurate, and (2) enter a brief description of the appointment in the notes section. 

However, if you are like many service providers who do work for clients on a looser schedule, you’d probably benefit from a time-tracking program. There are numerous programs designed in all shapes and sizes just for this purpose. Be aware that some time-tracking programs are designed to help you examine your schedule for productivity purposes while others are intended mainly for invoicing clients. 

Choosing (and using!) the right program can make time tracking so easy you’ll wonder how you survived in the dark ages up until now. They come with an on-screen stopwatch that you start and stop as you work on different projects. You assign each “time slip” to a client project and include a brief description of what you did. A couple of clicks at billing time creates a formatted invoice ready to submit to your client.

You’ll know when your system is simple and thorough enough when you can easily show someone else how to do it for you.

One more suggestion on invoicing itself: whichever method of time tracking you choose, set deadlines for billing clients. For example, issue monthly invoices by the 5th of the following month. If this is tough for you, schedule an appointment with yourself or give yourself a reward when you finish. Do whatever it takes to make it happen. Besides the fact that your client won’t initiate payment without it, a timely invoice gives you another opportunity to impress them with your professionalism, as well as strengthens your stance for growth. 

Make time tracking and invoicing as easy as possible. It’s an investment that is essential for the success of your business! Take the time to find a method that works well for your situation and stick with it.

Tame the wily beasts of inefficiency; they don’t belong in your successful business. Accurate and timely invoices send a message of consideration to your clients while paving the way for future work. The three components of healthy invoicing are time tracking, the invoice itself, and bright and shiny client agreements (we’ll cover these next issue). Before you know it, you’ll be out of the filthy old arena and into the cosmopolitan cafe, where all the other uber-professionals are hanging out. Let your systems carry the weight of invoicing so that your inner professional can shine! 

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Shawn Tuttle is founder of Project Simplify.