Cloud accounting firm Xero Ltd has launched a Small Business Guide for invoicing and payments based on input from almost 1400 Xero community members. The company has also analysed over 12 million invoices to identify the average days it takes to pay an invoice relative to the payment terms offered.
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Xero General Manager Marketing Paula Jackson says “We understand the importance to small business of getting paid in a timely fashion. Cash flow is crucial. As a leader in Cloud accounting we are in a position to help small business to understand how to improve their invoicing strategy.”
The community input and invoice analysis have been combined together in an infographic resource that also includes a quiz to get small business people actively thinking about their approach.
The analysis shows that on average debtors pay two weeks late regardless of payment terms, and on average if they wish to get paid in thirty days they need to make payment terms 13 days or less.
Key tips for invoicing include discussing payment terms at the outset of a deal, keeping detailed records of inventory and time, setting appropriate payment terms, addressing the invoice to the actual person paying, immediate invoicing, and having a system of reminders and follow-ups.