Why Invoices and Statements Are Important | Business Town

Why Invoices and Statements Are Important

Invoicing

Be sure to follow invoicing to the letter of the customer’s instructions, even if they are cumbersome or payment might be significantly delayed.

Typically, you will need to cite their purchase order number and mail the invoice separately from the shipment. Often the purchase order number will need to be included on the shipping label or in documentation accompanying the order. If the purchase order is missing, some firms may refuse to accept delivery of the order. Many large firms have instituted draconian penalties for not following shipping instructions precisely.

Statements

In addition to sending an invoice at the time of the order, you should send each customer a statement each month that summarizes account activity. Statements should include outstanding invoices, payments received during the month, and any other credits or charges. If you are a very small firm dealing with other relatively small businesses, an alternative to mailing statements may be to send copies of any outstanding invoices marked “reminder” or “second notice.”


About Bob Adams

Bob Adams is a Harvard MBA serial entrepreneur. He has started over a dozen businesses including one that he launched with $1500 and sold for $40 million. He has written 17 books and created 52 online courses for entrepreneurs. Bob also founded BusinessTown, the go-to learning platform for starting and running a business.

QUIZ: WHAT BUSINESS IS BEST FOR YOU?

QUIZ: WHAT BUSINESS IS BEST FOR YOU?