All business owners have one common goal: world domination. Jk, jk—maybe not all of them.
Okay, but for real—a common goal all biz owners have is finding ways to make their lives easier and get paid faster (which can be equally ambitious!). Whether this means becoming more cost-effective, more efficient, or more profitable, there’s also one common solution… Drum roll, please.
While automation can apply to many processes, we’ll specifically be focusing on invoice automation in this article.
Automated invoicing gives busy small business owners the chance to focus more on growing their businesses and less on the pesky administrative activities associated with it, like sending an invoice or following up on an overdue payment. Plus, there are clear advantages to using invoicing software versus creating and sending invoices manually.
Let’s take a look at why you should hop on the automated invoicing bandwagon, and five ways you can automate your invoices to get paid faster.
What is automated invoicing?
Automated invoicing is the process of setting up your invoicing process to function automatically, which includes creating and scheduling invoices in advance to get sent out to customers at a certain time. This usually means your invoices are sent digitally, and stored in a server, using invoicing software.
Automated invoicing vs. manual invoicing
Now that we’re all on the same page about what automated invoicing is, let’s compare automated invoicing with manual invoicing.
Manual invoicing refers to the process of using a word processor or spreadsheet to create invoices yourself, and then manually sending the invoice to each customer either by mail or email.
Here are some more key differences:
- Customization: If you manually create an invoice, you’ll need to customize the information on each invoice every single time. With invoicing software, plugging in information—like invoice numbers—is done automatically
- Processing time: It takes longer to process an invoice manually compared to an automated invoice
- Cost: Manual invoicing is more expensive than automated invoicing (costing around $16 - $22 on average)—plus, there’s the cost of the time it takes the manually manage invoices
- Reminders: With manual invoicing, you’re responsible for sending invoices and payment reminders, which automated invoicing can take care of for you
- Reporting: When you automate invoices, you’ll also usually have access to reporting on key data that will help you make smart money decisions. With manual invoicing, you’ll have to gather data and keep track of everything by yourself
- Payments: Similarly, you can usually directly integrate with an online payments software on automated invoices so you can collect payments directly from an invoice, which isn’t possible for manual invoices
The benefits of automated invoicing
Automations in general save you time and money. And time is money for a busy small business owner (afterall, you need plenty of time to plan your world domination)! Automating your processes—including invoicing—can help you get paid by your clients faster, which is crucial for speeding up your cash flow.
Here are some of the other benefits of automated invoicing:
- Save time: By letting your invoicing software take care of the manual work for you—like data entry, proofreading, and processing—you can get as many as 10 or 20 hours back to put into your business.
- Reduce errors: There’s less room for human error when you automate invoices. Even a small error on an invoice can be a huge headache to correct, which automated invoicing can help prevent.
- Get paid faster: Letting your customers make online payments directly through a digital invoice increases your chances of getting paid on time, which speeds up your cash flow.
- Look and feel like a pro: Automating your invoices also gives your customers a better and easier experience, so you’ll look and feel buttoned-up.
- Your books are always up-to-date: Access to real-time financial records and reporting is crucial for keeping track of how your business is performing, which automated invoicing takes care of for you. (You’ll really appreciate this during tax time too.)
- Reduce your carbon footprint: If you’re sending digital invoices—rather than using paper invoices, and mailing those out—you’re saving a whole lot of trees.
5 ways to automate invoicing
Now that you know what automated invoicing is and why it’s so important for streamlining how you run your business, let’s get into our roundup of the best ways to automate your invoices, which includes:
- Automating email reminders
- Setting up recurring invoices
- Setting up automatic payments
- Scheduling invoices
- Using invoicing software
1) Email reminders
Email reminders, our first method of invoice automation, are a key way to keep your clients up-to-speed on when invoices are due. You can set up email reminders using invoicing software (more on this later!) to automatically send when invoices are upcoming, are due, and are overdue.
Upcoming invoice reminders
Why wait until when a payment is due to send a reminder? Sometimes, a client might receive an invoice, set it aside to make a payment later, and forget about it. Sending email reminders of upcoming invoices are a great way to ensure you get paid on time and protect yourself from late payments.
Invoice due reminders
When the invoice due date arrives, you can also set your invoicing software to remind your clients on the day of. These automated emails let the client know that payment is due today, so they can easily click through and make the payment on time.
Invoice overdue reminders
Chasing an overdue payment is no fun for anyone. Late payments are sometimes inevitable, even if you’ve taken the above steps. Following up on late payments isn’t the best use of your time, so an automated email notification of overdue invoices is a great way to stay on top of unpaid invoices without investing your time in it.
Did you know?
Hi, shameless plug time! Did you know that with Wave’s invoicing software, you can set up automatic email alerts to send to your customers? You can remind them of upcoming invoices, notify them on the day an invoice is due, and alert them that an invoice is overdue at various chosen periods. This way, you'll never chase late payments again—we’ll be the bad guy for you. 😉
2) Set up recurring invoices
If you have clients on retainer or customers signed up for your subscription services, manually creating the same invoice each period is tedious, time-consuming, repetitive, and just plain [insert other synonym for superrr boring here].
For ongoing projects with the same invoice each period, you can create the invoice once and schedule it to send each period, which will save you major time and brain power.
Did you know?
You probably know what we’re about to say here. Yup, Wave’s invoicing software lets you set up recurring invoices! You can customize invoices for any day of the week, month, or time zone—and in any frequency—with total flexibility, so you can save time and sanity.
3) Setup automatic payments for your recurring invoices
You can also take the automation a step further and automate the actual payments of recurring invoices. In other words, your invoice would automatically be created and sent, and then your customer would automatically be charged. Phew, that’s a lot of automation.
This requires an extra level of trust with your customer, as they’ll be allowing you to automatically charge their credit card or bank account on an ongoing basis. But it also saves them time, so this could be a snazzy option not only to you, but also to your client making the payment.
Did you know?
If you do this with Wave’s invoicing feature, you can either prompt an email to send to your customer, requesting they enter their payment information for auto-pay, OR they can provide you with their payment info directly, such as over the phone, so you can manually enter it.
Then you can set up recurring billing with automatic payments for your repeat customers, so you can feel confident knowing you’ll get paid on time, every time! You’re in full control, and can switch between automatic and manual billing whenever you want.
4) Schedule invoices for future payments
If you’ve closed a sale but aren’t ready to send the invoice yet, you can also schedule the invoice itself to go to the customer at a later date using invoicing software.
Let’s say you’ve booked a major project slated to start in two months. You might want to create the invoice now and schedule it to go two months later—one less check box you’ll have to tick when kicking off the project. This can help you focus on the work rather than the pesky admin associated with it.
5) Create invoices with invoicing software
We’ve been talking a lot about automating the sending of invoices, but haven’t really touched on automating the invoice creation process. Digital invoices are created with invoicing software, which makes it easy to create invoices that help you look and feel like the pro you are.
One wonderful option is one you’re probably very familiar with by now—Wave’s invoicing software, which lets you create customizable, professional-looking digital invoices in seconds and includes all the features we mentioned—like automatic billing and reminders—along with the ability to enable online payments directly on an invoice to give your clients easy options to make a payment. Our invoicing feature will help you get paid faster, save time and money, and stay on top of your invoices.
Using an integration app like Zapier can also help automate invoicing with both Google Forms and Google Sheets, too.
If you use Zapier, you can do automated invoice generation with Google Drive:
- Google Forms: If a user submits or edits a response, you can tell Zapier to signal to Wave it’s time to create an invoice.
- Google Sheets: You can also use Google Sheets to automatically generate invoices when you’ve added or updated a worksheet, spreadsheet, or row in the associated document.
Get started with automated invoicing today!
Invoice automation is a great way to make running your business easier and help you get paid faster. The best part about reducing the time you spend on the administrative side of your business is that you get to spend more time doing what you’re good at—which we’re sure your customers will really appreciate, too. We love a win-win situation.
One final “Did you know?” before we part ways: Did you know Wave’s invoicing feature (which is free, BTW) is part of a suite of money management tools, which includes our accounting feature and our online payments feature, giving you total control of your money in one place? Your invoice and payment details will automatically sync with our accounting feature, ensuring your records are always accurate, so you’re always ready for tax time.
For even more tips and tricks on how to get paid faster, you can also check out Wave’s guide on how to get paid faster. Now get out there, automate your invoices, and get paid faster!
The information and tips shared on this blog are meant to be used as learning and personal development tools as you launch, run and grow your business. While a good place to start, these articles should not take the place of personalized advice from professionals. As our lawyers would say: “All content on Wave’s blog is intended for informational purposes only. It should not be considered legal or financial advice.” Additionally, Wave is the legal copyright holder of all materials on the blog, and others cannot re-use or publish it without our written consent.