Invoices, the cornerstones of an effective billing process, are more than just collection vehicles. They also form important connections with customers that provide strategic opportunities for companies to build relationships, increase satisfaction, and cross-sell. By taking full advantage of the opportunities each invoice provides to communicate with customers, companies gain strategic business advantage in the ongoing struggle to hold on to customers.
But effective billing requires more than effective invoices. It also requires communication and input from related departments involved in the customer order cycle -- from order entry to collections. All these functions need to work together efficiently to prevent errors, speed payments, and most important, cement lasting customer relationships.
Best Practices Leading companies can provide insights on optimum ways to perform the billing process. The best practices they have applied are discussed here.
Generate clear, concise customer invoices that are easy to read and calculate. Invoices that allow customers to quickly recalculate and confirm purchases help expedite collections by removing obstacles to payment. But providing clear, concise invoices that are easy to read and calculate requires careful evaluation. This means identifying which features add value for the customer and which ones waste space.
Obtaining customer and employee input on invoice content and design provides insight into what information they need and how to effectively display it on the invoice. Some common methods for uncovering this information include conducting focus groups, surveying slow-paying and key customers, and interviewing employees.
Price structures that are easy to calculate and display reduce the time it takes to generate invoices, to manage the process, and to settle disputes. Building discounts and incentives into the standard price structure rather than using special deals or promotions minimizes pricing complexity and allows both customers and billing employees to calculate charges easily.