invoicing can feel like an incredibly simple part of your business operations. You certainly won’t expect to require training, practice, and ongoing improvement here. Yet, the fact that an average of 93% of companies experience late invoice payments at some stage highlights that this corner of operations might not be quite the walk in the park you’re expecting.
These issues can come from the customer-facing end, and having a clear recuperation process in place for this eventuality is essential. Sometimes, though, invoices get caught up in a backlog of your own making. And that’s an issue only you can solve.
Common bottlenecks in invoice management are especially deserving of your attention, but what are they, and what can you do to overcome them? Keep on reading to find out.
# 1 – Data Entry Errors
Manual invoicing processes tend to be rife with data entry errors, and it’s shocking how much they can delay your payments. A typo, such as an error with a client’s address or invoicing number, can see you waiting on a payment, or losing future custom by chasing up a late payment that you’ve simply missed in your accounts. More seriously, invoice amount errors can leave you out of pocket with few recourse options.
That’s why our first big tip is to simply invest in automated invoicing software that puts an end to manual data entry altogether. Your processes will generally be faster this way, while the automatic creation of accurate invoices makes it far more likely that payments will land in your bank how and when they should.
# 2 – Missing Invoice Approval
Missing invoice approvals can lead to payment delays that are weeks or months in the making, and they’re surprisingly common despite the fact that approval seems like such a simple step. This is because issues with everything from invoice routing to oversight can quickly result in invoices that are lost or otherwise overlooked.
Again, automation can help with this by ensuring invoices are always routed to the right departments and individuals. Certain systems can even automatically approve invoices on your team’s behalf. Even if you’re keen to retain manual approvals, it’s vital to set clear approval hierarchies, standardize your approval processes, and continually monitor this key area of invoicing operations.
# 3 – Inconsistent Data Formats
Inconsistent data formats are a more technical but equally vital consideration within invoice management. If some clients want their invoices as PDFs, while suppliers on your books require structured EDI, you’ll waste a lot of time going back and forth. You also risk sending an invoice in the wrong format and delaying payments even more.
Automated systems are once again beneficial in this sense, as they can revolutionize data management that automatically switches file types depending on customer requirements. Equally, simple steps like ensuring invoicing compatibility with suppliers can help you send and receive invoices far more easily.
Invoicing bottlenecks are bad for business, so it’s past time you prepared for battle with these common problems!
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