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On November 18th, 2016 by Alexander Hubenthal

How and When to Bill (Invoice) Your Customers

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You want to be paid for the work you did right? Well of course you do but did you know that you could be doing things that might be delaying you being paid?

Here’s the bad news: In most cases, it’s really easy to mess up invoicing.

Here’s the good news: It’s really easy to prevent mistakes

When 2 or more parties agree to an exchange of goods and or services they usually will enter into some form of an agreement or contract. When this agreement is established and signed by all parties, they are agreeing to a lot of things that will affect the invoice process.


The 7 Must Haves for Every Invoice

  1. Your Business Name and Address. This is established when you file papers to be an official business in your state or providence.
  2. The Address and Name of the business you are invoicing. It is also important to add a contact name to your invoice here.
  3. A unique invoice or reference number for this invoice and this invoice only. PLEASE NEVER EVER USE AN INVOICE NUMBER MORE THAN ONCE. It makes us Accountants and Bookkeepers die a little on the inside every time we see this 😱.
  4. A date on the invoice. Usually the date the invoice is generated.
  5. A list of all the goods and or services you provided. These MUST be broken out on separate line items on the invoice with their individual cost.
  6. A Total amount for the invoice
  7. The agreed upon payment terms. This is how long the customer has to pay from the date of your invoice. Generally, the standard is 30 days. Some companies might go with shorter payment terms and others might go with longer payment terms.

I know Fortune 100 companies that are currently paying 120 day payment terms. Yes. You read that right. 4 whole months.

3 Things to Also Consider when Invoicing

  1. When working with bigger clients, they might provide you a Purchase Order or other reference number. This number should also be included on the invoice so your customer can quickly identify the charges and who requested the goods or services.
  2. It is beneficial if you include the ways you accept payment for the invoice (i.e. PayPal, Bank, Credit Card, etc.) and the associated links or bank account details on the invoice.
  3. If you charge sales tax or VAT tax on your invoice, it is important to either include or provide your EIN (in the USA) to your customer so they can cut down on time when it comes time to file taxes.

When should you invoice your customer?

As mentioned previously, when 2 or more parties enter into an agreement either formally (with a contract) or informally (by mouth), the timing of which that you can bill your customer will be established.

Billing for Services

When Rendering Services, you can bill one of two ways; before services are rendered or after.

When you bill your customer before you render services, you the service provider bear no risk. Meaning you won’t have to worry about going after the customer for payment after the service is provided. If you are just starting out, you might have a hard time convincing your customer to pay up front because they might not trust you and your business, yet.

If you decide to bill your customer after services are rendered, be sure that payment terms are agreed upon prior to services being rendered. Unfortunately, a lot of Businesses and People don’t like paying on time. This can lead to having cash shortage problems in your business and in some extreme cases it can lead to expensive legal costs.

Billing for Products

The majority of billing for products occurs at the time the order is placed. In Business to Consumer (B2C) transactions, billing and payment occur simultaneously. For Business to Business (B2B) transactions, billing occurs at the time of the transaction but payment is done in line with the agreed upon payment terms.

Billing for Construction

In the event that you work or know someone who works in construction or other blue-collar trade (HVAC, Plumbing, General Contractor, etc.) billing can reflect the service model or a payment plan system.

The payment plan system usually follows something like the following: At the beginning of the project (usually when the agreement is signed) a down payment of roughly 20% is required for work to begin. This 20% allows the business to put funds where they are needed (labor, materials, etc.) and then payments of 20% will continue when the company reaches milestones. Think of putting a roof on a new building as an example for a milestone.

On November 11th, 2016 by Alexander Hubenthal

Preparing Your Business for 2017

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What do you want your business to achieve for next year? If you haven’t started planning yet, you are behind.

It has been an exciting week. Regardless of where you stand politically, we will have a new president in the USA come January. While we are on the topic, no one in the political arena will affect your abilities or capabilities as a business owner. You alone have the ability and responsibility to grow your business. The more time you spend being distracted by these current events and others that do not directly affect you as a business owner, the more you and your business’s performance will suffer. Why? Because it is taking time away from your productivity. Please don’t let some current event or individual be the cause for you to miss out on sales, blog post(s), etc. that you could have generated otherwise.


Most business owners I meet begin planning out the following year around early to mid October and will wrap up their planning by early to mid November. This planning can include everything from forecasting Labor Had Counts, developing a budget for the year, etc.

By not setting goals, you will go nowhere. If you have been in business for at least a couple of years, you will be able to pull on historical financial data to develop accurate forecasts to help propel your business foreward. A great tool that I reccommend for established businesses is Fathom. This platform integrates directly with both Quick Books Online and Xero and provides a treasure trove of information. A favorite feature of mine on here allows you to benchmark against other companies in the industry that you operate in. By using this information you can see where you are underperforming and outperforming your competition. Using this information, you can make more informed business decisions next year as well as make a more informed budget.

If you are starting out, the first 18–24 months in your business will be a little unpredictable in terms of financial performance and there will be little to no financial data to provide information. Your main goal should be to establish a sales base, one preferably with a recurring revenue model to guarantee revenue for your products and/or services. One issue that you will have to look out for with a recurring revenue model is creep. If you don’t watch this closely and consistently, you could have a big problem on your hands.

After you establish a baseline revenue model, it would be a good idea to write down exaclty how many customers you need to achieve “X” goal in 2017. For most of us, that goal will be some monetaty figure. For example, if you currently have no customers and your primary goal is to be generating $10,000 a month by December 31, 2017; you will need to work backwards to determine how much work you will need to do to reach that goal. Assuming you use a recurring revenue model, and each customer pays you $400 per month, you will need to acquire a little more than 2 clients per month to reach that goal. After you are established, the tool mentioned earlier will continue to help you grow and help point out any areas that your business can improve upon.


What is a specific goal that you want to accomplish in your business or career for 2017? Let us know in the comments.

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