Why accountants should tell their clients to stop manual invoicing
September 14 2022
In December 2021, PWC’s study showed that over 90% of invoice processes in Australia were either part or fully manual. So why is this such a bad thing and how can an invoicing solution help...?
Clients may not necessarily be making mistakes with figures, but what if the payee’s name doesn’t quite match the name on the bank account? If they send everything manually, they won’t receive notifications about any errors that have been made and will find it hard to keep cross-referencing all the information.
Typing out a Word document that’s not backed up automatically- what happens if a computer crashes? When they have received the money, do they go back to the Word document and update it, or set up a new folder with ‘Paid’ invoices in? Either way is time consuming and subject to human error.
With an online system, all the customer’s details are already stored so all your client must do is just click on a name to send them an invoice – then the bank account has already been verified by the customer - meaning no mistakes when it comes to sending money, plus once the invoice has been paid, it shows up on the invoicing system as having been paid.
There's a high chance that as an accountancy firm you’ll be using Xero or a similar package to manage your clients’ accounts. However, some businesses, especially sole traders – might not have the time or expertise to use Xero. By using bzTrack, they can quickly log in, synchronise all their invoices from Xero and see how their cashflow looks from their easy-to-view bzTrack Dashboard.
How bzTrack works alongside Xero
Once connected, bills and invoices that are created on either platform show up in the other within a few seconds. This gives you access to the best each platform has to offer without any double entry.
For example, your client can create and send an invoice in bzTrack and it will be sitting in Xero waiting for you to reconcile when it gets paid.
Similarly, those who like bzTrack's speedy bill paying workflow, can enter and pay bills in bzTrack and they will immediately show up in Xero as paid.
When sending invoices manually, people tend to include the bare minimum such as the item or services being sold, and quantity or time involved. If a business wants to include other additional fees or payment terms, these will have to be itemised in a time-consuming way and then related back to the customer. With an invoicing solution, it’s simple to set up specific terms for every customer.
Paying invoices easily
No one likes having to deal with invoices, but if they’re tricky to pay, it’s an even more tedious task. By using invoicing software like bzTrack, customers can pay by card- encouraging quick payment. Having to copy and paste BSB and Account Numbers needs to be a thing of the past and with invoicing software this can be.
We recently surveyed 300 small businesses and found that on average each business was spending between 8-10 hours every month processing invoices. That’s an entire day each month that could be spent on marketing, HR, generating sales and more. Recording every invoice manually and then chasing each one by email, phone or in person - plus sending out receipts for when payment has been received takes a lot of patience and hard work. Switching to an online system removes a lot of unnecessary work and gives business owners time back to focus on more important things.
A recent survey by Xero (Crunch: Cash flow challenges facing small businesses Part 11) released at this year’s recent XeroCon Sydney, revealed that overdue invoices are costing small businesses $1.1 billion a year, and waiting times for payment have reached an average of 6.4 days. Using an online invoice system allows businesses to save time chasing late payments by using automated reminders rather than relying on someone having to call or email customers who’ve missed a deadline.How bzTrack can help…
bzTrack is a ‘smart invoice processing solution’ – in effect a form of e-invoicing. E-invoicing isn’t the same as sending an invoice (either on a PDF or another document) via e-mail. It’s a way of safely sending and storing invoicing in an online system.
By using a platform like bzTrack, you can login to one system and see all your business finances from one place. From your dashboard you – or your client, can see when money is due in, what invoices you need to pay (and schedule payments accordingly).
Rewards for early payment
Your clients might have some customers who are habitual late payers and some who always pay well before the invoice’s due date. With bzTrack’s invoice discounting, business owners can set up discounts for invoices that are paid within x number of days – ensuring that they receive payment on time and their customer has an incentive not just to pay early but to work with them again knowing they’ll get a discounted rate when they pay before the due date.
Knowing your customer
bzTrack's platform allows businesses to perform a quick credit check or a more detailed credit report on businesses they’re trading with. Understanding the credit rating of a business ensures you’re aware of any risks they have and allows you to set payment and trading terms accordingly. Businesses can also run a quick credit check on their own company to see how it appears to others who might be checking out their financials. From the credit report, you can see the business’ credit history and know if their rating is improving or deteriorating.
With more features to come over the next few months, bzTrack can help businesses – even those with an accountant, get paid on time and perhaps most importantly, keep a watchful eye on their finances easily from a quick glance at an easy-to-use dashboard.
Learn more and create a free account at www.bztrack.com