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This scenario is repeated millions of times every day, without fail. A business sells services/products to a customer and both are thrilled with the exchange: the business with the sale, the customer with the quality of what they received.

The next step is a critical one and this is where thousands of small businesses fall down: they make the sale, then sit on the invoice for one, two or three weeks, in some instances, months, before posting the invoice to the customer. They fail to recognise the importance of invoicing on time. It’s like giving away money for free.

This time lag can have a negative impact on your cash flow. The ideal situation is where you have a surplus of income over expenditure – your profit. But if you delay issuing your invoices then you may well have more expenditure than income leading to issues meeting day-to-day expenses. This problem will be more acute in some industries over others, particularly those that have to buy raw materials on a daily/weekly basis.

What many business owners don’t realise is that the late issuing of invoices often causes havoc on the customer side. A timely invoice is a reminder to the customer that money is due and payment must be scheduled. A late invoice on the other hand may be queried or even worse, rejected and returned with request for proof of delivery, etc. This causes headaches for everyone concerned with the result that late invoices can give rise to poor customer relations. Mad really when we work so hard to win a customer, that we can then let them slip away for want of clicking a button.

There is no reason to be late with issuing invoices. Issuing invoices as soon as the work is completed/delivered must be a number one priority. Online accounts software such as Big Red Cloud’s is a great help here – record the sale, raise the invoice and click to send via email and/or print a copy to send via snail mail. Simple, easy and very effective.

Did you know that as of 1st January 2013, the Second Directive on VAT invoicing, brought into EU-wide law a directive that treats paper and electronic invoices equally. There is no longer any legal obstacle to any customer in the EU refusing to accept or recognise invoices via email.

So, ‘the importance of invoicing on time,’ make it a mantra for your accounts department. It’s good for your cash flow and as we’ve seen above, it’s also good for customer relations.

Marc O'Dwyer

After completing a Graduate program in Marketing, Marc’s impressive sales career began at Allied Irish Banks, Pitney Bowes and Panasonic where he received numerous Irish and European sales performance awards and consistently exceeded targets and expectations. In 1992, Marc’s entrepreneurial spirit led him to set up his own business, Irish International Sales (IIS). Initially, this company was a reseller for Take 5 Accounts and Payroll software. Within four years, IIS became the largest reseller of Take 5 in Ireland, acquiring four other Take 5 resellers. He also found time to set up two mobile phone shops under the Cellular World brand and a web design company offering website design services for small businesses. In 2001, he bought the majority share in a small Irish software business, Big Red Book. At that time, the company was losing money. The company became profitable within two months, and Marc then acquired a payroll company to compliment Big Red Books Accounting products. In 2003, IIS were appointed as Channel Partners with SAP for their new SME product, SAP Business One. Marc sold his Take 5 business and concentrated on developing this new market for SAP As a result, by 2007, IIS was recognised as the largest Channel Partner for SAP in EMEA (Europe Middle East and Africa). In 2008, the IIS Sales Manager bought the Company from Marc in an MBO. He launched Big red cloud in June 2012, the online version of big red book, to date the company successfully converts 59% of trials into sales and the number of customers is growing rapidly. Marc continues to run both Big Red Book and Big Red Cloud which now support 75,000 businesses. He is a very keen sportsman, having played rugby for 20 years, represented Leinster at under 16 and under 20 levels, and league squash with Fitzwilliam Lawn Tennis Club for 10 years. Marc has competed in 11 Marathons, including the London and Boston Marathons, and has completed several Triathlons and Half Ironman races. He has also completed six Ironman Races in Austria(x2), Frankfurt (Germany), Nice (France) , Mallorca (Spain) and Copenhagen (Denmark)

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