While invoicing may seem tedious and time-consuming when you’ve got so much else to do as an entrepreneur, cash flow is absolutely critical to keeping the lights on. Invoicing software can take a lot of the stress out of this laborious task.
At Remitly, we’re committed to supporting immigrants and business owners to get on their feet and manage their finances in the USA. In this guide, we’ll take a look at everything you need to know about invoicing, highlighting some of the different software options out there which will make the task more efficient and allow you to spend more time on running your business.
Best invoicing software for small businesses
Invoicing software, also known as billing software, is a tool that any freelancer or small business owner should have in their arsenal–among many others. Rather than calculating payments and writing up each invoice by hand, let invoicing software handle the leg work and free up more of your own time and energy.
Aside from the convenience they offer, there are plenty of reasons why invoicing software could be highly valuable to you.
Why software for invoicing is essential for small businesses
With invoicing being such an important task in any business, anything you can do to make this process more accurate, more reliable, and more efficient is a step in the right direction. That’s where invoicing software comes in.
It can help in a few key ways. With the right software, you can store and quickly access your customers’ history and data. Your sales data can also be stored to make recording income easier come tax season. As invoice software helps you keep track of everything, you’re also less liable to make errors like losing track of overdue incoming or outgoing payments. All this means your business will run more efficiently and you can more reliably keep on top of that cash flow.
Overview of top invoicing software features to consider
When choosing invoicing software, its features will be the most important aspect in deciding which one to use. The best invoicing software for small businesses should be able to:
- Create customized invoices,
- Accept online payments and send automatic payment reminders,
- Track the status of all your invoices on an easy-to-read dashboard,
- Create estimates or quotations and then convert them to invoices.
Your invoicing software of choice should also offer integration with your chosen accounting software as well as interface with e-commerce sites, your Customer Relationship Management (CRM) software, and your inventory applications.
Top five options for invoicing programs for small businesses
Keeping these features in mind, let’s check out five different invoicing software options. These popular solutions already serve many small business owners and freelancers well, so one of them will likely be a good fit for your business.
Zoho Invoice: small cost, big features
Zoho Invoice is a free software with plenty of features. Though it’s limited to only 500 invoices sent per year, freelancers and other very small businesses should find this to be enough for their needs. You can create templates, send invoices through multiple contact methods and receive payment for them through just as many payment options.
It also offers apps on both iOS and Android devices and integrates with QuickBooks accounting software to track not just income but also business expenses. So for a free option, it’s pretty good.
QuickBooks: suitable for very small businesses?
Quickbooks is a tried and tested option that, while packed with features like inventory management, in-person payment processing, time tracking, and tax preparation, does come at a bit of a cost. Depending on the features you need, the price can range from $35 to $235 per month.
For a small business in a brick-and-mortar location with employees and inventory to track, Quickbooks can be a great solution. But if your business is smaller, this may be more than you need.
FreshBooks: how does it compare to QuickBooks?
FreshBooks is a strong choice for businesses and freelancers who are just getting started and don’t have the accounting expertise to understand the jargon that an option like QuickBooks might throw at them.
FreshBooks allows for payment processing and invoice creation with very accessible pricing—starting as low as $21 per month—but it can quickly add up, depending on how many clients you’ll be billing and whether you’ll need advanced payment options. Still, it can be a very good option for business owners and freelancers who are just starting out and feel a bit daunted by QuickBooks.
Invoice Ninja: does it make the cut?
Invoice Ninja is another software which offers free plans. What this excels at is its ability to customize payments and even accept deposits and tips. Invoice Ninja also works with over a dozen different payment gateways to help you reach more customers.
It includes inventory tracking and a client portal, but a downside is that it doesn’t integrate with any bookkeeping or accounting software, so you’ll need to find a way around that. That said, for people just getting started, Invoice Ninja’s free plan will be plenty to help you get your business off the ground.
Invoicely: it’s all about growth.
Invoicely is another one that’s been around as a free option for some time. It has a strong set of payment gateways, but the free version only allows for PayPal integrations and lacks customization options and space for saving customer profile information.
However, the Basic plan can be a good deal at $9.99 per month and this offers plenty of room for scaling your business up before you need to move to a more upscale solution.
Simplify business invoicing with customizable templates
Having looked at a few of the popular options, one feature that comes up a lot is customizable templates. Customizable templates are tools which allow you to save and come back to certain invoices which can also be updated to fit your current need. This can be really helpful and incredibly efficient in running your small business.
The role of invoice templates in streamlining business operations
The benefits of using invoice templates might seem simple, but they go a long way towards making your business run smoother.
- Save time
You won’t need to go in and design your invoice from scratch each time. - Build your brand
The professional appearance of a consistent design for your invoice can make a marked difference in the eyes of your customers. - Fewer errors
Put in your data once and it’ll always be at your fingertips. This means less need to double-check customer or product information and less likelihood of making a careless error. - Faster payments
Invoices that are clear and well-designed give no excuse for late payment. - Room to grow
As you add more clients and more products, the information is saved efficiently and sending more invoices based on a template is much faster than making each one individually.
How to create, customize and use invoice templates
Each invoicing software will be slightly different, but they’ll all offer similar features when it comes to customizing and using your invoice templates.
Start by choosing your design elements. This will include your business logo, matching the color scheme to your brand, and picking typefaces that align with your identity. Your invoice should be a clean and professional document, so less is more on these templates—don’t make them too cluttered.
When it comes to actually using your templates, take advantage of them by following a consistent invoicing schedule and automating any recurring ones where you can. With your template, sitting down to create the invoices means you can get many more made at once and make less demands on your precious time and energy.
Using invoicing software to make billing more efficient
In many cases, “invoicing software” and “billing software” are one and the same. This means that the software you use to create your invoice will also be the one that you use to collect payment. This is one of the things that make invoicing software so efficient. But there are a few ways that this can be taken even further.
Automate your billing process
Automating billing frees up time you can spend working on growing your business. As you’ll know, writing up the invoice is only the first step in the process—you have to send it out, and you need to make sure you’re paid in time and chase it down if it’s late.
With automated billing, all of this can be handled in the background while you deal with more pressing tasks. Many invoicing software options will not just send invoices, but also track their payment status and send customizable, automated reminders in case of non-payment. They’ll often include at least one payment option as well.
Benefits of using payment reminders and online payments
Automated payment reminders and online payment options are two of the main draws of the best invoicing software solutions—aside from the efficiency gains, they often include multiple customizable options for contacting different client groups.
These options will eventually help you better understand the best ways to reach your clients by analyzing the contact method that gets the best response. This leads to faster payment recovery for you and clients who are satisfied by you meeting them where they are.
Having at least one online payment option or “payment gateway” is another sign of efficient invoicing software. Integrating this into the invoice means that your preferred payment methods are readily accessible to your clients, no matter where they are. They’ll also be reassured by the more robust security and, in turn, more likely to pay you quickly.
Maximize the use of invoicing software for your small business
So, invoicing software can be a game changer for small businesses that are still sending out invoices manually. The time and energy saved by storing invoice templates alongside customer and product data can be massive, even before accounting for features like billing management and online payment processing.
Many of the options that we’ve talked about here are quite affordable, but there are options that are totally free. These are typically more than good enough for very small businesses or solo freelancers who are just starting out. Find the right one for you and you’ll have taken another positive step in ensuring your small business is a success.
FAQs
Is Excel good for invoicing?
While it can work for very small businesses, Excel isn’t the best solution in most cases because it lacks invoice-specific automation. That makes it more prone to human error and less than ideal as your business grows.
Is Zoho invoicing really free, and how much does it cost?
Yep, Zoho really is free. However, you can only send 500 invoices per year and only two user profiles can be added.
What’s the best software to create invoices?
The best invoice and billing software for a small business is the one that most closely aligns with your business’s needs. Some commonly recommended solutions are Zoho Invoice, Invoice Ninja and FreshBooks, but there are many others.
What are the most important tips for using billing software effectively?
Some of the best tips for using billing software include:
- Automate your invoicing systems,
- Standardize your billing information and invoice format,
- Offer multiple payment options.