One of the most exciting parts of business ownership is making money, so you need to develop your billing policies well before getting your first client. There's nothing worse than speaking with a prospective client and being tongue-tied when she asks you how you invoice. Here are some tips for making sure you have your bases covered:
- Decide on Payment Methods -- Do you plan to accept payment by check or do you want to take credit card as well? Are you going to use a service like PayPal?
- Create a Monthly Schedule -- Pick one day a month to do invoicing. It’s also great if you can coordinate your monthly bill payments on the same day.
- Bill in Increments -- Decide how you want to bill for your time, i.e., actual time spent, in 6-minute increments, 15-minute increments, etc.
- Track Your Time -- You will definitely want to use a time tracking application to keep tabs on your work for clients. Most have a "punch-in/out" function so you can accurately account for your time, even if you quickly switch from one task to another.
- Keep Clients Informed -- There can be nothing more shocking for a client who gets a humongous invoice at the end of the month that they weren't expecting. Keep them updated on how much time you have put in. I do this by sending my retainer clients a weekly time report at the end of each week, showing them what tasks I spent time on each day. It carries a running total for each week and month. This also comes in very handy at month’s end when I do my invoicing. The VA Resource Toolkit Online Edition includes a sample time report you can use in your business.
- Follow Up When Overdue -- You should create a plan for following up with clients who are late in paying. How long are you giving your clients to pay your invoices? What type of reminder will you send them? Will you cease all work until you are paid?
You may also want to consider hiring a bookkeeper. A professional can do a thorough job managing your monthly books, submit any required forms and prepare your files at year-end for your accountant. Not to mention this will free up your time to focus on what you do best!
This post is expanded from Chapter 6: My Top 20 Secrets to Success in the book, VA Secrets Revealed! An Insider's Guide to Being a Successful Virtual Assistant. Grab a copy and follow along as I blog!
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