Whether you’re an entrepreneur just starting out or a growing SME, invoices play an integral role in your business. However, they often become a source of confusion, a major challenge, and an administrative nightmare. The solution? Invoice templates.
Utilizing invoice templates helps you to create a streamlined invoicing process that ensures your business financials are always under control. Templates can also make your business look more professional, serve as marketing tools, and encourage your clients to settle amounts owed on time.
Invoice templates are digital documents that make it easy to customize, edit, and create invoices that meet the needs of your business exactly. They’re also readily available for free online, or you can opt to purchase templates if you prefer.
Without an invoice template, you’re tasked with creating a new document each time, adding unnecessary labor and time consumption to the process. But when you have one of these pre-designed templates on hand, you can create, send off, and reuse invoices with ease. Some other advantages are:
These advantages can make a significant impact on the experience of the employees who draw up invoices and the clients who receive them.
Another big perk of using invoice templates is that it makes processing recurring invoices much easier. Instead of compiling an invoice from scratch, you have the luxury of reusing existing editable copies for new or regular clients. It’s low-effort, high-reward business management gold.
When it comes to running a business, your billing system may require you to use a wide variety of different invoice templates. Depending on who the client is and what your professional relationship with them looks like, the format, structure, and content of an invoice template can change.
However, once you’ve got a few basic templates, managing your business’s financial affairs will become far easier and more efficient.
Here are 5 important yet easy-to-use invoice templates:
Pro Forma Invoice
A pro forma invoice is one of the most widely used invoice templates. Essentially, an official estimation invoice, a pro forma template features projected dates, costs, and deliverables that may be subject to change at a later stage. You can view a proforma invoice as a type of quote or preliminary invoice as it will include the payable amount and details about the transaction.
After a pro forma invoice gets sent to the client, they will review it and decide if they wish to proceed.
Standard Invoice
This is the kind of invoice that almost every business should have in its arsenal. Perfect for basic sales and service compensation, the standard invoice template is a classic.
A standard invoice gets sent to the respective client with a request for payment for goods or services. It contains typical information such as the date, buyer’s details (name, email address, phone number or and business address), list of relevant goods or services, the total amount owed including taxes, and a payment deadline.
Another feature of the standard invoice is the addition of payment method options. You can include banking details, a PayPal email address, a QR code, or any other banking method that your business accepts.
Timesheet Invoice
Timesheet invoices are for businesses that get paid based on how many hours they’ve worked on a particular project. Instead of facilitating a lump sum payment for the entire project, timesheet invoices measure how many hours have been accumulated and what the client owes as a result.
This kind of invoice is ideal for creative businesses that work on projects where it’s difficult to estimate a time frame. Graphic design agencies, for example, often prefer this kind of invoice template.
A timesheet invoice should always feature the hourly rate of the business. Some of the other elements included in a typical timesheet invoice are a list of the tasks worked on, the start and end dates of the project, the total hours worked, and any other relevant administrative fees. Although this sounds like a lot of information, if you use a free invoice template PDF you can easily create a document that simply requires populating predetermined fields for every project.
Interim Invoice
If your business works with larger scale, long-term, or very expensive projects, you may have heard of an interim invoice. An interim invoice serves as a temporary report that tackles a portion of the operational and administrative costs.
As the name suggests, this type of invoice is used in the interim of a project until a final invoice is issued. When it comes to long-term projects subject to regular changes, an interim invoice can help to keep track of progress and ensure each section of the project is appropriately funded. It also reduces risk as it ensures clients pay as they go and doesn’t leave you with an enormous unsettled bill.
A typical interim invoice will include all of your standard invoice details (contact details, dates, tasks worked on, etc.) plus some information regarding the projected length of the project.
An interim invoice can also break down the total amount that’s owed over several years. For example, if an architectural firm is hired to design and construct a building over two years, there may be several interim invoices issued over the course of those two years, depending on the initial payment agreement
Final Invoice
A final invoice is an invoice that gets sent at the very end of a project. It may get issued after several interim invoices or another type of intermittent invoice. It may also reflect a deposit or other down payment that was paid.
The purpose of a final invoice is to highlight the total amount owed, as well as confirmed details about the goods or services exchanged.
More so than any other type of invoice, a final invoice must include up-to-date information regarding payment terms, banking information, subtotals and taxes, and any deductions that apply.
The age of digital or e-invoice is here, and invoice templates are making the transition so much smoother.
If you run an SME, your invoicing system plays a particularly crucial role in your relationship with clients. Knowing the ins and outs of these important documents is crucial and having templates that streamline the process is just as important.
Jill Goodwin is a content champion for a variety of online publications. She often covers topics that cater to business owners and entrepreneurs with a strong focus on finances, productivity, management, and a few other topics.