Posted on June 21, 2011
Filed Under (Advice, General Business, Tools) by jennifer

So you’ve made the decision to give online invoicing a try. How do you choose the right solution for your small business?

“Choosing an invoicing solution purely depends on the user’s business requirements,” explained Raju Vegesna, the evangelist for Zoho and an online invoice expert. “If you send out invoices in multiple currencies, it is important to pick a system that supports multiple currencies.”

Similarly, if you regularly send invoices to the same client or clients, it’s important to choose a solution that supports recurring invoices. And if your customers prefer to make payments online (for example via PayPal or Google Checkout), or they prefer to receive printed invoices (via the mail), choose an online invoicing application that supports those things, he said.

Other questions to ask or think about when choosing an online invoicing solution include:

  • How long has the vendor been in business – and has it received favorable reviews from users? Before choosing an online invoicing service, read what others have to say (by doing a Google search or checking out online forums) and ask fellow small business owners which service they use and if they are happy with it.
  • Has the vendor had problems with security and/or data loss or an outage of service? Don’t be afraid to ask the vendor about security and outages – and check with other users if they have experienced any outages or loss of data.
  • Does the service support online payments – and which online gateways does it integrate with? While most online invoicing solutions integrate with PayPal, if your clients use or prefer another payment gateway, make sure the online invoicing solution you choose can support it.
  • Does the service provide online time tracking? This feature can really save users time – and makes generating an invoice simple.
  • Can you customize invoices, beyond just adding your logo? If having a unique-looking invoice is important to your brand, make sure you choose an online invoicing solution that supports easy invoice customization.
  • Is the solution flexible and scalable? Put another way, can it grow with your business (or shrink) – that is, allow you to upgrade or downgrade – without a hassle?
  • Does the service generate automatic reminders? “Automatic reminders solve the etiquette problem and awkwardness of asking your client to pay an overdue bill,” and can save you time, noted Karen Schoellkopk, Community Manager, Harvest.
  • What level of customer support can I expect? If you run into a problem or have a question, is there a number you can call? Or can you only send an email, or submit a question via a form? Are customer service representatives available 24/7 or just during normal business hours (e.g., 9 a.m. to 6 p.m. Central Time), or does it depend on the level of service you purchased? These are important questions to ask up front.

Perhaps most important, find out – by doing a free trial – if the online invoicing service you are thinking of using will actually save you time. “Evaluate it like any business decision,” stated John Coates, the Marketing Communications Lead for FreshBooks. “How does the new solution compare to your current solution for invoicing? If it saves you more hours in billable time than the monthly subscription, it’s worth it.”

For additional information about online invoicing, including how to decide if it’s right for your small business, as well as an overview of three of the leading online billing services, FreshBooks, Harvest, and Zoho Invoice, read my article “Small Business Guide to Online Billing Software” on SmallBusinessComputing.com.

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