What is an Invoice?
An invoice is a document that lists the products and services a business provides to a client and establishes an obligation on the part of the client to pay the business for those products and services.
Invoicing is crucial for small businesses, because invoices are the business documents that enable companies to get paid for their services.
Invoicing is crucial for small businesses, because invoices are the business documents that enable companies to get paid for their services.
How it all began
Stone invoices
Invoices and records of transactions were made as early as 5000 BC in Mesopotamia. The merchants used to carve details of transactions on clay or stone tablets using the earliest form of math.
Hand-written invoices
Invoicing later evolved to hand-written invoices on animal skin, parchment, or paper. These invoices contained most of the elements of a modern invoice and used signatures or seals.
Electronic invoices
The invention of computers brought about the next big change in invoicing. This revolution was triggered by the desire to reduce traditional costs and labor. Invoicing became cheaper, easier, and faster with electronic invoices.
Online invoices
The advent of the internet led to better, more secure, more green ways to communicate with clients. Online invoices are paperless as the invoices are sent through email, and payments are made online.
Mobile invoices
Invoicing in the modern world has gone mobile. Specialized SaaS (Software as a Service) companies ensure that invoicing is now automated, secure, and instant, so you can invoice on the move.
What is it for
Companies need to deliver invoices in order to demand payments. An invoice is a legally binding agreement showing both parties' consent to the quoted price and payment conditions. However, there are other benefits to using invoices.
Maintaining Records
Payment Tracking
Legal Protection
Easy TAX Filing
Business Analytics
Invoice types
Pro forma Invoice
A pro forma invoice is a document that states the commitment of the seller to deliver goods and services to the buyer for an agreed-upon price.
Commercial Invoice
A commercial invoice is a document used for customs declaration in the sale of goods that are exported across international borders.
Credit notes
A credit note is a document issued to the buyer if goods are returned due to damage or mistakes.
Timesheet Invoice
A timesheet invoice is sent to a customer to charge them for work done or services rendered on an hourly basis.
Retainer Invoice
A retainer invoice is sent to a customer if they make an advance payment for a product or service. This amount is then deducted from the customer's final payment on delivery or completion of work.
Recurring Invoice
Recurring invoices are created and sent to customers at regular intervals, for repeating transactions like subscription fees.
Elements of an invoice
A good, legally-sound invoice should contain all the information the customer will need to make payments and provide an avenue to address any questions. Let's take a peek at the various elements of an invoice:
1. The word "INVOICE"
2. Invoice number
3. Date of service rendered
4. Date of sending invoice
5. Contact and name of org / seller
6. Name and contact of buyer
7. Terms and conditions
8. A line detailing each product or service
9. Cost per unit of product
10. Tax rates
11. Total amount owed with currency
12. A personalized note
2. Invoice number
3. Date of service rendered
4. Date of sending invoice
5. Contact and name of org / seller
6. Name and contact of buyer
7. Terms and conditions
8. A line detailing each product or service
9. Cost per unit of product
10. Tax rates
11. Total amount owed with currency
12. A personalized note
Modern invoicing software
Modern invoicing software products from SaaS companies enable you to automate,
speed up, and manage the invoicing process so that you get paid on time.
speed up, and manage the invoicing process so that you get paid on time.
What you can do with invoice software
- Create customized invoicesEnjoy complete freedom over the look and feel of your invoices. Choose a premade template from a gallery and tailor it so you can build your brand the way you want.
- Automate your workflowsSit back and let your software take care of your invoices by automating tedious recurring tasks from invoicing workflows to payment reminders.
- Make payments easy and secureInvoicing software ensures that payments are absolutely secure with PCI DSS compliance. You can even automatically collect payments on a recurring basis.
- Improve customer relationsInvoicing software helps your customer relationships reach a new level. Good invoicing software includes CRM support and a client portal for customers to track their transactions or make payments online.