A Beginner’s Guide to Digital Fakturering

The traditional paper based invoicing system can be cumbersome and hence businesses could start using digital invoicing, This is good for the environment as it means less use of paper and also helps businesses cut costs and have a smooth cash flow.

If bills are not paid by customers on time, it can be difficult for a business to function smoothly. Keeping track of all the clients and maintaining records of all the payments in hardcopy files can be time-consuming and stressful. In order to ensure that payments are made on time, businesses can consider implementing an effective invoicing process, such as digital fakturering. However, not everyone might be familiar with digital accounting processes such as e-invoicing. Some common questions that generally arise where e-invoicing is concerned usually are along the lines of what the process involves, how it functions and how it benefits companies. For entrepreneurs and managers new to this process, the following are the basic points related to automated invoicing:

What is digital invoicing?

Digital invoicing is the electronic delivery of invoices and other business related documents from a company to its customers or from one business to another. An invoice indicates what must be paid by the buyer according to the payment terms of the seller. Payment terms generally specify the period of time within which a buyer has to send payment to the seller for the goods and/or services that they have purchased (Debitoor, ELECTRONIC INVOICING - WHAT IS ELECTRONIC INVOICING?, n.d.).

What does this process involve?

There are certain essential components that are needed to create ordinary invoices. For example, invoices carry a professional header which consists of the user’s business name or full name, the logo, etc, at the top of the invoice in a legible font. Invoices also carry client’s information including recipient’s name, address, and phone number and other payment related details such as invoice number, date, due date, payment option, etc. (Rampton J., THE ULTIMATE GUIDE TO INVOICING, Due, 2015). With e-invoicing, these details are automatically categorized and noted by software. Invoices are generated electronically, and sent via an access point to clients and customers. The flow of information takes place over the internet and all records are automatically created, stored and archived using the cloud.

How do companies benefit from it?

Paper invoices are responsible for 10% of all trees cut down worldwide. Using elektroniske fakturaer can help save the environment, which is good for a company’s brand image. Apart from this, companies also cut costs related to the use of paper, postage, etc (Ruisaho M., WHY WE SWITCH TO E-INVOICING AND HOW IT BENEFITS YOU, Greencarrier, 2014). Also, the average time taken to process an e-invoice is only 5 days, whereas for a paper invoice, this duration can extend to more than 23 days. Hence, e-invoicing saves time. Invoices made online are secure and accurate as there are fewer errors as compared to ones made manually. All these are stored directly in digital databases and can be accessed easily and quickly; hence it can be helpful for businesses, while they’re looking for payments made by a specific client or even during an audit trail (Zervant, INFOGRAPHIC: E-INVOICING, A BEGINNER’S GUIDE, 2016).

The above mentioned is a short brief about e-invoicing for beginners. Start ups or small businesses can consider taking the help of companies who provide services related to invoice automation. One such company that provides automatisk fakturering services to businesses is Basware. More information can be found on their website.