Invoicing is an important part of any business. The process of creating invoice templates and using invoicing tools to send invoices to customers is a crucial step toward requesting payment for goods or services provided.
Business owners also receive invoices from wholesale dropshipping suppliers and distribution warehouses for goods ordered to run daily operations. For instance, a fine dining restaurant business can receive a proforma invoice for the supply of wholesale meat from a wholesale distributorship.
Key Takeaway - The invoice management system not only oversees sending invoices to customers. It also manages the way the accounts payable department, AP, processes the invoices received from suppliers.
Smart invoice management solutions will streamline the process of managing invoices and payments. Businesses can also track merchandise inventory and manage excess inventory. Besides these, invoice management software can be integrated with warehouse inventory management and ERP wholesale systems.
This blog reviews the best invoicing and inventory management software for businesses. However, what is invoicing management system? Let’s find out.
What Is Invoice Management System?
An invoice management system is an automatic invoicing tool or platform that manages and tracks invoices sent to customers and received from suppliers. The system streamlines and automates the invoicing, purchase, and payment process.
Web-based invoice management platforms help businesses optimize invoice control processes. This covers invoice processing activities for vendors and sending invoices to customers.
As a business owner, cutting the time spent performing non-sales tasks is crucial to increasing productivity and efficiency. From creating the right type of customer invoice and invoice matching to verifying and approving a vendor’s invoice, using a manual invoicing method can take time.
More businesses are transitioning from using manual business processes to using automated solutions. Investing in an automated invoice management process will reduce the amount of money spent processing invoices.
Relying on too many extensive tools for business operations is expensive and can be difficult to manage. However, using a system that can combine the top features of the best invoice management system and inventory management system will save money and enhance billing workflows.
Besides being able to do more than invoice processing, what other benefits will you get from an invoice management system? Let’s review the benefits of using an invoice management tool.
4 Benefits of Invoice Management Software
Switching from manual accounting and billing processes will greatly benefit your business. Not convinced as to why you need to use an automated billing and invoice management system? Let’s look at some benefits of invoice management software for businesses.
- Invoice Processing
To run a profitable business, you need to reduce all unnecessary expenses. The cost of processing invoices for a small business is $15.98 per single invoice and $40 if you are the one issuing the invoice to customers
Using invoice management software cuts invoice processing to $12.98 per single invoice. It also doubles the speed of the invoice processing workflow. An invoice management system automates the entire business process flow.
Businesses can eliminate human errors associated with the manual filing and approval of invoices. You can also build a better supplier relationship management system when you pay their invoices on time.
- Data Processing
As your business grows, your customer and vendor base will also expand. This means you have more invoices to process, opening room for potential errors with invoice processing and filing.
Using an invoice management tool will eliminate the chances of having errors or typos while creating and processing invoices. With your account payable and account receivable functions automated, you don’t have to worry about manually writing down information in spreadsheets.
This also means you can easily access vendor data or customer information when you need it. You can archive invoices with a simple click and get ready for an audit faster.
- Premade Invoice Templates
Every business can benefit from the premade invoice templates that invoice management software offers. These templates are usually customizable. You can add your personalized business logo, fonts, and colors.
You only need to fill the invoice elements provided and with a simple click, a professional invoice is ready to be sent to your customers. An invoicing management system can save the imputed data in the cloud. This makes it easier to create another invoice.
- Third-party Integration
You can directly integrate an invoice management system with payment processing software or the best business bank account to accept payments online. This makes it easy for customers to pay bills after receiving your invoice.
The easy payment processing and eCommerce accounting system integration makes it easy to receive and manage returns. You can issue refunds or credits directly from your dashboard.
5 Features of Invoice Management Tools
There are lots of invoicing tools and invoice management platforms online. However, before you make a selection for your business, it’s important to check the features of the invoice management software.
Now that you know the top benefits of an invoice management system, let’s look at some features of invoice management tools.
- Auto Matched Invoices: This feature allows you to automatically match invoices with vendor and customer information, purchase orders, and invoice P.O number.
- Encrypted Billing: This feature makes it possible for customers to pay securely online. Encrypted invoicing software makes it easy to protect customers' personal information.
- Integrated Payment Tracking: This feature helps your team to stay on top of payment transactions. You can track overdue payments and get notifications for failed payments.
- Customized Reports: This feature allows you to create customized reports of transactions. You can select the reports you need for auditing and tax purposes.
- Managed Customer Accounts: This feature allows you to manage individual customer accounts and keep track of their orders. You can also manage vendors' and suppliers’ accounts.
3 Best Invoice Management System
Let’s review the three best invoice management systems for business owners.
- BlueCart
BlueCart is an all-in-one B2B eCommerce solution for food distribution businesses, wholesalers and retailers, and restaurant businesses in the hospitality, and the food and beverage industry. This invoice management system streamlines the entire invoice processing workflow and makes it easy to stay on top of billing and accounting activities.
As a B2B eCommerce solution provider and wholesale marketplace online, BlueCart offers the best payment and invoicing solutions for businesses. From recurring billing management and inventory management to processing orders and order fulfillment, BlueCart does more than just invoice processing.
Features of BlueCart Invoice Management System
- Create invoices from orders.
- Modify product and invoice information
- Create credit memos automatically when the quantity ordered is different from the invoice quantity.
- Use paperless billing to send digital invoices, receive status updates, and collect payments on the go.
- Reduce the turnaround time for receiving and completing a return.
- Create partial order invoices and take advantage of automatic invoice reconciliation.
- Zoho Invoice
Zoho Books invoice management software is an invoicing solution for small businesses. The platform allows you to create invoices, process incoming invoices, and automate accounting workflows.
Features of Zoho Invoice Management System
- Automate invoice processing.
- Customize invoice creation.
- Integrate third-party billing and payment software.
- Accept payments online.
- Xero
Xero is an accounting and invoicing software for businesses. This cloud-based accounting and invoicing system allow you to automate and optimize your invoice processing workflow.
Features of Xero Invoice Management System
- Send automatic reminders for late payments.
- Track payments and vendor invoices from the easy-to-use dashboard.
- Turn quotes to invoices.
- Send bulk invoices at once to customers.
Frequently Asked Questions About Invoice Management
Invoice management is a crucial part of your business. Automating the entire invoicing process will save you time and money. Let’s answer some common questions about invoice management.
What are the Unique Features of Billing Software?
Before choosing a billing software, look out for these unique features:
- Simplicity: The billing software must have an easy-to-use interface. It should also make it easy to understand complex billing and accounting transactions.
- Compliance: Your billing software must comply with PCI regulations and various data protection laws.
- Dunning management: This feature makes it easy to reduce failed payments and churning. Dunning management is important for subscription billing business models.
- Third-party Integrations: This allows you to integrate other important software. You can integrate APIs and webhooks which allow you to track inventory, accept payments online, manage shipping and handling of invoices, and monitor billing and contract cycles.
Why Is Invoice Management Important?
Invoice management is important to keep track of sales and manage excess inventory. You can regulate your inventory with a great invoice management tool like BlueCart. Invoice management helps to streamline the way you process vendor invoices, request payment from customers, and eliminate processing errors.
What Is a P2P Cycle?
A P2P (procure-to-pay) cycle, is a full cycle or workflow of processes that a business engages in when procuring goods or services from external vendors. The cycle involves requisitioning, purchasing, receiving, paying for, and taking account of goods and services. A P2P cycle begins when a business places an order with a supplier and ends after payment.
Time to Take the Next Steps
An invoice management system is designed to make your billing and invoicing processes run smoothly. Taking advantage of these tech advancements will improve your entire business process and increase overall efficiency.
When choosing an invoice management system for your business, remember to do a test run of its features and functionality. Automating your invoice management process is a great move for your accounting and payment process.