It's no surprise that technology is transforming the world of commerce.
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A user-friendly website and a calculated internet marketing campaign can level the playing field and make it easier for your small businesses to compete with the big guys.
But did you know that technology might also be capable of making more mundane tasks like billing and invoicing a little easier, too?
It's true. They call it EIP (Electronic Invoicing and Payment) and if it's the right fit for your business, it could save your company time, money, and the headaches that come with managing a paper invoicing system. But like everything else, EIP has both advantages and disadvantages.
Before you discard the old system entirely, here are a few things you ought to consider.
Not all small businesses are on the same page when it comes to technology. Some have enthusiastically jumped onboard the technology bandwagon while others have come aboard kicking and screaming.
With that in mind, your first consideration has to be whether or not your business is technologically prepared to make the transition to an electronic invoicing system.
Fortunately, the marketplace offers EIP solutions for technologically complex businesses and technologically simple ones alike. But even the most basic EIP solution requires a certain amount of technological capacity since nearly all of these systems are designed to be integrated with your company's bookkeeping software.
If you are still maintaining financial records in a handwritten ledger, then forget it - EIP isn't for you (at least not yet.) However, if you already use a basic accounting software package like Quickbooks or Peachtree, then EIP might be a logical next step.
It makes sense that EIP can save money for your business. Every account that is invoiced electronically is an account that doesn't require a monthly stamp and envelope. Add that up over the course of a year and you're talking about a nice little boost to your bottom line.
But (surprise, surprise) EIP costs something, too. If you decide to go with an in-house EIP system, expect to spend several hundred dollars or more on software and possible hardware upgrades.
If you find technology to be a dizzying experience, you could also decide to go with an EIP solutions provider. For a fee, EIP solutions providers will handle the headache of electronic invoicing for you. This could be an attractive option if your business has a high volume of invoices and limited technology.
If you want to keep it simple, you can just prepare your invoice in Excel using an Excel invoicing template. Then, convert the Excel file to an Adobe Acrobat PDF and email the invoice to your customer. It's crude, but it works!
Maybe the biggest advantage of EIP is turnaround time. Paper invoicing systems have a built-in delay based on the amount of time that is required for the postal service to deliver the invoice to the customer as well as the time it takes for the customer's check to reach your front door.
However, an EIP system combined with the ability to make electronic payments makes it possible for the customer to receive the invoice instantaneously and dramatically reduces the turnaround time for payment.
If time is money, then EIP could potentially be a money-maker for your small business.