Excel has been a very powerful tool for many micro and small businesses. Many businesses continue to use Excel for their invoices for volumes less than 10 to 20 invoices per month. They are quite comfortable with that except that they have to review couple of times before sending to Customer, Auditor and the tax Authorities. The flexibility of excel for calculations and design attracts micro and small businesses. Excel is an amazing tool admired by everyone!
But there is an indirect cost involved in following this manual invoicing method or tool which many Businesses do not realise. They always think that going for “Electronic Billing Solution” is quite complicated or costly and does not justify the revenues and volumes of their business.
Let us first analyse the indirect costs involved in excel invoices created manually
Microsoft office is definitely needed and must be upgraded. This is approx. $5 per month. Ofcourse other tools like outlook, power point could be used for the business
In many micro or small businesses, the CEO or the founder plays the key role of invoicing. But what he/she does not realise is that his/her time is very precious and not spend that in creating excel templates and creating invoices manually. Even it is 10min per invoice, it will be easily total up to 1 hour per month. This 1 hour of a CEO or founder of the company is worth $100 per month and $1200 per year
Over and above that, if there is a need to get an overview of the revenues, costs, taxes etc, more hours need to be spent by the owner. What is the cost of that?
Last but not the least, mistakes in invoices could lead to (1) Customer dissatisfaction as money is always sensitive (2) Auditor spends time in consolidating your invoices and his efforts are also charged to you (3) Tax authorities could question any mistakes and can also lead to penalties.
A survey taken with small business owners, provides the following insight on the manual invoicing costs
Cost of excel – Yearly subscription for Microsoft office
Owners costs – Your efforts to create invoices manually, send to your customer, auditors. Clarification to auditors also involved
Auditors costs – Efforts to consolidate your manual invoice and recheck them for tax submission
Performance analysis costs – Owners efforts to track payments, check revenues and to manually get all this data from excel
(survey taken by ITERON Technologies with micro and small businesses of around 500 samples)
In short, the survey results showed that an average small business spends $2000 to $3000 indirect costs which is unforeseen as it is absorbed as part of owner’s efforts.
Question is, why spend this instead of simply using a cloud based electronic billing system for $5 or $10 per month ($60 per year). You save all your indirect costs in manual invoices. You straight away save $2000 approximately per year! Isn’t it?
Let us take a short look at the advantages of a cloud based electronic billing system
Create your master data precisely like your customer, product, prices and reuse them for the invoices
Create invoices based on your master data and all details are precisely calculated as per tax authority compliances
Create pdf as per tax authority specifications including QR code and avoid any penalties
Zero efforts to reconcile as application does all the calculations for you and gives a dashboard for you to take decisions
In one click, send the invoices to your customers
Add your auditor to the application and he does not disturb you for queries.
As you grow, scale up your business easily with sales quotation, sales order, purchase orders etc without additional costs
Above all, Subscribe and pay with zero infrastructure costs
Connect from anywhere anytime from your mobile or systems
CEOs were not aware of the indirect costs spent on manual invoices and to their surprise going for an electronic billing system is just 2% of their current costs. Many were thinking that they put efforts for free in creating excel invoices? But the irony is, if they spend that time in getting leads, convert to customers, build strategies, build partnerships or bill their efforts, they will be profited and increase their revenues
Time do decide!
Are your going to spend your efforts and incur indirect costs for manual invoicing?
Simply subscribe to an electronic billing system and save your efforts?
We, Accqrate ERP, are Zatca approved electronic billing solution provider in Saudi Arabia.