Management Smarts

Tips and trends for growing your business
Magazine Contributor
3 min read

This story appears in the February 1996 issue of Entrepreneur. Subscribe »

In the ongoing battle to get paid on time, two of your most effective weapons are well-designed invoices and billing statements. Start by understanding the document's purpose, advises Frank Uhlman, a collections expert at the Commercial Law League of America.

"The invoice describes a particular purchase," Uhlman says. "Statements, or bills, are usually sent monthly and list the invoice numbers and dollar amounts of purchases and payments made during the billing period."

Clarity is a critical element of both documents. "The invoice should contain enough information to deflect any possibility of a delayed payment because of confusion as to what the bill is for," Uhlman says.

In addition to your own internal coding (such as the customer account number, salesperson and so on), the invoice should include a complete, clear description of what was purchased, avoiding unclear abbreviations. Specify quantities purchased, unit prices and totals; show the customer's purchase order or other reference information to identify the transaction; and clearly indicate the terms so the customer knows when payment is due and whether a discount for early payment is offered.

The statement should summarize the transactions made during the billing period. Keep related information together, and use graphics to call attention to important information. Include a duplicate copy or perforated piece the customer can return to help you apply payment properly.

Uhlman says invoices and statements should be designed from the buyer's viewpoint, not the seller's. You may want to select a group of customers to review your documents, and use that input as a basis for improvement.

Fax Faux Pas

If your faxes are making foes, not friends, perhaps it's because you're oblivious to the finer points of fax etiquette. Curtis Michelson, whose Orlando, Florida, company, Access Publishing Inc., produces a daily fax news magazine, offers these tips for making sure your faxed messages are positively received:

Don't fax unsolicited marketing material. "Remember, the receiver is paying for the fax paper and toner," Michelson says.

Keep elaborate designs to a minimum. Complicated logos, fancy borders and custom letterheads on cover sheets and other documents slow your transmissions, tying up lines and inflating phone bills. "If you want to use large, bold type, try an outline font instead [of a dark font]-the visual impact is the same, but the transmission is much quicker," says Michelson.

Call before sending long documents. "It's a matter of courtesy to alert someone that you're going to be tying up their machine," Michelson says.

Get permission for late-night faxes. If the recipient operates from a home-based office, a middle-of-the-night call may not be welcome.

Character Study

Successful entrepreneurs have a lot in common. "They have a high need for achievement," says Susan E. Murphy, interim director of the Kravis Leadership Institute at Claremont McKenna College in Claremont, California. "They have a high tolerance for ambiguity and are comfortable adding their own structure to ambiguous situations. They usually have a single vision they do not swerve from, and they believe they control their own destinies."

These characteristics can be developed into strong leadership skills. Murphy advises putting yourself in difficult situations that challenge and stretch your abilities. If you fail? Learn from the experience and keep going.

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