Why contractors should send professional invoices
Contractors all have their own unique way of getting the job done – as well as how they charge for their work. Whether you charge by the hour or day, or provide a flat fee for certain types of jobs – you need to clearly outline the contract work you’ve done and the prices you’ve charged.
Easy-to-understand, professional-looking invoices also reinforce your reputation as a reputable and trusted contractor.
Clients will know exactly what they’re paying for, and a consistent invoice template will also help with the organization of your business finances.
Once you've downloaded your free invoice template, you'll need to customize it to fit your specific business. Here are the 10 key things to include on your invoice:
- Title and Description: Name the project and briefly describe what type of work your client is being invoiced for.
- Company Details: Add your company name, address, phone number, and logo to the top-right corner.
- Customer Details: Under "Bill To", add your customer's name, address, and contact information.
- Invoice Number: Include a unique invoice number to help you track down this invoice in the future. You can format this based on sequence and customer. For example, if you're sending your very first customer their first invoice, the invoice number could be 001-001.
- Dates: Include the date when your invoice has been issued and the date when payment is due.
- Line Item: Add individual line items for each unique good or service you provided. For each line item, include a brief description, quantity, individual unit price, and total price.
- Subtotal: Add up the subtotal of your goods or services, before tax has been applied.
- Tax: Indicate the tax rate applied to the subtotal. This is legally required to provide on invoices, and your rate may differ depending on where you run your business.
- Total: Outline the total amount due from the customer, after tax.
- Notes: Include any additional info your customer should know, including terms of service and payment terms (for example, payments are due 30 days after the invoice has been issued).
- Look through the variety of invoice templates we offer and select the one that fits your specific contracting work
- Download the invoice template in the format you want – Word, Excel, PDF, Google Docs, or Google Sheets. It’s free!
- Add your business name, phone number, email address, and other contact information
- Add your logo, website address, and any other business graphics
- Insert your client’s name and contact information
- Generate and add on a unique invoice number or work order number
- Put in the date the work started and finished, or the duration you provided your contracting services
- List labor costs – including a description. If you are charging a flat rate, include the dollar amount for the cost of labor. If you are charging an hourly rate, include the cost per hour and the number of hours spent doing the work
- Add up the total cost for labor
- List materials – including a description of each material, the quantity, and cost per unit
- Add up the total cost for materials
- List any miscellaneous charges – including a description of each and the cost
- Remember that you can add or subtract lines. The template is easily customized to meet the specific contracting project
- If you are including any discounts, add a line explaining the discount so your client knows they are getting a special price
- Calculate the total price you’re charging, including applicable tax, and list the total at the bottom of the invoice
- Include your payment terms, such as the methods of payment you accept, and the payment due date
- If you like, add a personal line at the end – such as a ‘thank you’ for the business, or a note about an interesting aspect of the project
- Save a copy of the invoice – and then send it off to the client
When is the right time to send an invoice to your contracting clients
The best time to send a contracting invoice can vary. Some contractors request partial or even full payment up front. This isn’t unreasonable as you are running your own business and don’t have the resources of a larger company behind you. It also ensures you aren’t working for free. But much depends on the relationship you have with your client. If it is a repeat client, sending an invoice when the work is completed shows trust on your end.
If it’s a new client, you may want to request a portion of your fee upfront to protect yourself against any problems that might occur with an unfamiliar client.
Quick invoicing tips for contractors
Always be courteous
This probably goes without saying, but even the most polite of us can get caught up in the work that has to be done and forget to say ‘please’ and ‘thank you.’ If you’d like these clients to become repeat customers, or spread the word about your great work – be empathetic, kind, and honest (even if they drive you crazy once in a while!)
Be clear about the payment due date
A payment due date will help you get paid promptly. It also reinforces your professionalism – your clients will see you have an established system in place.
Accept a variety of payment methods
Your clients want to pay the way that is most convenient to them, so if you can, be flexible in how you get paid. Accepting e-Transfers, direct bank deposits, and other online methods of payment might help you get paid faster.
Personalize your invoices
A great way to show how much you appreciate your client’s business is to add some personal touches to your invoice. When listing items on the invoice, include descriptions or details that the client specifically requested so they know you were listening to them and went above and beyond to meet their needs. A personal note at the end is always a good idea.
Prepare a detailed proposal or proforma invoice
Make sure your clients know exactly what you will be providing and how much it will cost by sending them a proposal or proforma invoice with your agreed-upon terms and expectations. This can help prevent misunderstandings that can delay payment.
Number your first invoices in your favor
If you are just starting out in your contracting business – it’s not a bad idea to start your invoice number at a higher number than one. It helps reflect the skill you bring to your business – instead of the fact that they are your first client!