Why do you invoice in advance?

August 24, 2019
Posted in Sales
August 24, 2019 Brett Farmiloe

Why do you invoice in advance?

Every once in awhile we will have a customer ask why we invoice for the services of the month ahead on the 1st of the month.

There are two reasons. Invoicing in advance helps cover our monthly expenses and reduces bad debt.

Monthly Expenses 

Like all businesses, we need income to cover expenses. We have large monthly expenses like wages, and smaller expenses like rent, electricity, and subscriptions to marketing tools. 

Without cash to pay employees, we don’t have people to do the work

That’s the main reason why we invoice in advance. We need to pay people and bills throughout the month to drive results for clients.

Bad Debt

Unfortunately, there are people who don’t pay their bill. Invoicing in advance reduces the risk of doing free work. 

We have had one too many experiences of not being paid (and trust us, it only takes one experience to realize this isn’t a fun thing to encounter). 

To reduce being ghosted and taking on bad debt, we invoice on the 1st of the month.

We begin work immediately upon receipt of our signed contract. But, no work is delivered until our first monthly payment is received. For monthly payments, we bill clients the first of every month with payments due within 30 days. Then, we suspend work if payments lapse beyond 45 days.

Pretty standard stuff. If you have additional billing questions, contact us and we’d be happy to talk more.

Brett Farmiloe

Brett Farmiloe is the Founder & CEO of Markitors, a digital marketing company voted a best place to work 3 years in a row. Born and raised in Santa Rosa, he frequently contributes content about SEO, Careers, and Culture to media outlets. And, as a dad of 3, he's about that minivan life.