In the world of business, invoices are very important. They ensure clarity and accountability between parties. But did you know that invoices come in various forms, each tailored to different business needs?
In this blog post, we will explore the diverse invoice types, uncovering nine essential invoices that can ease your business endeavors.
9 Types of Invoices
Here is a list of different types of invoices, and the basic things you should know about them.
1. Standard Invoice:
A standard invoice is also known as basic invoice. A standard invoice is a document detailing goods or services provided along with payment terms. It is the most common type of invoice that businesses create. It usually includes basic information such as business name, business contact information, client’s name, and contact information, then the amount involved.
2. Recurring Invoice:
Recurring invoices are for businesses that offer subscription services or ongoing contracts. Cloud-based software allows you to automate the billing cycle, ensuring timely payments without the hassle of manual invoicing. With e-signatures seamlessly integrated, recurring invoices are a breeze to manage, keeping cash flow steady and predictable.
3. Proforma Invoice:
A proforma invoice is used to quote prices in advance for products or services. This type of invoice details the estimated cost of work to be done, delivery details, and any additional detail that pertains to the agreement between both parties. Upon agreement by the receiving party, the business starts to work on delivering its end of the bargain.
4. Credit Invoice:
A credit invoice is also known as a credit note or credit memo. This type of invoice is issued when a business wants to provide a discount, refund, or correct a previous mistake made on an invoice.
5. Debit Invoice:
On the flip side, debit invoices come into play when additional charges or adjustments are necessary.
For example, if your previous invoice was to cater to some services and you ended up providing more, a debit invoice can be sent to this effect.
6. Commercial Invoice:
A commercial invoice is used in the case of cross-border (read as international) transactions, it is used as proof for legal reasons. The details of this invoice provide information like taxes, description of goods, volume of goods, country codes, etc.
7. Interim Invoice:
An interim invoice is used for project-based businesses, where the client and business agree on terms to pay multiple payments as milestones are hit during the project duration. This would keep cash flow steady throughout the project lifecycle.
8. Final Invoice:
Ah, the sweet satisfaction of completion! The final invoice marks the end of a project or transaction, tallying up the total amount owed and wrapping up loose ends. A final invoice is sent at the end of the project. It showcases the amount owed after deducting interim payments.
9. Electronic Invoice (e-invoice):
We live in a digital world where paper invoices are a thing of the past. E-invoices offer a sustainable and efficient alternative, reducing costs and environmental impact. With e-signatures, businesses can embrace the digital revolution fully, transforming their invoicing processes for the better.
Mastering the art of invoicing is key to running a successful business. By understanding the different types of invoices and leveraging e-signature solutions like Flowmono, businesses can make their billing processes more efficient, reduce administrative burdens, and ensure compliance with regulations. Flowmono also provides additional services that allow you comment for review or changes on your invoices, single and multiple signings when sending out invoices for approvals, and lots more.