There are many positive aspects to having a freelance business.
But like any business, there are administrative tasks that go along with the fun stuff. You only get work if you you’re successful with your freelance proposals, for instance. And, in particular, you want to be paid for your work, so you need to bill clients using adequate invoice templates to ensure the payment happens. There are plenty invoicing software options to help with the process.
The longer you wait to invoice, the longer it takes for you to get paid. Or you risk not getting paid at all. You want a consistent cash flow, so invoicing and deciding your invoice number meaning are necessary tasks for your business.
But first, what is an invoice? As freelancer Linsey Knerl says,“Invoices are key to helping you meet your most important business obligations. Your freelance business is worth nothing if you don’t get paid – no matter how talented or in-demand you are.”
One of the components of freelance invoicing is having a system that makes it easy to track invoices and enables simple bookkeeping. An invoice numbering system (one of many must-know invoicing terms) is an important component of your invoicing system. So it’s good to figure out the meaning of invoice numbers and a system that works for you, in particular if you’re going to manage invoicing on your own.
Let’s look at options for your invoice number meaning, including what is invoice number and how to number invoices.
If you’d like to manage your own invoice system, there are few ways to accomplish that. You can start with a blank invoice template - Microsoft Excel has such templates, so if you’re comfortable using Excel, you can use it to establish your system, but you'll still need to establish your own invoice number meaning.
In Excel, there are several invoice templates from which to choose, with the “service invoice” likely being the most applicable for a freelance business. Once you have the template open, you can edit it to your liking.
Here are some things to include on each invoice:
If you work on a retainer basis, the invoice could also include information related to the work done during the time period covered by the invoice.
Now you can determine your invoice number meaning and set up a invoice numbering system, with a few options available.
Did you know that you can use Bonsai to generate and send a beautiful custom invoice in just 2 minutes? Using a freelance invoice template can help eliminate errors on your invoices. Let's see how.
First, just head to your dashboard and click on "send an invoice" from the top right.
Now you'll have to choose or create the client and project for which you want to send the invoice. Once those are set up, just click on "create invoice".
You'll be directed to the invoice editor, where you can set up basic information for you and the client, add all the items to the invoice, and finally send it to your client by clicking on "send now".
Did you like Bonsai's workflow for sending invoices? If you did and want to try it out for yourself, or if you are interested to discover the other integrated components of the product, just sign up for a free trial.
It can be argued that the invoice number is one of the most important components of an invoice – other than the amount owed, of course. That's why it's important to have a firm grasp on what is invoice number.
Having a numbering system allows you a means to identify each invoice. It also allows you to search for an invoice or a copy of it, and it lets you set up a system to track when invoices have been paid. It can even help at tax time if you need to find specific invoices.
From a customer’s perspective, an invoice number is also how they keep track of payments due and payments made in their accounting system.
There are considerations to invoice number rules, however, such as the message that invoice numbers can send to clients. For instance, if you use small numbers like 10 or 15, you may lower trust in your business because it looks like you’ve only had a few clients. Even if you haven’t been in business long, this may not be the image you want clients to see.
So how to number invoices? Here are some options:
You can also combine these, using a project number and a date, for instance. Your invoice number meaning is up to you, so feel free to adjust your invoice numbering system according to your needs.
These are just a few ideas. You can also rely on Excel or another spreadsheet software to auto-generate and assign a invoice number for you.
However you choose to do, ensure every invoice number is unique, and ensure you build in enough room for growth. A three-digit invoice system will quickly run out of numbers as your business grows.
Another choice for an invoicing system is to use a professional invoicing product like the one offered by Bonsai. Such a system will ensure you don’t need to make a decision about a invoice numbering system – it will do it for you!
As well, an automated system will allow you to leave behind spreadsheets and manual invoicing, and have your office available to you wherever you go.
Here are some of the great things the Bonsai freelance invoicing system will do for you and your business:
An advantage to using a system like this is that it automates the process for you, and frees up your time for your actual freelance work. Bonsai offers a free trial of its services, which includes the invoicing platform.
Such an automated system offers other benefits to your business. It can improve customer relations, because customers know what to expect as invoicing is consistent. It’s also modern and professional, which is a good image to portray to your customers. On top of that, it puts one of the best project management tools for freelancers at your disposal.
It’s simpler for you, and you always have access to what you need. It can help reduce your costs in the long run, because you have automated a manual process, which may have even included mailing costs. That makes it environmentally friendly as well.
Since getting paid for your work is one of the most important parts of having a business, it follows that invoicing is one of the most important administrative tasks in your freelance business.
This includes creating invoices with a numbering system that allows for tracking and filing. It includes getting the invoices to customers in a timely manner. It includes tracking the payment of those invoices, and the ability to look back at invoices, for instance at tax time.
If you’re ready to move to an automated invoicing system that leaves you more time for what you love about having a freelance business, stop worrying about how to number invoices and sign up for a free trial of Bonsai.
A verbal contract (formally called an oral contract) refers to an agreement between two parties that's made —you guessed it— verbally.
Formal contracts, like those between an employee and an employer, are typically written down. However, some professional transactions take place based on verbally agreed terms.
Freelancers are a good example of this. Often, freelancers will take on projects having agreed on the terms and payment via the phone, or an email. Unfortunately, sometimes clients don't pull through on their agreements, and hardworking freelancers can find themselves out of pocket and wondering whether a legal battle is worth all the hassle.
The main differences between written and oral contracts are that the former is signed and documented, whereas the latter is solely attributed to verbal communication.
Verbal contracts are a bit of a gray area for most people unfamiliar with contract law —which is most of us, right?— due to the fact that there's no physical evidence to support the claims made by the implemented parties.
For any contract (written or verbal) to be binding, there are four major elements which need to be in place. The crucial elements of a contract are as follows:
Therefore, an oral agreement has legal validity if all of these elements are present. However, verbal contracts can be difficult to enforce in a court of law. In the next section, we take a look at how oral agreements hold up in court.
Most business professionals are wary of entering into contracts orally because they can difficult to enforce in the face of the law.
If an oral contract is brought in front of a court of law, there is increased risk of one party (or both!) lying about the initial terms of the agreement. This is problematic for the court, as there's no unbiased way to conclude the case; often, this will result in the case being disregarded. Moreover, it can be difficult to outline contract defects if it's not in writing.
That being said, there are plenty of situations where enforceable contracts do not need to be written or spoken, they're simply implied. For instance, when you buy milk from a store, you give something in exchange for something else and enter into an implied contract, in this case - money is exchanged for goods.
There are some types of contracts which must be in writing.
The Statute of Frauds is a legal statute which states that certain kinds of contracts must be executed in writing and signed by the parties involved. The Statute of Frauds has been adopted in almost all U.S states, and requires a written contract for the following purposes:
Typically, a court of law won't enforce an oral agreement in any of these circumstances under the statute. Instead, a written document is required to make the contract enforceable.
Contract law is generally doesn't favor contracts agreed upon verbally. A verbal agreement is difficult to prove, and can be used by those intent on committing fraud. For that reason, it's always best to put any agreements in writing and ensure all parties have fully understood and consented to signing.
Verbal agreements can be proven with actions in the absence of physical documentation. Any oral promise to provide the sale of goods or perform a service that you agreed to counts as a valid contract. So, when facing a court of law, what evidence can you provide to enforce a verbal agreement?
Unfortunately, without solid proof, it may be difficult to convince a court of the legality of an oral contract. Without witnesses to testify to the oral agreement taking place or other forms of evidence, oral contracts won't stand up in court. Instead, it becomes a matter of "he-said-she-said" - which legal professionals definitely don't have time for!
If you were to enter into a verbal contract, it's recommended to follow up with an email or a letter confirming the offer, the terms of the agreement , and payment conditions. The more you can document the elements of a contract, the better your chances of legally enforcing a oral contract.
Another option is to make a recording of the conversation where the agreement is verbalized. This can be used to support your claims in the absence of a written agreement. However, it's always best to gain the permission of the other involved parties before hitting record.
Fundamentally, most verbal agreements are legally valid as long as they meet all the requirements for a contract. However, if you were to go to court over one party not fulfilling the terms of the contract, proving that the interaction took place can be extremely taxing.
So, ultimately, the question is: written or verbal agreements?
Any good lawyer, contract law firm, or legal professional would advise you to make sure you formalize any professional agreement with a written agreement. Written contracts provide a secure testament to the conditions that were agreed and signed by the two parties involved. If it comes to it, a physical contract is much easier to eviden in legal circumstances.
Freelancers, in particular, should be aware of the extra security that digital contracts may provide. Many people choose to stick to executing contracts verbally because they're not sure how to write a contract, or they think writing out the contract terms is too complicated or requires expensive legal advice. However, this is no longer the case.
Today, we have a world of resources available at our fingertips. The internet is a treasure trove of invaluable information, platforms, and software that simplifies our lives. Creating, signing, and sending contracts has never been easier. What's more, you don't have to rely on a hiring a lawyer to explain all that legal jargon anymore.
There are plenty of tools available online for freelancers to use for guidance when drafting digital contracts. Tools like Bonsai provide a range of customizable, vetted contract templates for all kinds of freelance professionals. No matter what industry you're operating in, Bonsai has a professional template to offer.
A written contract makes the agreement much easier to prove the terms of the agreement in case something were to go awry. The two parties involved can rest assured that they're legal rights are protected, and the terms of the contract are sufficiently documented. Plus, it provides both parties with peace of mind to focus on the tasks at hand.
Bonsai's product suite for freelancers allows users to make contracts from scratch, or using professional templates, and sign them using an online signature maker.
With Bonsai, you can streamline and automate all of the boring back-office tasks that come with being a freelancer. From creating proposals that clients can't say no to, to sealing the deal with a professional contract - Bonsai will revolutionize the way you do business as a freelancer.
Why not secure your business today and sign up for a free trial?