This article has been written by Anju V. Kumar pursuing a Personal Branding Program for Corporate Leaders from Skill Arbitrage.

This article has been edited and published by Shashwat Kaushik.

Introduction

Freelancing for women is a great opportunity as it caters to a flexible and independent work environment, contrary to traditional jobs. Women from different walks of life, be they students, working professionals or stay at home moms, are venturing into freelance jobs given the flexibility that it offers in terms of location, time and rewards. Freelancing as a career becomes an ideal choice for any woman who wants to make professional growth without giving up on their personal freedom, as it provides immense opportunities and projects that align with specific lines of interest.

In spite of providing unlimited income growth, a survey by Paypal (as reported by Times of India) has shown that at least 61% of Indian freelancers have faced problems with clients not paying for the work that they have done at least once. A timely and effective billing process can be of utmost importance in ensuring the required cash flow.

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What is billing and why is it important

Billing, as per the Cambridge Dictionary, means the process of sending people bills and asking them to pay the money owed. In the case of freelancers, the clients are being billed based on the services that are provided to them. An effective process of billing ensures that the payments are made regularly and appropriately. It thus becomes important for the freelancers to keep them going and fulfil them to reach their target income. Let us learn about the types of billing and how to arrive at the rates for the same in the following section.

Types of bills for freelance works

Freelancers can bill their clients in two ways:

Fixed rate

The fixed rate (flat rate) for a specific work is the amount you would charge the client for a particular type of work. It is irrespective of the number of hours you may spend on the specific job. These kinds of rates are more suitable to start with any kind of work as a beginner. Though the flat rate is irrespective of the time you would need to finish a particular job, it still needs to be calculated so as to meet the costs and expenses and attain your targeted income. In order to quote a fixed rate, you would thus need to analyse the number of hours you would have to spend on the task, the software or other administrative expenses that you would have to pay for and your profits. After calculating all these parameters, you can quote the fixed rate for a job. 

Even when you quote the same, some clients will negotiate the prices. So it becomes imperative that you also determine a lower threshold for your prices and not go below that.

Hourly rate

The hourly rate gives more flexibility to the overall billing process as it can incorporate the unforeseen and extra hours that you would put into a task. In cases of this kind of billing, tracking the number of hours you put into a task is vital. For that, you can maintain an hours tracking template of your own or make use of the many available tools for the same. The hours can include the preparation time before the actual start of the task, the extra hours that you put for research on the topic, etc. If the tracking template is managed well, then it would be easy to clarify to the client any doubts about the billable hours and increase the trustworthiness of your bill. In case of a correction or rework from your side, you may still add the hours that you have spent working on it and mention it as NO CHARGE.

Invoicing

Once you have a track record of the billable hours, you can prepare invoices for the bill and send them out to clients, irrespective of the billing type. There are a lot of invoicing templates available or you can create one for yourself.

There are a few points to remember that would help you to make promising invoices and thus help the payment process. Some points to be taken care of are:

The invoice should contain all the necessary information

You have to prepare straightforward invoices, which, at a glance, would help the client get all the information required to fulfil the payment. Your invoice should have the number of hours spent with a description, the agreed rate, extra hours put in if any, and the total amount that the client needs to pay.

Have records of all the work listed in the invoice

Make sure you attach all the records of work, hours tracking, and extra work to substantiate the items of work and billable hours mentioned in the invoice. This will ensure that the client gets clarity on the kind of work you have done and that there is very little scope for doubt. This will in turn avoid further clarification emails or calls, which can delay the payment process. Transparency in the invoice would definitely aid in speedy payments.

Invoice at regular intervals

Ensure that invoices are prepared and sent on a regular basis so as not to overload the client with a large amount to pay at a time and also for your own regular cash flow. Frequent invoices do not mean that you keep sending invoices every alternate day or weekly. For work that takes more than three months to complete, a biweekly invoicing schedule would work best. This way of invoicing would help to understand whether the client is a genuine one and if they will eventually pay you after the work gets done. If you wait to send the invoice at the end of three months and if the bill amount is high, it can intimidate the client. On the other hand, if the client is not trustworthy, then it could incur a huge loss to you.

Make professional invoices

In order to ensure timely payments, make use of invoice formats that are professional, have all details of work in legible and attractive font and have important information in bold, like amount payable, no charge works, etc. You can make use of invoicing tools, which can help you with the task of making a digitally attractive invoice.

Mention payment mode

You can also mention the different payment modes that you accept and be flexible to accept the client’s preferred payment method. 

Tips to ensure payments

As a freelancer, you may encounter clients who are often forgetful or defaulting. There are a few tips that can help you get payments but they cannot be guaranteed every time. Here are a few things that you can keep in mind:

Make payment easy for clients

In the invoice, you can list out quite a few payment methods that you would be accepting. You can also mention that you are open to other modes of payment that might be preferred by the client. This will thus encourage the client to make your payment as soon as they receive the invoice.

Send invoices at regular intervals

Sending invoices at regular intervals will help the clients plan for the payment as well. Invoices spaced at regular time intervals will help you understand the trustworthiness of the client and prevent huge losses at the end. 

Offer discounts for timely payment

You can mention discounts for timely payment within a stipulated time period and also penalties for late payment beyond a certain date. 

Request for adhoc payment

For certain types of works that require the use of certain interfaces or software to start with, you can always request advance payments. This is also a way to find out whether the client is genuinely interested in getting the work done with you.

Be confident with the payment request

Whenever you have to approach the client with a payment request, be confident and firm. This will help your request to be taken seriously by the client and not rejected. Whenever there is scope for any extra work other than what was agreed upon, an additional payment request for the extra work can be sent to the client, citing the implications.

Maintain a healthy relationship with client

The communications made to the client have to be straightforward and friendly at the same time. Before starting with the payment request, you can always check whether they are happy with the work that you have provided them. A healthy relationship with the clients will ensure that you are considered for future work and result in long term collaboration.

Send reminders for late payment

It is completely alright to send reminders for payments not made on time. The reminders have to be friendly and not intimidating. You can mention the impacts of late payments on your cash flow. You can also send a reminder well ahead of the penalty clause, apprising them about the late payment fees that would kick in beyond a certain date. This will mostly put pressure on the client to make the payment before the penalty starts. 

Documentation

Documentation of every request and communication made with the client is of utmost importance. Any communication with regards to extra work or an additional rate that has been agreed upon or requested will help with clarification at the time of invoice submission.

Make a call

If all the reminders through emails are unanswered, you can make a call to the client. Start by introducing yourself and asking for the payments, assuming that they have missed your email reminders, as there are always chances that your email might have missed their attention.

Conclusion

Freelance work seems to be the new way forward for many women who had to quit their regular jobs or who are stuck in their current jobs for many reasons. It has paved the way for a more independent and flexible work environment across the globe. With the advent of digital technology, women are feeling empowered and can work from any location at any point in time. 

While the prospects of remote working are numerous, it is equally important for women to focus on their targeted income and financial independence. An effective and regular billing structure plays a great role in ensuring the same. With an impressive invoice, precise information about the work and hours spent on it, a positive relationship with the client and friendly/timely reminders, you can always increase your chances of getting paid appropriately and timely.

References

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