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Invoicing 101: Back to the Basics

iaminfluenceallJune 8, 2022

Let’s get back to basics.

This month we want to share some helpful guidance on invoicing, one of the most important parts of the influencer marketing campaign process. An invoice is a record of the transaction between a buyer (the brand) and seller (the influencer) and lists the services (such as content deliverables, usage, and/or any other fees, etc.) exchanged for money. The invoice serves to show an obligation on the part of the buyer to pay. Invoices are an essential part of any business, big or small, especially for the accounting and bookkeeping side of operations.

One of the ways I+AM aims to fully support its creators is by taking on the backend invoicing process with brand and agency partners, and ensuring that the project is paid out in a timely manner. We sat down with I+AM’s Operations Coordinator, Rebecca, who shared her helpful guidelines on invoicing.

Can you share a brief intro on yourself and what your day-to-day role is at I+AM?

I joined I+AM in the fall of 2020 as Office Assistant and eventually grew into the role of Operations Coordinator. Now, I take care of all things payment-related – from accounts receivable and accounts payable, including invoicing all brand and agency partners, as well as executing pay runs to our talent, and overseeing I+AM’s day-to-day operations under our Agency Director. My daily goals are to ensure our influencers are fully compensated in accordance with their contracts and help our clients with any questions they may have throughout the payment process.

What are the most important elements of a valid invoice?

There are many different ways to create an invoice, however there is essential information that should appear each time in order to help your customer issue payment with ease. 

  • Ensure your own billing details appear clearly and accurately on the invoice: your full name and/or business name to which payment must be made payable to, mailing address, and any tax registration you may have. 
  • Include the billing details of the agency or brand who contracted you for the project.
  • In the description, specify the name of the brand you worked on, perhaps even the campaign name, along with the deliverables so it’s clear to the finance team which project your invoice is for. You may be asked to include a Purchase Order number, so keep an eye on your inbox for any requests to update your invoice.
  • Add a footnote which lists your accepted payment methods and any fees that may be applicable. When negotiating your contract, you’ll want to try to get these fees included as a clause so you’re fully covered when it comes time for the brand to remit payment.
  • If you are registered with the government to collect sales tax, make sure to include your tax number directly on the invoice. . The amount of sales tax you charge depends on what state/province the customer is based in, so ensure you also receive their details. In most circumstances, you cannot apply sales tax to an international customer;or example, if you’re based in Canada and your client is in the USA, you can’t charge them sales tax if you’re not incorporated in the States.. If you’re based in the US, you can read more about sales tax here; and if you’re based in Canada, you can read more about Canadian sales tax here.
  • Include the date the invoice was created, as well as the payment due date. The due date is based off of the payment terms agreed to in the contract which are often between Net30-Net90 days. An invoice with Net30 terms usually means the customer must pay the invoice within 30 days (not business days!) from the date the invoice was made. 
  • Most importantly – be sure to clearly list the full amount and currency you were contracted for in addition to any reimbursements you’re entitled to. If a specific payment method was agreed to, include its fees as a separate line item on the invoice so you end up with the full amount for the project.

What platform do you use to create/send invoices? How is this different from creating one on Word yourself?

I+AM uses QuickBooks Online to create invoices and record payments. I adore this platform because it makes it so easy to send invoices directly to our clients, see when the invoice was sent & viewed, make edits, and record when & how we receive payment. 

Using a template on Microsoft Word or Excel may be a decent option if you’re just starting out, however once you grow your following (and your quantity of campaigns along with it!) you may want to invest in a software that makes your invoicing process more efficient. With a platform like QuickBooks, you’ll also have a much easier time pulling a report of your earnings for your accountant during tax season and following up on late or upcoming payments.

What are best practices for setting clear payment terms and submitting an invoice?

It’s best practice to get things like payment terms, fees, and methods included in your contract so you’ve got a good understanding of when and how you’ll be paid. When it comes time for you to invoice, keep your contract on hand so you can ensure your invoice is aligned with the terms of the contract. Finally, sending your invoice in an email directly to the consumer is a great way to keep record of the date it’s sent and for the recipient to confirm they received it.

Do you have any tips on how to respectfully follow up on overdue payments?

You can send a friendly reminder a couple of days before the invoice due date to remind your customer of the upcoming payment. At this time you can also ask them to let you know if they need any information from you prior to issuing the payment, like your W9 or your complete bank details.

Maintain an amicable tone when following up on your overdue payments, however don’t be afraid to get firm if you aren’t getting a response. You fulfilled your mandate and it’s your customer’s responsibility to allow for open communication on the status of your compensation. I like to create email templates as sometimes following up on overdue invoices can take days to get a response, and it saves me from typing the same thing over again. 

Navigating the business/accounting aspects of the influencer campaign process can be daunting but I+AM’s full-service management team has you covered. If you aren’t currently represented by management, we hope these guidelines help you better understand the importance of having a valid invoice, not only for your bookkeeping purposes but for your counterpart brand partner to have a record of the collaboration as well. 

 

Resources: https://quickbooks.intuit.com/ca/resources/invoicing/what-is-included-on-an-invoice/

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