Are you still using Excel to manage your invoicing? This habit isn’t as efficient as you think…
According to a report by Ray Panko(1), emeritus professor of management information systems, 90% of Excel spreadsheets contain errors. In 2012, a copy/paste mistake in an Excel spreadsheet cost the American bank JP Morgan $2 billion(2).
Even if you like it because it’s free, favoring Microsoft’s spreadsheet for your invoicing carries more risks than benefits for your business. In addition, since 2018 the law requires the use of secure, tamper-proof software capable of preserving and archiving data. Excel hardly meets all these requirements.
At a time when many management solutions exist to drive your business processes, Codeur.com and Axonaut present 6 reasons to ditch Excel for your invoicing!
1. Save time in your daily management
Using Excel for invoicing requires many manual actions to create, edit, proofread, correct… One wrong move can quickly create VAT anomalies, errors in terms and conditions, customer contact details, or simply in the total amount to bill.
Each month you have to repeat the same actions, change the invoice number, even if the services remain essentially the same. The same applies to estimates.
Result: you spend more time formatting your documents and proofreading them to ensure compliance.
As the owner of a small business, that’s not good news for your operations! It’s wasted time you could devote to prospects and customers.
By choosing invoicing software, you get one or more templates that are easy to auto-fill. This prevents errors while minimizing the time spent on documents.
Finally, with a specialized tool, you automatically convert your quotes into invoices. There too, it's a precious time-saver!
2. Ensure better cash flow monitoring
Excel invoices limit your ability to track cash flow. First, you have to manually edit each invoice when it's paid, then open it later to remind yourself whether it's been paid or not. With a management tool, you can see payments made and outstanding invoices at a glance.
Besides, Excel makes it difficult to get a complete view of your company's financial health. You can tinker with spreadsheets and formulas, but it's tedious and the smallest mistake can distort your numbers.
By contrast, thanks to a management software dedicated to small businesses, you can view cash flow in real time. You set up alerts for payments received, late customers, and unpaid invoices.
Most of these tools let you follow up with clients in one click. You can also add payment links to your invoices and speed up the payment process — which is impossible with Excel.
3. Improve accounting collaboration
Do you have an accountant? Sending them Excel spreadsheets can be tedious. All the more so since most professionals work with accounting software.
With a management solution, you create secure access for your accountant. They can view your documents, update administrative records, file VAT returns and alert you to any anomalies.
That's another time-saver for you and your accountant. Such a tool can also save you money if they bill you by the hour…
4. Avoid technical issues
When you use Excel, you save quotes and invoices on your computer's hard drive. This can cause several problems! An invoice might be saved in the wrong folder. You may waste time looking for it… or even forget it and face an unpaid invoice that endangers your cash flow.
Another risk: a breakdown! If a technical problem occurs on your computer or hard drive, you could say goodbye to issued or received invoices…
At least, a management tool such asAxonaut stores your documents in one secure place, including the cloud. You eliminate the risk of losing invoices.
5. Optimize decision-making
The more data your Excel invoice contains, the harder it is to work on. This tool can be slow to respond when the processing load is high.
Moreover, Excel tends to round large numbers, which leads to arithmetic inaccuracies. These small changes and inconsistencies often go unnoticed and are generally very difficult to trace. But at scale, this completely skews your data… and hampers your decision-making.
A high-performance management and invoicing software is precise. When you need to analyze data to improve your business, financial, or marketing strategies, it is far more reliable.
6. Avoid penalties
According to the General Tax Code, all businesses must adopt software or a cash register system that records payments received. Excel does not meet the various features defined by law…
In the event of a tax audit, you face a €7,500 fine for non-compliance.
Conclusion
Have these 6 reasons convinced you to abandon Excel in favor of a professional management tool? You can adopt Axonaut. A genuine management software dedicated to microbusinesses, it offers simple, fast invoicing solutions, as well as a CRM to improve your sales strategy.
Sources:
(1) https://www.researchgate.net/publication/301847890_What_We_Don%E2%80%99t_Know_About_Spreadsheet_Errors_Today_The_Facts_Why_We_Don%E2%80%99t_Believe_Them_and_What_We_Need_to_Do - What We Don't Know About Spreadsheet Errors Today: The Facts, Why We Don't Believe Them, and What We Need to Do
(2) https://www.reuters.com/article/jpmorgan-var-idUSL1E8GBKS920120511 - Reuters article about JPMorgan and VAR (value at risk)
