You work in stages, and now Houzz Pro all-in-one software lets you easily bill in stages too. This means you can more quickly recover cash you’ve laid out for materials, supplies and labor instead of waiting until the project is completely finished. While the software already lets you convert estimates to invoices with a click, the new Progressive Invoicing feature lets you invoice based on a percentage of the total cost, as well as when you hit a milestone or complete a task. You can also customize the invoiced amount. This new feature offers you and your clients a number of benefits.
Better Cash Flow Management
Having all your cash reserves tied up in a project with the pay date in the distant and possibly uncertain future isn’t just nerve-racking; it means you might not be able to take on other projects that require a financial outlay. Or you might need to take out a business loan to cover that outlay, which will incur added costs in the form of interest paid to the lender. With Progressive Invoicing, you can bill the client when the team hits a milestone, such as finalizing all the design plans, or when they’ve completed a specific task, such as laying the foundation. Combine this with the ability to get paid quickly online, and you’ll be able to manage the cash flow for your entire business much more effectively.
Reduced Financial Risk
Expecting the unexpected is par for the course on any design or construction project. But what happens if the unexpected element turns out to be that the project gets seriously delayed or canceled entirely? Progressive Invoicing helps mitigate this risk because you get paid in stages, meaning you’ll already have been paid for the work completed.
Tip: Also be sure that your contract with the client includes provisions for delays and cancellations. Check out our free contract templates and guides for interior designers and construction pros to learn more.
More Transparency
Clients greatly appreciate transparency, especially when it comes to billing and work completed. And Progressive Invoicing lets you be more transparent about both of these components without adding time-consuming gruntwork. You can select either specific project tasks or major milestones to be listed on the invoice, and you’ll choose the exact percentage of the project’s total cost to bill, which will be calculated automatically—no need to manually pull out the calculator and possibly end up with errors. Whatever percentage you type in, you’ll see the equivalent in dollars and cents right next to it.
Bonus: Every time you create an invoice, you’ll see the outstanding balance right below the total dollar amount of the project estimate.
Better Client Relationships
When you invoice in stages, you demonstrate to the client that you’re hitting your milestones and completing other project tasks as promised. This builds trust with the client and any other stakeholders, and can lead to those all-important positive reviews and referrals. Breaking up payments by percentage also means clients won’t get hit with a single large bill at the end, so it improves client relationships because it’s a kinder, gentler way of billing.
Increased Motivation
When a payday won’t come until far off in the future, it can be hard to stay on task in the present. But if you and your team know you’ll get paid immediately after reaching certain milestones or completing certain project tasks, it keeps everyone motivated to work efficiently. Financial incentives can be some of the strongest incentives!
Tip: Get money owed to you even faster by accepting online payments. No waiting for checks to clear or for clients to drop off funds in person.
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