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Looking for Software for managing progress payments
Silverfox
Member Posts: 4
I have a client who needs to issue invoices on the basis of percentage complete. This is different than recurring invoices where the amount is fixed. In progress payments, such as for construction and consultants the fees vary on the basis of inputs vs total estimates. Absolutely perfect for a spreadsheet but a major headache for company cash flows. Any recommendations for an easily implementable progress payment system
Many thanks
Andy
The Silverfox
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@Silverfox Hi Andy! Thanks for taking the time to share with us. I'm interested in learning more about how we could solve this problem for you. I understand you're an accountant, is that correct? Are most of your clients in these fields, and do the majority of them require this model for payments?
One possible workaround would be to create an invoice with the different steps of a given project as individual line items, each with their own due date in the description. The merchant could accept partial payments for different steps of the project, as well as adjust the invoice as things came up. The invoice could be resent for every step, with adjustments to amounts and dates as required. The invoice would show previous payments and the total remaining balance.
We have some customers - consultants - who work on projects that change over time, and get around this by modifying invoices. If however, you need to get signatures, approvals, or send out estimates and keep a record of everything at every stage... I think this would be less than ideal?
Could you share some insight into what your clients are looking for? In terms of the real world application for this type of payments processing. When are they billing their clients, and when and how are they paying? What type of recordkeeping do you need?
Hi Charlotte
Sorry for the slow response, but month-end are busier than mid-month. Yes, I have one client who wants progress billing because he works on government contracts. The way progress billing works for him and installers/builders is that they charge for the parts that went in (for this they use inventory management) and separately for the time against the total estimate.
One easy workaround would be to determine the total value of the project and use 3 or 4 digits after the decimal point in quantity. So if they completed 3/8 of the project the unit price would be the entire bid and the quantity billed would be .375 or 3/8th.
Let me know if I can provide further input. This is a good client with growing volume and needing improved cash management. Thank you very much for taking the time and care to respond.
Many thanks
Andy
Silverfox, the other way to do it might be to add a suffix onto the invoice number INV's 308-A, 308-B, 308-C then use the 0.375 or whatever the proportional payment is on each line item.
Cheers,
Andre