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Do Sales Invoices Expire? Here’s What You Need To Know

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If you’d rather read the transcript it’s here below.

‘Is there an expiry date on an invoice?’

I saw a Facebook post in the Builders Talk Group the other day and this guy was asking this question.  He had found himself in a situation where he’d done some work for a customer – a repeating customer (in fact, a real estate agent managing rental properties), and he hadn’t sent them an invoice. 18 months later he sent them an invoice for the work he did 1.5 years ago.

Not surprisingly, they didn’t want to pay. And he was asking the question:

  • What was his legal position?
  • Where did he stand?
  • Was he legally entitled to demand his money?

And I think this isn’t my area. I’m not a lawyer, I’m a business coach but I think the advice was that you are right. There’s NO expiry date on an invoice, and they still had to pay, and he could take them to court and he would probably win.

Is it okay to raise an invoice late?

I don’t really think that’s the point of view because the damage is done. He hasn’t raised the invoice, that’s his own stupid fault, and if he goes back to his customers and say, “You need to pay now”, he’s going to ruin that relationship. It’s going to cause them significant problems by insisting on being paid. They’re not just going to go “I’m terribly sorry,” and pay him. That’s hardly going to come out of their profit.

His mistake is costing them money or they’re going to have to go back to their landlord and try and recover it. In this case, it’s the landlord.

They’re going to have to go and try and recover that money from someone else. However, it could turn out – and whether you work for a real estate agent, builders, or consumers, trying to recover money from an old job is going to cause them significant frustration and angst. So, you’re causing a problem for somebody else by this action.

Not only by this action but because you were too disorganised to do your job properly or your business is too disorganised to do its job properly.

Recommended Reading: If Your Customer Is Unhappy With Your Invoice – It’s Your Fault! (Sorry)

So, once you’re in this position, wanting payment for your mistake for the work you legitimately did, and legitimately have a right to be paid for, there’s going to be a cost to your customer over and above paying the invoice. You’re going to damage that relationship with your customer whether you’re morally justified in asking for this money.

My job as a business coach, of course, is to make you look at the bigger picture. Whether you’re right or wrong, you’re going to damage that relationship with your customer.

So, you need to look at the bigger picture and go:

“How much money am I going to get by standing firm and demanding to be paid and how much money am I going to lose by not getting future work from these people?”

“How much future business do I jeopardise by pursuing this which was my fault, anyway?”

And I think the real answer is it’s very likely that you’re going to jeopardise much more than you’re going to gain in the short term and it was your mistake.

You made it. Man up.

Raising an invoice is your business’ responsibility

I’m not going to go even further. This isn’t the real lesson at all, is it?

The real lesson is, what the f*ck you’re doing, not sending invoices for 18 months after you’ve done the work? That’s a f*cking criminal mind.

Your business gets paid for doing work, the people who work for you in your business and do work that your business gets paid for. Part of your business’ job is to raise the invoices and collect the money so that everybody can be paid. You’ve got a responsibility to do that as well.

Just swinging the hammer and doing the trade work is not enough. You have to build a business that has systems, procedures, and the checks and balances so this doesn’t happen.

If you’re too disorganised to do this, well, fair enough. We’re not all cut out to be good at everything in your business, but if you’re too disorganised to do that yourself, hire somebody else.

The world is full of organised, process-driven people who will do your admin for you, who will help you make sure that you set up the systems including the computer systems and the job management systems.

I’m not one of them either. I don’t like doing that stuff. I’ve got three people who work with me, who are much better at that stuff than I will ever be.

So, for goodness sake, don’t try and do it all yourself. Don’t muddle through costing yourself money by making expensive mistakes.

Give the money to me and I’ll help you hire somebody. I’ll help you have people set that up for you so you can go and focus your time on work that drives your business forward and makes you money, instead of on boring things that grind your soul.

Give the money to me, instead. I’m a business coach, I can help.

There are four ways you can engage with me:

  1. Subscribe to these emails and get them once a week in your inbox so you never miss a video from me.
  2. Join the Trades Business Toolshed Facebook Group where you can watch these videos, ask me questions or talk to your peers.
  3. Attend my next Tools Down workshop.
  4. Book yourself a 10-minute chat with me. We’ll talk about whether coaching is right for you now and if it is, we’ll go further into the process before you have to make your mind up.

See you later.



About the Author

Jon Dale

Jon likes helping business owners and especially owners of trades businesses. Life can be a bit frustrating when you run a business and a trade business can be even more so. Jon reckons this stuff is fixable and that you can fix it by making some fairly simple changes to the way you do things. In fact, he runs a free monthly webinar to help explain the process further of moving your business from manual to scalable.

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