Money Matters: On Invoicing

I didn’t have to write my first invoice until 2005, when I was asked to do additional freelance work for promotional videos for a TV series production I was on at the time.  Of course, since I’d never written one before, I had no idea how.  My producer at the time was able to give me some tips, but most has come from practice over time.  Money’s not something often spoken about at university, but it’s an important topic that should be covered.  This first post will be on “invoicing”, and in a few weeks, I’ll add another on “getting paid”.

There are many wonderful programs to use for invoicing.  I present a low-tech route here, because not everyone has access to or owns a program like QuickBooks.  Regardless of what method you use for invoicing, the basic information needed is the same.  You can create a folder called Invoices on your hard drive, with folders for every year.  Invoices can be stored here, labeled by company name and number.  Here is a basic template.

1/9/2012

Invoice to:

Company Name
Company Address

From:

Your Name or Company Name
Your Address
Your Phone Number

Invoice #010912

Services: Animation
Project:  X
X installment of X
Total due: $X

Please make check payable to X and mail payment to the address above.

Total payment due within X days.
Please include the invoice number on your check.

Things to include on an invoice:

1. The date.
2. Invoice To: List the name of the company or person you are billing, and their address.
3. From: List your name, company if applicable, address and phone number.
4. Invoice #: I give all my invoices a unique number.  The simplest method is to use that day’s date.  If writing multiple invoices on the same day, add a dash, followed by a number.  For example, invoice #011512, or #011512-1, respectively.
5. Services: List the services you have provided on the project, whether animation, storyboards, character design, etc.
6. Project: Name of project.
7. Breakdown of Charges: What I put here depends on how the project is billed.  If hourly, I list the hours worked, followed by the hourly rate.  For certain clients, a chart with a breakdown of the days worked and hours involved is helpful.  If the project is based on installments, you can list the number of that installment (whether first, second, or third), followed by total number of installments.
8. Total: this is the total amount due for the invoice.
9. Payment method: Since I usually get paid by check, I specify whom the check should be made out to and where it should be mailed, in this section.
10. 10. Due Date:  This varies by the project and the client.  In general, you can ask that payment be made in 30 days.  With projects that are based on installments, you will find it helpful to ask that the first installment be due upon receipt of invoice.  To ensure good records, specify that the invoice number be included on the check.

Helpful tips:

1. I cannot stress enough the importance of contracts.  I will cover contracts in another blog post, but having everything in writing is integral to any project.  There are clients I work with on a regular basis, whom I forgo a contract with, but this is a personal judgment call only you can make.
2. Your contract should detail payment schedule and methods.
3. Avoid starting work without an initial deposit.  In general, this deposit can be 30% – 50% of the entire fee, with the rest payable in installments.  How many installments are based on the project, and its length.  Red flags: Clients who refuse to pay this initial deposit, and clients who promise payment once their pilot gets picked up, or who promise loads of future work based on “exposure”.  Remember, you are a professional and this is business.  Your work has value and should be treated as such.
4. Make payments easy for your clients.  Spread payments over time and offer alternate methods.  Paypal can make payment by credit card an easy option.  There is a fee of about 3% involved, but you can always offer a discount to the client who pays by check.

Feel free to add your own tips here or ask me questions.  This post is intended as an overview, and everyone is going to have his or her thoughts or experiences on invoicing.  I hope it’s been at least informative and helpful – I know I could have used these tips a few short years ago!

The Freelance Corner features articles specifically related to freelancing and the challenges it entails.  The business side of animation is a topic not often discussed.  These articles are intended to foster feedback and conversation amongst all freelancers, so that we may all help one another navigate this growing trend.  If you have a topic you’d like us to cover, or an article you’d like to write, please contact us.