Are you tired of struggling with billing software?
If you’ve ever owned a small business, you’ve probably struggled to get paid on time, chase invoices, and juggle other billing details.
According to QuickBooks’ 2025 Small Business Late Payments Report, every U.S. small business with late invoices is owed more than $17,200 on average.
The good news?
Invoicing software is designed to make the majority of those problems a thing of the past for small businesses everywhere.
What you’ll find in this article:
- What Is an Invoicing Software?
- Why Every Small Business Needs an Invoicing Program
- Invoicing Program Features You Need
- How to Choose the Right Billing Software
What Is an Invoicing Software?
An invoicing software program is a digital application designed to simplify the processes of creating, sending, and managing invoices.
Rather than manually filling out an invoice in Word or Excel, invoicing programs offer automated processes for everything from making professional invoices to sending follow-up reminders.
A good software program should seamlessly integrate with your accounting software to streamline financial management as much as possible.
Small business owners are already juggling dozens of roles. The last thing you need is to spend hours upon hours each week just managing invoices by hand.
That’s where an excellent invoicing program can play a critical role in streamlining your operations and keeping the cash flowing.
What’s even better?
These invoicing tools are often very affordable and simple to set up.
Why Every Small Business Needs an Invoicing Program
Late payments are the death of most small businesses. They can stop your cash flow in its tracks even if you are making a profit.
The problem?
Late payments are completely killing small businesses these days. In fact, recent statistics show that 87% of businesses experience payments after the due date.
35% of these invoices are more than 30 days late.
Issuing invoices by hand only makes the situation much worse.
Paper invoices get lost. Terms get forgotten. Following up becomes a full-time job nobody ever signed up for.
Invoicing software automatically streamlines the entire process for small businesses.
Automated billing software has several key benefits:
- Invoices are automatically sent as soon as work is complete
- Automatic payment reminders save time and hassle
- Instant payment tracking
- Professional templates make you look established
- Integration with accounting software to eliminate double data entry
Invoicing software is the fastest-growing vertical of accounting software these days. The global billing and invoicing software market size was valued at USD 4.83 billion in 2024 and is expected to grow at a compound annual growth rate of 12.51% through 2033.
The data clearly indicates one thing: Business owners are finally starting to realize that manual invoicing costs too much time and money.
Invoicing Program Features You Need
While most invoicing programs offer similar core functionality, there are specific features that can make or break the software.
There are a handful of features that can separate useful programs from useless ones.
Automated Invoice Generation
A good invoicing program must make it possible to generate invoices in minutes. Invoicing features should make it possible to create professional invoices with just a few clicks.
It’s even better if templates are completely customizable to meet your specific branding.
Ideally, all of the tools that auto-populate information based on your settings (client information, calculate totals, taxes, etc).
Payment Reminders
Paying late is manually intensive on its own. Payment reminders are annoying, and chasing late invoices can become a time sink.
Automatic reminders are worth their weight in gold to business owners looking to reduce the amount of manual invoicing.
Payment reminders on your invoicing software will dramatically reduce late payments by sending gentle nudges from the system rather than the business owner.
Multiple Payment Methods
Customers want to pay on their terms. In order to get paid, small businesses need to meet them where they are.
Offer credit cards, bank transfers, and digital wallets for clients to pay you back.
Allowing clients to pay the way that’s easiest for them will make it far more likely they do it quickly.
Recurring Invoices
Are you dealing with subscriptions or other fixed billing? Automatic invoicing features take the work out of billing the same clients over and over.
Setup once, get paid automatically every cycle.
Expense Tracking
Expenses help you understand your profit margins. The right invoicing tools can help track those expenses and provide valuable insight into your business’s financial picture.
Reporting and Analytics
Insights matter. A good invoicing software program will offer reporting and analytics for payment trends, overdue amounts, and client payment histories.
These insights will help you make more informed decisions as a business owner.
Cloud Access
Cloud-based invoicing software is the way to go. Access invoices from anywhere on any device.
Small business owners can easily send invoices from their phone, check the status of their bills while traveling, and much more.
How to Choose the Right Solution
When the market has this many options available, it can become challenging to pick the right invoicing program.
Here are some simple suggestions that have worked well for us over the years.
Begin by assessing your needs. First of all, you need to identify your requirements: How many invoices do you send per month? Do you need a solution that can manage recurring billing, and what payment methods do most of your clients use?
Answer these questions to find the invoicing program that checks all of the necessary boxes for your business.
Set a budget. There are plenty of free invoicing programs for small businesses just starting. Depending on how much billing your company handles, you will probably need to upgrade to a paid plan as your business grows.
Budgetary limitations should only become a factor once your needs are established.
Trial before purchase. If a software program does not have a free trial, it’s probably not worth purchasing. Most modern software developers know that allowing customers to try their product before buying is the best way to get them on board.
Take advantage of these free trials and ensure that the user interface (UI) is intuitive and the software matches your ideal workflow.
Integration with other systems. If you are already using an accounting program or third-party payment processors, be sure to choose a program that connects to your existing services seamlessly.
Integration is a vital component of most business operations to help you avoid doing the same work twice.
It also prevents the majority of data errors between systems.
Look at reviews from similar companies. Tools that work well for freelancers or consultants may not suit small businesses. Check out reviews to identify programs with the features that most appeal to similar businesses in your industry.
What Makes a Great Invoicing Program Stand Out
After meeting the basic requirements for invoicing software, what makes great programs separate themselves from the rest of the pack?
A user-friendly design. The less intuitive the interface, the less likely your team will be to use it.
The best invoicing programs are almost instinctive once you start using them.
Reliable customer support. You will eventually run into an issue, whether with the UI or another feature. When this happens, it is critical to ensure that you can get the answers you need quickly.
Look for customer service available during your business hours and through communication channels you prefer.
Security features. You are protecting sensitive financial information when using an invoicing program. Encryption, secure payment processing, and frequent security updates are essential.
Scalability. Many small businesses grow into large businesses. Starting small is not an issue, but you need to be sure that the program you choose is not going to force you to switch platforms in a year or two when your business expands.
Wrapping Up
The right invoicing program can transform how small businesses manage billing and payments.
Say goodbye to chasing late invoices and drowning in paperwork. Instead, focus on growing your business and delighting your customers.
Let’s be honest:
- Invoicing by hand is a time suck.
- Sending automatic payment reminders will dramatically improve late payments.
- Invoicing software with cloud access will keep things convenient and flexible.
- Integration with other business software prevents duplicate entry and data errors.
- The features you need will vary based on your unique needs.
The tools are affordable. The benefits are real. And starting is easier than most people realize.
