Missing a payment—or duplicating one—can be a costly and time-consuming mistake. Without a way to manage an organization’s increasing flow of invoices, errors like these lead to unnecessary fees and wasted time that eat into company revenue. A strong invoice management system opens the door to potential savings, improved supplier response, and faster service. 

To realize these benefits, small business owners may think they need a complicated invoice tracking system. While the right software will definitely help you save as you grow, a simple accounting system, like an Excel-based invoice tracking spreadsheet, might be just the thing to organize payments and keep on top of upcoming deadlines. 

Our free Invoice Tracker Template will help you quickly and easily keep track of invoices to prevent expensive mistakes. It even has extra features that clarify financial patterns and help track spending throughout the year.

How to use Order.co’s free invoice tracker

1. Download the invoice tracker template or get the Google Sheets version here.
2. Enter data into each field of the invoice tracking template, including:

• Due date
• Customer name
• Invoice number
• Invoice date
• Total amount due
• Paid-to-date amount
• Remaining amount
• Payment date
• Category

3. Save a copy locally and share it with relevant stakeholders.

How to make the most of the invoice tracker: 

The invoice tracker template provides a simple way to view all invoices currently in process. It also provides two views of the raw data to show invoice totals over time and spending by category. Here’s how to enter and view data:

Invoice overview tab

1. Enter each invoice into a row of the tracker, adding as much detail as possible. The invoice date, total and remaining amounts, and category are tied to the pivot charts in the monthly invoice totals and spend totals by category tabs, so these are required fields for accurate calculations.
2. Use the drop-downs in the column headers to sort or filter information.
3. To add rows, right-click the row indicator to the left of the last blank row, select ‘Insert rows,’ and choose ‘Insert above.’ 

Spend totals by category and monthly invoice totals tabs

The spend totals by category and monthly invoice totals tabs use pivot charts to break down primary spreadsheet information and display totals by respective category. After entering new invoices in the overview tab, update the chart information by selecting ‘Data’ from the ribbon and clicking ‘Refresh all.’ This will populate the new invoice data into the charts.

Tool

Invoice Tracking Template

Download the invoice tracking template to avoid costly mistakes, clarify financial patterns, and track spending throughout the year.

Download the tool

What is an invoice? 

An invoice is a document issued by a seller to a buyer detailing products or services provided, their costs, and payment terms for the transaction. Sending these documents out is called “invoicing.” 

Invoices are formal requests for payment. They’re a legal instrument that helps track sales, enforce terms, and manage accounts receivable, making them a crucial aspect of business accounting and financial management.

What is an invoice tracker?

Organization is key to maintaining accounts in good standing with vendors and service providers. A business invoice tracker is a spreadsheet or platform that gives the finance team a central location to log invoices, track payment statuses, and analyze trends in spending over time or across categories. 

A few things to know about tracking invoices:

• Invoice trackers don’t need to be complex to be effective. All you need is the pertinent information for each invoice and a way to mark them as paid, unpaid, or partially paid. 
• Businesses that pay invoices across multiple locations often need strong invoice tracking to avoid potential duplicates or missed payments. This requires a central place for reporting invoices generated individually.
• Invoice tracking is important for early-stage companies where cash liquidity may work on a tighter margin, but even mature organizations benefit from a strong invoice management practice as a way to track costs and reduce errors, duplications, and fees.

Why is well-managed invoicing important?

Well-managed invoicing is crucial for maintaining cash flow and transparency in transactions. For sellers, it ensures timely payments and accurate financial records. Buyers benefit from clear, detailed invoices that facilitate budget management and dispute resolution. Effective invoice management fosters trust, efficiency, and financial stability between trading partners.

Sellers recognize several key benefits as the result of well-managed invoicing, such as:  

• Improved cash flow: By ensuring invoices are processed and paid on time, sellers can maintain a steady cash flow, which is crucial for day-to-day operations and growth investments.
• Reduced administrative costs: Efficient invoice management practices minimize the need for manual entry and follow-up, reducing administrative overhead and costs associated with invoice processing errors.
• Enhanced customer relationships: Transparent and accurate invoicing fosters trust between sellers and buyers, improving customer satisfaction and loyalty.
• Increased financial accuracy: Accurate invoicing helps maintain precise financial records, which are essential for budgeting, forecasting, and tax reporting.
• Better compliance: Adhering to standardized invoicing practices ensures compliance with regulatory requirements, reducing the risk of penalties or legal issues.

Buyers also enjoy benefits from well-designed invoice management, including: 

• Streamlined payment processes: Buyers benefit from clear, concise invoicing that simplifies the payment process, reducing the time and effort required to settle accounts.
• Early payment discounts: Some sellers offer discounts for early payment, which well-organized buyers can more readily take advantage of thanks to efficient invoice management.
• Improved budget management: Accurate and timely invoicing helps buyers forecast and budget by providing a clear view of upcoming expenses.
• Enhanced dispute resolution: When both parties use effective invoice management practices, it's easier to resolve disputes or discrepancies in billing, saving time and preserving business relationships.
• Greater financial control: Buyers maintain better control over their cash flow and financial planning when they employ consistent, predictable invoicing.
• Easier access to detailed spending records: Well-managed invoicing systems allow buyers to track spending accurately, aiding in cost analysis and financial oversight.

What are the benefits of an invoice tracker?

Tracking invoices and ensuring their timely payment is about more than avoiding fees. It improves many areas of operations internally while strengthening your financial position.

Lower costs: Businesses that closely monitor their bills reduce invoice-related costs like fines and interest payments. They also save money on wages since AP clerks spend less time hunting down and correcting payment issues. Early payments open up the potential for discounts with certain vendors.

Better supplier relationships: Like any business, vendors rely on timely payments. Tracking and handling invoices helps build a better partnership between your business and its suppliers. It also helps contextualize your spend with each supplier, which may create avenues to negotiate better prices and more flexible terms.

Increased visibility: Tracking invoices and keeping tabs on category spend brings a business’s full financial picture into focus. Capturing every invoice and its details in one place creates better visibility into spending, identifies areas for improvement, and aids in making allocation decisions during budgeting season.

The Order.co invoice tracker can help users get started on the path to better invoice management by centralizing data on upcoming invoices and payments, detailing the necessary information to pay invoices on time, and providing a foundation for basic spend tracking.

Is a spreadsheet-based invoice tracker enough?

Spreadsheets are a great tool for organizing, analyzing, and sharing information, and spreadsheet-based invoice trackers can help manage a small flow of supplier invoices each month. However, as businesses grow, technology becomes beneficial because it’s more cost-efficient than manual tracking. 

To identify when it's time to make the switch to software, watch for these common challenges and friction points: 

1. Invoice processing is falling behind

As businesses grow, the flow of invoices and payments increases, sometimes exponentially. Unless your company adds headcount to keep up with processing, the potential for missed or delayed payments will rise. Technology automates many repetitive AP processes that bog down even the most high-performing teams. If processing speed becomes a blocking issue, it may be time to upgrade. 

2. Your company has multiple locations or offices

Procurement often becomes decentralized during growth, and managing AP processes across multiple locations can wreak havoc on invoice payment timelines. These issues can lead to contractual agreements that rob a business of buying power, duplicate invoices or payments across locations, and difficulty managing the logistics of receiving and paying for goods and services. A spend management platform centralizes these activities across locations so your business can take advantage of the benefits of growth. 

3. You need to integrate the tech stack

AP and procurement teams produce a lot of data, and sharing that data across platforms unlocks the potential of the finance department to negotiate effectively and secure better outcomes. A procurement platform with spend management tools breaks down data silos between departments and locations. It ensures everyone can access the best data to buy what they need and track spending. 

How Order.co makes invoicing simpler

A procurement platform automates cumbersome invoicing tasks by streamlining purchase orders, approvals, and payments in one unified system. Automation reduces manual data entry, minimizes errors, and speeds up processing times, making invoicing less costly and time-consuming. It transforms a traditionally complex process into a straightforward, efficient operation. The data you centralize with a procurement platform also enables better spending and budget decisions for better performance over time.

Order.co can help streamline invoice processing in your company with these integrated features: 

• Streamlined invoice management: Automating invoice processing reduces the manual effort involved in handling invoices, speeding up verification and approval processes while minimizing errors associated with manual data entry.
• Enhanced spend visibility: A centralized platform provides real-time insights into company spending. This increased visibility allows for better budgeting, forecasting, and spend analysis across all departments and projects.
• Improved supplier relationships: Automated payment processes ensure timely payments to suppliers, which helps maintain good relationships and opens up opportunities for early payment discounts.
• Reduced processing costs: Automation significantly lowers the cost per invoice by reducing the need for manual intervention, thus saving on labor and related expenses. It could mean the difference between paying $2 to process an invoice versus $9. 
• Improved cost avoidance: Managing procurement and AP automation with Order.co helps prevent incurring fees and penalties associated with delayed payments. 
• Enhanced scalability: As procurement volume grows, an automated platform can easily scale to handle increased invoice and transaction volume without a proportional increase in effort or headcount.

Is your organization ready to create a stronger invoicing management process? It may be time to consider a centralized processing and payables solution like Order.co. Request a demo to learn more.