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As a small business owner, invoicing is one of the most important parts of your business, albeit the most time-intensive and frustrating parts of your workday. But the sooner your invoices go out, the faster you get paid. That makes it imperative that small business owners and entrepreneurs figure out a way to generate, send and track invoices that takes the stress and hassle out of the process. This is where Square Invoices comes in handy by helping to take the grind out of invoicing.
Square Invoices lets small business owners create customer invoices effortlessly, all from within the program’s easy-to-use online portal. Best of all, your clients can pay a Square invoice through a variety of methods, which removes barriers that could make it take longer for your money to make it to accounts receivable.
Of course, you’re going to want to read a Square Invoices review or two before diving into a new platform to handle your invoices. It’s best to make sure you’re aware of whether or not a Square invoice fee comes along with the free platform and to let your clients know how to pay a Square invoice from your business. We’ll dive into the specifics of the Square Invoices platform, as well as how onboarding a Square invoice system for your business might be the right move for you.
What is Square Invoices?
Square Invoices is a platform that helps businesses get invoices paid. Square, the company behind Square Invoices, has already built a reputation as a versatile point of sale option for credit card processing. Their platform now does much more than help people pay with a credit card—including inventory management, customer relationship management and sales analytics.
Square Invoices takes this a step further by helping small business owners invoice clients and vendors without having to manually create, track and account for each invoice they submit. The platform lets you send a Square invoice to a client as a one-time or recurring event. Plus, Square Invoices also allows you to store credit card information, which means that you can invoice your clients with the payment information on file (so long as they provide consent, of course).
Square Invoices does much more than help you get paid. You can track a Square invoice from creation to payment, as well as add attachments and receipts to your files. If you opt for Square Invoices Plus, your invoices are customizable as well, which means you can recreate an existing invoice template that works for you without having to start over with something brand new.
And with either version of the platform (Free or Plus), you can set automatic payment reminders, making it easier for you to provide a gentle nudge when clients haven’t sent their checks. And if paper checks aren’t your thing, Square Invoices lets you accept online payments as well.
Square Invoices pricing
You might be wondering what Square Invoices costs, given that the platform offers so much customizability and features to help take the pain out of collecting on your company’s payments. The good news, however, is that the basic version of Square Invoices is free to use. There are no setup or monthly fees, which means you can get started without making any kind of upfront investment. Sending invoices is free of charge as well, so you can send as many or as few as you need.
You will have to pay credit card processing fees, however. Usually, this fee ranges from 2.9% of a transaction’s total, or up to $0.30 per transaction. If you use Square as a POS, you’re already used to the company’s payment model: Square Invoices is similar to the per-transaction fee levied through the use of a Square reader or POS terminal. The same model helps power Square Invoices, which is what makes the platform free to use.
This could mean that you end up paying for your transactions if you run a retail business and you could also get dinged with fees when getting paid by vendors. You can, of course, ask your clients to pay a Square invoice outside of the platform, but doing so would negate the benefit of using this all-in-one solution.
If you decide to use Square Invoices Plus, you'll pay $20 for the platform as well as the payment processing fees. With this upgrade, however, you can save and reuse invoice templates, create custom fields, auto-convert estimates into invoices and more.
Pros of Square Invoices
There’s a ton to love about Square Invoices. Among the best things the platform provides is flexibility. Unless you’re in retail or move high volumes of product, odds are you’re not set up to get paid via credit card. Square Invoices makes it easy to get paid with a credit card, which opens up new opportunities for your clients to pay you faster. That your clients can pay bills online also takes away some of the lag time that comes with sending invoices manually. Having a one-stop-shop to collect and pay incoming invoices means you can get your money faster.
Square Invoices also makes it easy to stay organized. You can manage a Square invoice from creation all the way through to payment without having to keep track of invoices through a more manual method, such as a spreadsheet. All of your invoices are logged in the Square Invoices app, which means that your payments and overdue invoices are all kept in one central place.
Last but not least, Square Invoices provides users with a great tool for analyzing financials and creating financial forecasts. You can keep track of your company’s cash flow with on-demand reporting across the program’s mobile, desktop and tablet apps. This makes it easy for you to get a quick glimpse into how your company’s faring on short-term funds as well as monthly and quarterly revenue figures.
Cons of Square Invoices
Square Invoices has a ton of great features, but that doesn’t mean that it doesn’t have a few drawbacks as well. The major disadvantage is, of course, the cost. As great as it is not to have a monthly fee to use the Square Invoices platform, giving up a percentage of each invoice can eat into revenue over time. This might create a challenging trade-off for some entrepreneurs: making invoicing easier, but getting less money per invoice. You’ll pay a price for convenience, but it’s up to you whether or not it’s worth it.
Even though Square invoice fees can add up, there is an option that helps make the platform more affordable for high-volume businesses. Square Invoices offers custom pricing options for companies that process $250,000 or more in credit card sales. This may help make the platform more affordable for your business if credit cards are a major payment option with clients.
Another potential drawback for businesses looking to use Square Invoices is its high minimum for withdrawals. You’ll have to get to $1,000 in your Square balance before being able to sweep it into your business checking account. That might mean that you can’t access smaller amounts of cash in emergencies, such as a cash flow problem, even though you have money coming in.
Alternatives to Square Invoices
Square has a huge reputation within the world of processing cash, but that doesn’t mean it’s the only game in town. In fact, the alternatives to Square Invoices offer similar features and competitive pricing, which means you may want to do your homework before signing up with Square Invoices over another provider. Here are a few of the better Square Invoices alternatives out there.
Zoho is another well-regarded company that offers a suite of services aimed at making small business owners’ lives easier. Zoho Invoice is no exception, as it allows users to make and send off invoices, process client and vendor payments, as well as track expenses and unbilled hours.
The platform is easy to set up and user-friendly. Plus, it comes with a slew of helpful features, such as billing, estimates and reporting options that are similar to what Square Invoices provides. Zoho Invoice also gets high marks for its intuitive and stress-free tax management, making it easy to track taxable versus non-taxable transactions.
Lastly, and perhaps most importantly, Zoho Invoice is completely free. Zoho doesn't charge a monthly fee for their invoice service and doesn't require a credit card for you to sign up.
PayPal Business is a great tool for small business owners who are interested in an alternative to Square Invoices and already conduct some of their business within the PayPal ecosystem. Much like Square Invoices, PayPal Business also offers recurring billing, invoice customization and invoice tracking. The platform also provides advanced fraud protection and multi-currency transactions for international orders and bills.
PayPal Business charges fees per transaction, much like Square Invoices. The fee structure is also comparable, with charges ranging from 2.9% of an invoice total or $0.30 per payment. If you’re looking for a simple solution to help international clients pay their invoices, however, the fee structure may be worth it for the convenience of accepting multiple currencies.
Bill.com is another heavy-hitter in the world of online invoicing and billing. This platform makes it simple for vendors to pay bills and for clients to request payment from companies at the same time. Similar to Square Invoices, PayPal Business and Zoho Invoice, Bill.com also offers recurring invoicing options, invoice tracking, automatic payment reminders and more. Better still, Bill.com charges a flat rate for ACH payments as well, which provides more consistent fees for small businesses that want to track how much they’ll have to pay when invoices come in.
Out of the invoicing platforms we’ve reviewed, Bill.com is by far the most expensive alternative to Square Invoices. The service comes in four varieties: essentials, team, corporate and enterprise. Bill.com Essentials costs $29 per user, per month and offers fewer integrations than more expensive plans (and does not integrate into QuickBooks Online, for example). More expansive levels cost as much as $59 per month but provide more services.
The bottom line
Invoicing is far from any small business owner’s favorite activity, but there are a ton of great software platforms out there to help make it less painful. Whether you go with Square Invoice or one of their alternatives, you can make your invoicing process smoother and less time-intensive. Plus, some of the best programs are either free or inexpensive, making it easy to take the jump and give a new platform a try. Once you’ve picked the right invoicing software for you, you can spend less time on getting paid and more time propelling your business forward.
This article originally appeared on Fundera, a subsidiary of NerdWallet.