Selling vehicles is a lucrative business venture for people who have a passion for automobiles. People who are looking to purchase a vehicle want to partner with someone who knows their way around automobiles. However, running a successful car-selling business also means that operational procedures, like billing, bill of sale, and sending invoices, are monthly obligations.
Along with covering your operational expenses, regular cash flow will allow you to invest in more cars that you can sell at a higher price later on. Overall, it can contribute to your business’s growth, which is the main goal at the end of the day.
That’s why you need to know how to create a car sales invoice. It’s the most critical document that will be the determining factor towards you getting paid or getting shammed. Fortunately, with the advancement of technology, creating an invoice for car payment can be done easily using an invoice software system.
How Important is an Invoice?
Before we delve deeper, we want to point out the reason why you need to take your invoicing seriously. For your car business – or any other business for that matter – an invoice serves an essential purpose for both income and accounting. Your invoice will demonstrate your client’s obligation to pay you for your goods or service. It offers verification of the payment agreement between your car business and your customer.
In other words, an invoice is an important document that will help you earn and take your business to the next level. Without it, any payment that you request from your customer will not be considered valid. That’s why if you want to make it official, you need to have a car sales invoice ready whenever a transaction pulls through, and you’re about to make a sale.
How to Create a Car Sales Invoice?
- Open a word processing application on your computer (e.g., Microsoft Word). If you don’t have one, you can always access free word processing programs online (e.g., Google Docs).
- First, create the header of your car sales invoice. Type the word “INVOICE” at the very top of the page. Position it at the center. To make it more noticeable, bold your font and format it to an even bigger size. Below your header, place your company name along with your complete address right below it. Position these two lines on the left-hand side of the page.
- The next thing you want to add is an invoice reference number. You can place it in the header part after the address or to the right of it. The invoice reference number will help you keep your invoicing system organized and allows you to quickly find a particular invoice in case of any concerns in a specific transaction.
- The next thing you need to place in your invoice is two dates: one for the invoice date and the due date. The former indicates the date on which the bill of sale invoice was created, while the latter is the date by which your customer should settle the payment.
- Place a description of the car at the center of the page. Details that you should mention in this section include the following: Make, Model, Year, Color.
- You can add other details regarding the vehicle sale. For example, you can include the terms of the sale and the full value of the automobile.
- Write the total amount at the bottom of the sales invoice. You can reiterate the date that the payment is due for emphasis. It can either be next or below the monthly payment amount. You can also include important statements at the bottom of the page, like your terms for late payments (fees, penalties, etc.). Remember that every piece of information you indicate in your invoice will contribute towards a successful car sale.
However, if you don’t have time to create your invoices manually, you can always create your own car sales invoice template available online. ReliaBills, for instance, offers a variety of invoice templates that you can use to make invoicing easier for you.
What to Look for in a Vehicle Sales Invoice?
A car sales invoice will always have two prices. The first is the ‘Standard Vehicle Price,’ which is the cheapest that a car will sell for. The second is ‘Vehicle Price with Optional Equipment,’ which costs more since it includes add-on features like GPS, heated leather seats, wi-fi connectivity, and more. Apart from these two prices, here are other things that you’ll need to look for in all of your vehicle invoices:
List Price
Also referred to as the manufacturer’s suggested retail price (MSRP), this price is usually considered a negotiable value. The list price is the recommended value that the manufacturer tells the car dealership to price the vehicle. In most cases, car dealerships pay less than what’s seen on the sticker. Because of this, car buyers shouldn’t pay more than what the list price indicates.
Documentation Fee
This price is a fee that the seller charges for creating the paperwork and prepping the car for its final customization and delivery if you’re wondering what the maximum amount that your location allows for the charging fee, you can check with your state.
State Taxes
The state tax is a portion of the list price. Some states don’t have a vehicle state tax (for instance, Florida). However, in most states, they charge a state tax every time someone makes a purchase.
Registration Fee
This type of price should only be listed if the seller plans on registering the car for the buyer. If not, then you can disregard this payment fee. You can indicate this when using a car sales invoice template. You can also inform the buyer about it before continuing with the transaction.
Vehicle Information
It’s always crucial that you check for the basic details of the car you’re about to sell. Make sure that it’s accurate and matches the exact information of the vehicle. For instance, the vehicle identification number should be accurate with the one you have in your system. Keep in mind that it’s easy to get carried away in the amounts while calculating the final price. That’s why you should always keep that in mind. Make sure you add all the elements that will factor into the final price of the vehicle. Include taxes, the monthly amount that your customer needs to settle if they choose installment, and more.
Car Invoice Price
Car invoice prices are used exclusively by dealerships. It’s a type of invoice that’s used when a manufacturer sells a car to a dealership. Keep in mind that it’s different from an invoice used when selling a vehicle to a common customer. This document will include the dealer incentives, holdback, and the price of rebates.
Make Your Invoices Better with Recurring Billing
Selling cars isn’t an easy job. It requires a lot of dedication, patience, and perseverance. Once you land a deal, the last thing you want is to skimp on your invoicing. Not only will you potentially lose a client, but you will earn at a slower pace. Why go through all the hardship when you can automate your invoicing process and make it ten times quicker and more efficient?
Now that you know how to create a car sales invoice, the next thing you need to do is switch to recurring billing and automate the entire payment process. Most people who know recurring billing believe that it’s only made for subscription-based businesses. But while that may be true, you should also know that recurring billing nowadays can be used by any business that offers recurring services.
Introducing Recurring Billing
Haven’t heard about recurring billing? No problem! We’ve got you covered. To start, recurring billing is a type of billing that allows customers to pay for a service or product on an ongoing basis. For example, if you subscribe to Spotify Premium for $11.99 per month, your subscription is considered a recurring payment method.
Recurring payments are becoming more popular with the evolution of digital products and services because they provide both businesses and their customers with several advantages.
The Benefits of Recurring Payments for Businesses
For businesses, recurring payments provide a steadier cash flow while reducing administrative costs associated with delayed payment or billing errors. Here are other three benefits to consider:
- Less overhead costs: Since subscription services receive their money every month, there is no need to pay a third party to collect the payments.
- No need for delayed invoices: With recurring billing, customers’ bills are paid automatically every month – no late fees! In addition, there is less risk of a customer forgetting about an invoice that needs to be addressed and making mistakes along the way.
- Less errors: More minor payment errors mean lower overhead costs for businesses.
The Benefits of Recurring Payments for Customers
For customers, recurring payments provide simplicity and ease of use. There’s no need to open every invoice or keep track of payment deadlines; instead, they are paid automatically on time every month with no late fees! In addition, there is less risk involved because the automated invoicing process reduces the risk of human error.
Here are three more benefits to consider:
- Convenience and simplicity: With recurring billing, customers’ bills are paid automatically every month – no late fees! In addition, there is less risk involved because the automated invoicing process reduces the risk of human error.
- No need for reminders: Customers don’t have to open or act on their invoices every billing cycle because they are paid automatically.
- Reduced risk of human error: With automated recurring payments, there is less chance for mistakes since customers’ bills are auto-generated and sent out monthly without the need for manual input from businesses or customers themselves.
Automate Your Invoices with ReliaBills
Make business operations easier and more manageable by using ReliaBills and its recurring billing feature. ReliaBills is a cloud-based invoicing and recurring billing platform designed to help businesses automate their payment processes. It provides subscription management, automated invoice generation, payment processing features, and more – all of which are vital for the success of any business that uses recurring payments as part of its revenue model.
If you’re ready, you can skip that part and jump straight to creating your free ReliaBills account.
Keep in mind that the recurring billing feature isn’t available in our basic plan. To get additional features, including recurring billing, you will need to upgrade your account to ReliaBills PLUS for only $24.95 per month.
Wrapping Up
Creating and using a car sales invoice is crucial to your business operations. It will enable any dealer to earn and get paid on time and expand their car-selling business. Every car sale that you successfully close will contribute to the overall success and progression of your business. However, for you to make it an official sale, you’ll need to have an invoice. That way, the sale will be included in your system as a done deal. You can create your invoice today by creating an account with ReliaBills today.
