How to automate invoicing in Xero: repeat, remind, reconcile

Xero can raise and email an invoice on a schedule, chase it on a schedule, take payment from a link on it, and match the money when it lands. For a business sending sixty invoices a month, half of them identical every month, that removes thirty invoices and most of Friday. Here is how to automate invoicing in Xero in the order that pays back fastest, what each step costs on a South African plan, and where the automation stops.

Before you start

• A Xero subscription on the South African site. On 15 September the Xero SA pricing page listed Starter at R450 a month, Standard at R795 and Premium at R1 095, all including VAT, with the first three months at R90, R159 and R219. Starter caps you at 20 invoices a month, so sixty invoices means Standard or above.
• Adviser or Standard user rights in the organisation, so you can edit templates and reminders.
• Your customers' email addresses in their Xero contact records. A repeating invoice with no email address just sits there, approved and unsent.

Step 1: find the invoices that are the same every month

Open Business, then Invoices, and filter the last three months. Anything with the same customer, the same lines and the same amount three times is a candidate. Retainers, rentals, service contracts, monthly support. Write the list down. For a sixty-a-month business it is usually twenty to thirty.

Step 2: build one repeating invoice template

In Invoices, choose the Repeating tab and click New Repeating Invoice. Xero's own instructions on adding a repeating invoice template say every field is mandatory except End Date and Reference. Set the frequency, the first invoice date and the due date. Then choose what happens on the day: save as draft, approve, or approve for sending. Start with approve, without the sending, for one cycle.

Step 3: watch the first cycle, then turn on the email

On the first invoice date, check the invoice Xero raised. If the lines and the VAT are right, edit the template to approve for sending. From the second month, that customer's invoice goes out without anyone touching it. Repeat for the rest of the list.

Step 4: turn on invoice reminders

In Sales, then Invoices, click Invoice Reminders: Off. Xero ships three default reminders and allows up to five. Tick the box to email customers, and set the days. Xero's guide to setting up invoice reminders lets you set each one a number of days before or after the due date. A useful South African schedule is three days before, on the day, and seven days after.

Step 5: write the reminders in your voice

Edit the default text. Say the invoice number, the amount, and how to pay. Do not threaten in the first reminder. The seven-day reminder can mention the terms on the invoice.

Step 6: add the payment link

Under Payment Services, connect a card or instant EFT provider available in South Africa and add it to your invoice branding theme. The customer gets a Pay now button on the emailed invoice. Xero's pricing page lists online payments on every plan; the provider charges its own percentage per transaction.

Step 7: connect the bank feed and reconcile daily

Under Accounting, then Bank Accounts, add your bank feed. When a customer pays, the transaction appears in the feed and Xero suggests the matching invoice. Reconcile every morning. The loop is closed only when the money matches the invoice and the reminder stops.

Step 8: exclude the customers who will complain

Some customers pay on statement, on the 25th, every month, and a reminder on day three offends them. Open their contact record and turn reminders off for that contact. Do this before the first reminder goes out, not after the phone call.

What breaks when you automate invoicing in Xero here

The public holiday. Reminders go out on the schedule, and Xero has no setting to skip a weekend or a holiday, or to pick the hour they are sent. A reminder that lands on the Day of Reconciliation, to a customer whose accounts office is closed, reads as automated in the worst way. Check the reminder dates against the public holiday calendar each December and adjust the days before you leave.

The cash deposit. A customer who pays by cash deposit at a branch produces a feed line with a bank reference and no invoice number. Xero cannot match it. Someone has to, and that someone needs the customer to have told them. Ask cash-paying customers to use the invoice number as the reference, and expect half of them to.

The feed that lags. South African bank feeds arrive once a day, sometimes later. A customer who paid this morning gets a reminder this afternoon. Set the after-due reminder to seven days, not one, for this reason.

VAT on the template. A repeating invoice carries the VAT treatment you set when you built it. If a line changes from standard-rated to zero-rated, or the customer moves offshore, the template does not know. Review templates quarterly.

When this stops being enough

Xero automates the invoices that are the same every month. The other thirty are different every time, because they come from a job: a repair, a delivery, a callout with parts and hours on it. Xero has no job card, so those invoices are typed from a job it never saw, by someone reading a WhatsApp photo of a paper sheet. Every retyping is a chance for the hours to be wrong or the part to be missed.

That is the seam, and it is the one Zorah closes. The job record feeds the invoice directly, so the operations system your technicians already fill in becomes the source of the Xero invoice, with the hours and the parts already on it. We do not replace Xero. The operations side holds the job, the back office holds the invoice, and the two agree.

On Monday, open last month's invoices and mark each one as either "same as last month" or "came from a job". The first column is what Xero can do alone by the end of the week. The second is the size of the retyping.