Year-End Budgets of Commercial Clients

Budgets that close on December 31

Many companies' financial years end with the calendar year. Money left in a department's budget on December 31 usually disappears with it.

So in early December, office managers, facility managers and marketing coordinators look for something useful to buy, and they look quickly.

They need a price they can approve, paperwork their accounts department will accept, and an invoice dated this year. That department may stop processing invoices well before the 31st.

The supplier who makes all of that easy gets the order. The one who needs a site visit and a week to quote usually does not.

What the buyer needs from you

• A fixed price they can approve without a meeting.
• A quote on letterhead with your legal business name.
• Your GST number and payment terms on every document.
• An invoice that matches their purchase order exactly.
• A delivery date they can rely on.
• Someone who answers email in December.

The fourth causes the most trouble. An invoice that does not match the purchase order is sent back, and by the time it is corrected the year may have closed, taking the budget with it.

Packages instead of open quotes

A buyer with two weeks and a fixed sum wants to choose, not to start a conversation. A few defined packages with prices let them do that from the website.

Each package should spell out its contents, its timing and its price before tax. Three is a good number: small, medium and large.

Custom work still has its place, but a package can be approved in a day, and a custom quote in December often misses the deadline.

Quotes that survive approval

A quote typed into the body of an email often has to be redone before anyone can approve it. Send a document instead, on letterhead, as a PDF.

It should carry your legal business name exactly as it will appear on the invoice, your address and GST number, a quote number and date, and a valid-until date.

Itemise the prices with taxes shown separately, state the payment terms, and leave a line for the client's purchase order number. That one line saves a round of emails later.

Invoices that match purchase orders

A purchase order is the client's own record of what they agreed to buy, and their accounts department pays an invoice only when the two agree.

Copy the purchase order number onto the invoice, use the same descriptions and quantities, bill the company named on the order, and send it to the accounts address it gives.

If a job is delivered in parts, ask before invoicing in parts. Some systems accept it; others reject anything but one invoice for each order.

Being set up as a supplier

A first order from a larger company often means being added to its list of suppliers: a form, your legal details, sometimes banking information for direct deposit.

That can take longer than the work itself. Keep a one-page supplier sheet ready with your legal name, address, GST number, an accounts contact, and insurance details if your trade carries them.

Give banking details only when a client asks for them, and tell new clients you will never change them by email alone, since fraudsters pose as suppliers to redirect payments.

A worked example

An interior plant company with two technicians and a van looks after plants in offices, clinics and hotel lobbies across a city: watering, cleaning, replacing tired plants, and seasonal displays in December.

Every December, office managers phoned with the same question: there is money left in this year's budget, can reception have new planters before the end of the month?

Its website showed photographs and a contact form. Each request became a site visit and a quote typed into an email, which reached the client a week later.

Last year two quotes were approved too late to invoice before year-end. One invoice came back because it lacked the client's purchase order number, and by the time it was corrected that budget had closed.

In the spring the company wrote three packages, a reception desk set, a boardroom set and a large lobby planter, each priced with pots, plants and three months of care.

It made a quote template on its letterhead with its GST number, a valid-until date and a line for the purchase order number. This month, a request that names a package gets its quote the same day.

Prepaid work and honest dates

Some clients ask to be invoiced this year for work that happens next year. That can be done honestly, as long as the paperwork says exactly what was bought and when it will be delivered.

Date the invoice when it is issued, describe the work and its timing plainly, and keep a record of what has been prepaid so nothing is delivered twice or forgotten.

How the client accounts for it is their decision and their accountant's. Your part is paperwork that is accurate on its face.

Answering quickly in December

A buyer with a deadline sends the same request to three suppliers and orders from the first complete answer.

Promise a reply within one working day through December, and keep the promise. If the business closes over the holidays, put the dates on the website and in an automatic reply that names a contact for urgent requests.

A phone number on the quote helps too. Some approvals happen in a call between two meetings.

The counter-case

Businesses that sell mainly to households will see little of this, and none of it is worth building for a single December order.

Large contracts that go through formal bidding take months, not weeks, and follow the buyer's own rules. This is about the smaller purchases a manager can approve alone.

And some clients' years end in March or June, so their rush comes then. For anyone selling to companies, though, packages, quotes on letterhead and matching invoices are worth having ready before the rush.

Before the rush

1. Publish three packages with prices.
2. Make a quote template on your letterhead.
3. Add your GST number and payment terms.
4. Copy the purchase order number onto every invoice.
5. Prepare a one-page supplier sheet.
6. Post your December hours and reply times.
7. Ask regular clients when their year ends.

Step four is the one that decides whether you are paid this year. Everything else wins the order; a matching invoice is what turns it into money before the budget closes.

Selling something now that is delivered later is also the subject of gift certificates for a service business.

Frequently asked questions

West Coast Media Solutions Inc. provides web design, web development, hosting, digital marketing, and business consulting to organisations across Canada, drawing on more than twenty-five years in the field.