The 28 Day Billing Cycle

Most firms issue "monthly" invoices every 4 weeks, becoming a 28 Day cycle.
This results in 13 monthly" invoices in the year.
The easiest way to understand and to work with the 28 day billing cycle is to manually mark up a wall calendar.

MARK YOUR WALL CALENDAR:

Take a wall calendar, and manually mark EACH day on the entire calendar with the correct cycle billing day code.
BEFORE YOU BEGIN, look at Review Calendar to see what billing day code should be used as the first code to begin the calendar month.

Number each day including weekends 1 through 28, and once you reach code 28, start over again numbering at code 1.
Mark the calendar for the ENTIRE year.
Refer to Cycle Billing Days for information on how the Billing Day Codes define when each contract is billed.
After you have billed each day, mark an X on the calendar on that day to track where you left off with the billing.

HOW A 28 DAY CYCLE WORKS:

Cycle Billing runs can be initiated independently for each cycle billing day, or once a week or once a month to bill all unbilled eligible contracts up to their latest full billing period.

• Billing a Single Day Code at a Time:
  All contracts that have the same Billing Day Code are billed with the same Cycle Billing run.
  All contracts that have the same Billing Day Code went out on the same day, or went out in 28 day intervals from that day.
  e.g. Contracts going out on a Tuesday, will be billed on a Tuesday every 4 weeks.

          Example  1:
          1st monthly invoice:  Billed from Dec 1st  10 am   To Dec 29th 10 am
          2nd monthly invoice:  Billed from Dec 29th 10 am   To Jan 26th 10 am
          3rd monthly invoice:  Billed from Jan 26th 10 am   To Feb 23rd 10 am
  
  
          Example  2:
          1st monthly invoice:  Billed from Dec 5th  8 am   To Jan 2nd   8 am
          2nd monthly invoice:  Billed from Jan 2nd  8 am   To Jan 30th  8 am
          3rd monthly invoice:  Billed from Jan 30th 8 am   To Feb 27th  8 am
          
  

  Note: With this approach it is important to run the Cycle Billing Edit for each day code, or else some contracts will be skipped.

• Billing All Day Codes:
  If the option All Billing Day Codes is selected in Cycle Billing Edit then all unbilled contracts will be billed up to the last date matching their Billing Day code.
  This billing run will be comprised of contracts with varying Billing Day Codes, each billing for their own 28 day interval.

  An advantage of this approach is that no contracts will be skipped as all Billing Day Codes are included.

ADVANTAGES OF THE 28 DAY CYCLE OVER THE MONTHLY CYCLE:

The monthly cycle generates 12 monthly invoices in a year as outlined in The Monthly Billing Cycle.
Some advantages of the 28 Day Cycle include:

• 13 "4 Week" invoices issued to the customer instead of 12 "monthly" invoices means extra revenue without extra equipment rental or handling

• Invoices are issued sooner, so payment can be expected sooner resulting in increased cash flow.

• Invoices are issued sooner, satisfying construction contracts that must have their job costing done as soon as possible.

• Little resistance is met from customers when firms change their billing policy to 28 Days.
  Often a software change is the reason given for the policy change, and few customers object.

• The software keeps track of when the contracts need to be billed.
  On a manual system, 28 day billing was too complicated - simplified monthly billing was required to keep the manual system straight. This is no longer the case, since the software keeps the contract billing organized.

• 28 Day Billing is becoming the Rental Industry standard. Most companies now issue their rate cards based on Day/Week/4 Weeks, not Day/Week/Month.

• To get the invoices out faster (and payments back faster), some firms don't wait until the end of the 4th week to issue their bills. Instead, they issue the invoices one week in advance, i.e. after 3 weeks they issue the invoice with a billing period of 4 weeks. The rationale is: after the customer has had the equipment for 3 weeks, the 4th is free anyway. Even if the equipment is returned before the end of the 4th week, there would be no adjustment in the billing required. To activate this, set each customer in Customer Information with 1st CYCLE BILL PERIOD = 21.

If your firm uses a combination of 28 day and monthly billing periods to meet customer requirements, refer to Default Billing Method in the Calendar to setup the billing day codes correctly, and activate the Respect Customer Cycle Bill Interval option in the Company Billing Parameters so that individual customers can be flagged with their billing preference in Customer Billing Settings.