Understanding monthly invoicing
- Monthly invoicing is a payment setting in which Google extends a line of credit to you for your advertising costs, and you receive an invoice each month.
- In most countries, you can pay your invoice by check or wire transfer. However, the options might vary in your country. Your invoice will state the options available to you.
- You make payments according to the terms and conditions that you agree to when you enroll in monthly invoicing. There's no fee for using monthly invoicing.
- Typically, this payment setting is used by large advertisers and businesses—for example, an ad agency that manages its clients' AdWords accounts.
This article covers how to apply for monthly invoicing, use a credit line, and control costs.
You might be able to use the monthly invoicing payment setting if your business meets certain requirements. These requirement include, but aren't limited to:
- Being registered as a business for a minimum of one year.
- Spending a minimum of $5,000 a month (this can vary by country) for any 3 of the last 12 months.
If you meet these initial requirements and would like to apply for monthly invoicing, contact us. We'll review your credit history. If you're approved, we'll send you an email offering you:
- Payment terms: How much time you have to pay us after we've issued you an invoice. Typically, this is 30 days.
- Credit line: The maximum balance for all the monthly invoiced accounts that you're responsible for. This balance is made up of all unpaid advertising costs, including charges that have and haven't yet been invoiced.
Once you agree to these terms, we'll convert your account to the monthly invoicing setting. But remember that if you exceed either your payment terms or credit line, your ads may be slowed or stopped. We'll email your invoice, usually by the 5th business day of the month, with instructions on how you can pay.
Here are some tips for paying your invoice:
- When you make a payment, be sure to enter your invoice number in the description for it. Otherwise, your payment can't be matched to your account or invoice.
- You can make several payments toward one invoice. For example, you can pay half of the invoice in the beginning of the month and half in the second part of the month.
- However, don't try to pay multiple invoices with a single check or wire transfer. Each invoice should be paid separately, otherwise your payment won't be able to be matched.
- Pay the exact amount in your invoice, never more. Otherwise, the excess amount won't be able to be matched to your future invoices.
- If you pay by wire transfer, keep in mind that your payment can take up to 5 business days to reach your account. To avoid paying late, initiate the transfer by the 25th of the month, at the latest.
Monthly invoicing is often used to pay for multiple accounts. Here's an example of how it would work with two accounts:
Suppose you had two accounts on monthly invoicing and a $20,000 credit line. Let's say the two accounts' unpaid costs—invoiced and not yet invoiced—add up to $15,000, as shown in the table below.
Account 1 Account 2 Balance Invoiced costs $4,000 $3,000 $7,000 Uninvoiced costs $2,000 $6,000 $8,000 Total unpaid costs $6,000 $9,000 $15,000
In this case, your accounts could accrue $5,000 more in unpaid costs before reaching your credit line. Any payment you make would reduce that balance, giving you more available credit. Just remember to send in your payment on time and to include invoice numbers so it's clear where to apply your payment.
Once you've been assigned a credit line, you can calculate the maximum amount you can use as your daily budget. This is a good way to distribute your campaign costs over a certain time period. Here's how you'd use one:
Let's say you have an AdWords account with two campaigns, and you want to spend a total of $10,000 for the 30-day month. To make sure this $10,000 lasts the entire month, first decide how much you want to spend on each campaign. Suppose you want to dedicate $7500 to campaign #1 and $2500 to campaign #2. To find your daily budget, divide each amount by 30:
$7500 / 30 = $250
$2500 / 30 = $83.33
Following this formula, you'll assign campaign #1 a daily budget of $250 and campaign #2 a daily budget of $83.33.
Keep in mind that if you'd like to spend $10,000 per month and you have 30 days to pay your bill, your credit line has to be at least $20,000. Why? After the first month, you'll have used $10,000 of your credit line. So, by the time you'll have paid the bill, (i.e. after 30 days), you'll have spent an additional $10,000 with Google for that second month. That's why your credit line has to be at least 20k.
Your campaign daily costs might go slightly over or under your daily budget, but you won't be charged more for a campaign than your daily budget times the number of days in that period. This is known as overdelivery.
When setting your campaign budgets, keep in mind that your credit line will need to cover all your account costs, including:
- The costs accruing in your account(s) each day for which you haven't been billed.
- The costs for which you've been invoiced but haven't yet paid.
- The costs that accrue in your account while your previous month's payment is processed (a minimum of several days).
If you don't spend your daily budget each day, your monthly costs could be lower than you expect. That's why it's a good idea to check your costs partway through the month, in case you'd like to raise your bid.
To view your costs, follow these steps:
- Sign in to your AdWords account at https://adwords.google.com
- Click the Campaigns tab.
- Be sure that the "All" or "All but removed" filter is selected.
- Set the date range so you're viewing the information for "This month."
- See another way to control your costs, known as budget orders.