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Proforma invoice template

Proforma Invoice Template

A Proforma Invoice is effectively an invoice that is used to provide an estimate or quote and can be subject to change. This is what makes it different from a commercial invoice which is a final and official invoice used for customs clearance declarations.

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What is a Proforma Invoice used for?

At the beginning of a new export shipment order, the seller will prepare and send a Proforma Invoice to their buyer to confirm the order details and typically request a deposit payment. In the global trade process, the exporter will usually require a deposit payment to confirm the order and start manufacturing the goods. A common example is a 30% deposit payment up front, and the 70% balance payment after the goods have been produced or shipped (the specific terms to be negotiated and agreed upon between the buyer and seller). Note that Proforma Invoices are issued pre-shipment, i.e. before the goods have been produced or delivered. Once the goods have been produced and are ready for shipment, sellers will request the balance amount to be paid on a Proforma or Commercial invoice. A Commercial Invoice is usually issued after the goods have been supplied and will contain the actual final product quantities and balance amount to pay which will be used by the importer during the customs clearance process.

How to create a Proforma Invoice

  1. Open IncoDocs

    Open IncoDocs in your browser and navigate to the 'Invoices' section.

  2. Create a new Proforma Invoice

    Click on 'New Invoice' and select the Proforma Invoice from the dropdown menu.

  3. Fill out & customize your doc

    Fill out document info, customize document fields to your needs and add your company letterhead. If you use Xero or Quickbooks Online, you can also connect your account and autofill data from invoices or quotes in your accounting system.

  4. Sign & seal

    Click on the signature box at the bottom of your document to create and place a digital signature then hit “Save & Quit”. On the document preview screen, click on the ‘More’ dropdown button and select “Add company seal” to place a digital stamp.

  5. Download or send

    Download or share invoices from IncoDocs in 1-click. You'll know when recipients have viewed your invoice and recipients can even pay the invoice online via credit card for convenience.

Your questions, answered.

What is a proforma invoice?

A proforma invoice template is a standardized document used in international trade to draft the details of a pending transaction. It outlines essential information like product descriptions, quantities, prices, and payment terms, ensuring consistency and accuracy in trade agreements.

What is the difference between a Proforma Invoice and a Commercial Invoice?

The 2 documents are essentially the same, however, there can sometimes be a difference in the quantity of goods stated on the Commercial Invoice to what is on the Proforma Invoice. This is because the quantity of goods ordered (from the Proforma Invoice) can be different to the actual quantity of goods that have been shipped (on the Commercial Invoice).

This difference can be due to many reasons, however the most common is that a supplier is having manufacturing issues or delays or that the supplier did not correctly plan how many products would fit inside shipping containers. It is because of this disparity that a Commercial Invoice is typically issued after the goods have been delivered or shipped to ensure it accurately represents the final number of goods shipped.

How does a Proforma Invoice work with a Purchase Order?

A Proforma Invoice is typically issued by the seller upon receiving a Purchase Order from a buyer. These are important documents that are used to officially confirm all order and product information to avoid any confusion or problems with the supply and delivery of products. Any additional information agreed upon between the buyer and seller can be included on these documents.

Both parties will have to counter-sign each document as they represent a legally binding agreement between the buyer and seller. If there are any disputes relating to the order or supply of goods, these documents will be referred to in a court of law. Read how importers and exporters digitally countersign Proforma Invoices, Purchase Orders and other Sales Contracts

What information is included on a Proforma Invoice Document?

Seller’s Details - company name, address and contact information
Buyer’s Details - company name, address and contact information
Method of Dispatch – Road, Rail, Air or Seafreight
Type of Shipment – FCL, LCL, Breakbulk or other
Port of Loading and Port of Discharge (seaport or airport)
Reference Number and Date
Product Descriptions – including item codes/SKUs, Product Descriptions, Unit Quantities, Unit Type, Price
Incoterm® – The selling term agreed
Any additional information - usually payment terms, lead times or estimated vessel details
Bank Details – the Proforma Invoice can include bank details requesting the buyer to make a payment
Name, date and signature of authorized company representative

How do you use a proforma invoice template in trade?

The proforma invoice template provides a structured way for sellers to present proposed transaction details to buyers. The seller fills in specific data about the goods and terms, such as agreed prices and advance payment requirements. Once the proforma invoice template is filled, it is sent to the buyer to help arrange financing or secure necessary import approvals. This template aids in aligning both parties on the terms, facilitating the smooth progression to production or shipment.

How can proforma invoice templates facilitate international trade?

Proforma invoice templates simplify international trade by ensuring that key details are consistently presented. These templates list required information like item descriptions, prices, and shipping terms. This uniformity aids customs in swiftly evaluating and processing goods. Sellers benefit from clear communication of trade terms, reducing potential disputes. Buyers also gain from having detailed cost and product information, aiding in their financial preparations and acceptance of shipments. Using our templates makes the entire trade process smoother and quicker.