The purpose of a pro forma invoice template is to make sure that both parties are on the same page about an agreement that is being contemplated for business purpose.

Proforma Invoice Templates

What is a pro forma invoice?

Pro forma applies to incomplete invoices. This means that a sample pro forma invoice doesn’t have an invoice number. This is a requirement for all legal invoices. Moreover, this invoice is just a quote or estimate where you would outline the goods or services that you commit to selling.

A pro forma invoice template also includes the prices of the services or goods. With this invoice in their hands, prospective clients get an overview of the costs of the products or services so that they can make a decision.

What is the difference between an invoice and a pro forma invoice?

An invoice is a commercial tool that typically contains the total amount for services or products due to the customer whereas a pro forma invoice is merely a seller’s declaration to provide services or products to the customer on a set date and time.

Proforma Invoice Samples

Why do you need a pro forma invoice?

The importance of a pro forma invoice sample becomes evident when two businesses plan to do business together for the first time, as well as, for import or export transactions. Here are some reasons why you need this invoice:

  • To provide details
    This type of invoice specifies all of the details of your transaction so that the customer knows the exact amount they will pay and as such, it leaves no risk of confusion or misunderstanding. Additionally, the invoice helps you close deals because it makes clients feel at ease about the terms of your transaction.
  • It helps enable payment
    One important use of a sample pro forma invoice is to secure credit for the client for purchasing the goods or services that you offer. If you have international buyers, they can use this credit before you ship out the goods. Without the invoice, many internationals transactions never even take place.
  • For crossing borders
    You can use the invoice to help secure consular invoices, customs paperwork, and for determining shipment values needed to calculate import taxes and customs duties. This applies to many countries worldwide. With this document in hand, those involved can process paperwork, thus, decreasing the total time transit.
  • It expedites invoicing
    A commercial invoice can be quickly finalized then dispatched to a customer for payments as soon as you have finalized the pro forma invoice.

Does this type of invoice require a payment?

The customer’s accounts payable department can issue payment in advance against an actual document by using the pro forma invoice template you provided. The presence of this invoice avoids confusion as to how much or what they owe.

Upon the completion of the transaction, you can make a reference to the invoice number on a standard invoice. This prevents any duplication of payments by the customer.

Proforma Invoice Examples

How do I create a pro forma invoice?

Although the pro forma invoice template is not used by the Accounts Payable or Accounts Receivable departments, it is still an official document and you as a seller are legally bound to its terms and conditions.

The pro forma invoice sample is an offer to sell you should not undervalue it. Here are the steps to guide you when creating this document:

  • Begin with the header
    The first part of the document is the header and it must contain the words “Pro Forma Invoice.” You might also want to include the name and logo of your business. These make your business stand out.
    In almost all cases, you would print the invoice form on the official company letterhead and should already include the mentioned information. Include your contact details next, then the date when you created the invoice and the expiry date.
  • The contact details of the buyer
    The next information should be all about your buyer and this includes their name, phone number, mailing address, the name of their company, and their company’s email address.
  • Add the invoice number
    Every invoice requires a number and you will use this number to reference your business’ accounting information and that of your buyer. The numbering system you choose is your decision. You can start anywhere you want, as long as, you have sequential numbers.
  • State your reason for exporting the goods
    If you plan to use the invoice to export goods, you have to explain in the invoice your reason for exporting them.
  • Include the shipping information
    State the mode of transport, how many packages you plan to send, and the shipment’s total gross weight.
  • Create an itemized breakdown of the charges
    There is a need to break the shipment down and get into the specific details. You must be as detailed as possible.
    Most pro forma invoices aren’t accepted because the information provided was either unimportant to the buyers or the seller didn’t inform the buyers on everything they should know. The more specific you are with the details, the less is the chance that the buyer will opt for another supplier.
  • Indicate details like shipping, tax, and total amount due
    Before making any calculations on proper sales taxes, you need to check the tax laws first. Don’t forget to include the handling and shipping charges necessary. For exports, this usually includes duties levied at customs by either of the countries. List the total amount and make sure to clearly state this in your invoice.
  • Add the footer
    Use this space to include additional information, like your return policy or guarantee on the goods that you sell. Finally, and as important, do not forget to thank the customer for their business. Remember the value of showing a little courtesy.
  • Consider including additional items if you see that there is a need for these
    Invoices created for international trade use should include information like the reference number of the buyer, the date of inquiry, the price of each of the items, the delivery point, any insurance details, costs of customs, and shipping, and the estimated shipping date from the airport or port.
    If you download a template, you can appropriately modify your invoice template if your business needs additional information fields.