Estimation with a Simple Proforma Invoice Template

To give your client estimation about what to expect at your business, give them an early heads up in the form of a proforma invoice about the pricing in your business.

A proforma invoice is a little bit different from the other invoices. A proforma invoice does not act as a request for payment. While any other invoices act as a request for payment and help a business to get paid as quickly as possible, a proforma invoice only shows the products and services of a business with each cost. A proforma invoice also includes shipping charges, taxes, and discounts. A simple proforma invoice template gives a business the right idea about how to make a proforma invoice.

A proforma invoice is usually issued and sent to a potential client earlier than a usual invoice. It is sent before the transaction and even the order form the client takes place. This is because a proforma invoice acts more like a sales proposal, which means that the transaction may or may not happen.

What are the functions of a proforma invoice?

A proforma invoice is different from the other invoices and that means the functions are quite different too despite some similarities. The functions of a proforma invoice are as follows.

  1. As a piece of information about the products or services ordered by the client.
  2. As the information on terms and conditions of the payment.
  3. The client can change their order if there is anything wrong or unsuitable with the product or service.
  4. A valid referral if the product is to be sold again.
  5. Keeps tabs and records on customers and their orders.
  6. Useful to help in the taxation business.


When do we use a proforma invoice?

Proforma invoices are used in two conditions.

  1. The product or service needs to be paid upfront. Some things need to be paid upfront, so a proforma invoice can help the client to make sure they understand the payment before ordering anything.
  2. The sales have a big chance to happen. Sending a proforma invoice can be a subtle payment request in some cases. This happens because the transaction has a very good chance of taking place.

In a simple proforma invoice template, it may seem similar to a usual invoice. The most noticeable difference is the date. A proforma invoice is sent to the client before the transaction happens, while a usual invoice is sent after the product or service is delivered.

After the transaction is taking place, you need to make sure you send the client an invoice to substitute the proforma invoice. After the transaction and payment are complete, then both the invoices can be kept as a record of the transaction.

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A proforma invoice is a different type of invoice. While the other invoice acts as a payment request, this invoice does not. Instead, it gives the client a clear estimation of what to expect when purchasing from a business. To make your simple proforma invoice, be sure to find the simple proforma invoice template that suited your business the most.


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