Proforma Invoice vs. Standard Invoice
When to Use a Proforma Invoice
A proforma invoice is the right tool when you need to communicate expected costs before a transaction is finalized. Common use cases include:
- International trade and customs — Customs authorities require an estimated value of imported goods. A proforma invoice provides this without requiring a completed sale.
- Custom or bespoke orders — When a client is commissioning custom work or products, send a proforma invoice to confirm pricing before production begins.
- Advance payment requests — For large orders or long-lead-time projects, a proforma invoice communicates the deposit amount and final balance before you begin work.
- Supplier quotes with firm pricing — When a buyer needs a formal cost preview from a specific supplier before approving a purchase order.
- Government or institutional procurement — Many public-sector buyers require proforma invoices as part of their requisition and approval workflow.
What to Include on a Proforma Invoice
- "PROFORMA INVOICE" label — clearly identify this as a proforma, not a commercial invoice
- Your business name, address, and contact info — the seller's details
- Buyer name and billing address — who's receiving the goods or services
- Invoice number and date — for your records and reference
- Itemized description of goods or services — quantities, specifications, and unit prices
- Total estimated value — in the appropriate currency
- Incoterms or delivery terms — CIF, FOB, EXW, etc., for international shipments
- Estimated delivery or completion date — expected timeline
- Validity period — how long the quoted prices and terms remain valid
- Payment terms — advance payment percentage, deposit required, etc.