A Proforma invoicing software pricing is one of the invoice models that is commonly used as a fitting invoice in a business transaction. The difference with an invoice is that a proforma invoice contains transaction information that is sent before the delivery of goods or service assistance is carried out.

Understanding Proforma Invoice

A Proforma invoice is one of the necessary documents required in a sales and purchase transaction. A proforma invoice is a precise invoice given by a supplier or seller to a customer before sending goods or services.

This proforma invoice is also often referred to as a replacement invoice because it is given when the delivery of goods or services is carried out in stages. So, this document helps remind customers to pay off the payment for the goods or services they purchased.

Difference between Invoice and Proforma Invoice

Invoices contain information about the goods or services purchased, the amount of the bill that must be paid, and the payment terms that the customer must pay. Invoices or invoices are official and are usually sent or issued when the purchase has been completed (for example, a purchase of 500 chairs has been completely delivered to the customer’s location).

Meanwhile, a proforma invoice is a summary invoice sent to customers before the delivery of goods or service assistance. The pro forma invoice contains information about the model and quantity of goods or services purchased, the value of the goods or services, and other necessary information such as weight and shipping costs. Additionally, proforma invoices are usually used as invoices along with quotations.

The most drastic difference between invoices and proforma invoices is the recording of transactions. The transaction recorded on the proforma invoice is still in the form of a draft so it must receive confirmation from the customer before it can be processed into an invoice.

You can manage invoices and other transaction documents using the mauju.com Invoice Management Software service. Starting from generating invoices, and sending invoices, to carrying out reconciliations, everything can be done in one integrated application.

Proforma Invoice Function

In general, there are 7 proforma invoice functions that you should know, including:

  • A pro forma invoice is an estimate of the price that must be paid to settle the bill.
  • Record all product estimates that will be purchased by customers or customers.
  • The buyer can make improvements to the goods or services, as well as the value purchased if what is recorded does not match the order.
  • A valid reference for entering transactions into financial books.
  • A valid reference if the goods or services listed will later be sold by the customer to another party.
  • Valid reference as a tax invoice for certain cases.
  • Reference if there is an error in the transaction, such as an error in the quantity of goods sent.

Use of Proforma Invoices

When do companies use proforma invoices? For what type of transaction does a company issue a proforma invoice?

In some transactions with prepayment, the seller must issue a proforma invoice to confirm that the financing of the purchase is guaranteed before completing the order.

Companies can also issue and send proforma invoices as a form of payment request to buyers. If this is the case, it can be concluded that the following sales are likely to occur.

Why is it most likely to occur? Because there are times when transactions between sellers and customers are canceled or are still under consideration. Therefore, the proforma invoice is seen as a meaningful sales proposal if the transaction is still in process.

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Elements of Making a Proforma Invoice

If you want to produce a proforma invoice, there are several things you must include in the document, including:

  • Seller identity.
  • Proforma invoice date.
  • Name and description of the product or service purchased.
  • Price, purchase quantity, tax rate, tax quantity, and overall purchase quantity.
  • Payment details.
  • Due date (if agreed).

You can enter other transaction information that is deemed necessary by the customer on the proforma invoice, including sales and marketing information.

Conclusion

A proforma invoice or proforma invoice is a replacement invoice sent by the seller to the customer before sending goods or providing services. A proforma invoice is sent before an invoice or bill is issued. As a seller, you can issue a proforma invoice for transactions that require a down payment, or if the transaction is still in the system with the buyer. Manage invoices for all business transactions more easily