What is a Proforma Invoice?
A proforma invoice is issued before the goods are produced or shipped. A proforma invoice confirms buyer’s purchase intent and is used by sellers’ to begin the procurement and manufacturing process. It contains provisional quantites and prices of goods.
When is a Proforma Invoice created?
A proforma invoice is created by the seller when the sale of goods are being discussed with the buyer. It is issued after the buyer has raised a purchase order. Hence, the proforma invoice contains the same quantities, prices and terms as mentioned on the purchase order. Acceptance, usually through a physical or digital signature, of a proforma invoice by the buyer indicates the seller can start procuring or manufacturing the goods.
Why is a Proforma Invoice important?
A proforma invoice in most cases is the first document created by the seller in the export process. Below are a few reasons why proforma invoice is important:
- It acts as a ‘good faith’ agreement between the buyer and the seller since it is not a legally binding document upon which the seller can request payment from the buyer.
- It is used to acknowledge buyer’s acceptance of the order including prices, quantites and promised date
- It can be used to resolve any disputes that may arise after the final goods have been procured or produced
- After a buyer signs the proforma invoice, it is used internally as a confirmation to proceed with procuring or manufacturing goods
How to create a Proforma Invoice on Cargoflip?
- Open Cargoflip
Open Cargoflip and navigate to the 'Documents' section.
- Create a new Proforma Invoice
Click on 'New' and select the Proforma Invoice from the dropdown menu.
- Fill out & customize your doc
Fill out document info, customize document fields to your needs. If you fill it once, we will let you create multiple once with an easy autofill feature.
- Sign & Stamp
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 stamp” to place a digital stamp.
- Download or share
Download or share invoices from Cargoflip in 1-click. You'll know when recipients have viewed your invoice and recipients can even add comments incase they have feedback all with just a link.
- 1-click create other documents
You can create rest of the shipping documents with 1 click by autofilling the data from this doc in other docs.
What’s included on a Proforma invoice document?
Shipper: Name and address of the shipper
Consignee: Name and address of the consignee (receiving party)
Invoice Date: Date invoice was issued
Method of Shipping: This could be SEA, AIR, TRUCK or RAIL
Type of Shipment: FCL (Full Container Load), LCL (Less Than a Container Load), FTL (Full Truck Load), LTL (Less than a truck load), Air, Break Bulk
Country of Origin: Country where the goods were manufactured
Country of Destination: Country where goods will be finally delivered (Usually the country where the buyer resides)
Port of Loading and Port of Discharge: Seaport or airport in respective loading and discharge locations
Departure Date: Date of Delivery or handover (depends on the incoterms)
Incoterms: Could vary from EXW, FOB, CFR, DDP, DAP. Checkout our detailed guide on incoterms.
Product details: Product descriptions, SKU numbers, quantity, price
Bank Details: Account information including account number and sort codes to the account you would like the buyer to pay to
Additional charges and discounts: Charges could include value added services, freight or discounts your sellers are offering
Name and signature of authorized signatories