If you have a business, you know what an invoice is. You are probably also aware that Billdu helps you create invoices on the go. But, have you heard of a Proforma invoice? If not, you could be wondering what is a Proforma invoice? We want you to understand exactly what this vital piece of your business is, we’re going to outline it for you. We’ll also walk you through a step by step tutorial on how to create a pro forma document using Billdu’s printable proforma invoice templates.

Understanding a Pro Forma Invoice

As a seller or business owner, getting clients, negotiating the working relationships terms, and deciding on a price all common business practice. However, you want to ensure that everyone is on the same page once you work out all of the finer details that come with negotiating a new contract. This is where a pro forma invoice comes. Basically, it acts as a precursor to your official invoice.

This document will let your clients know exactly what services or products you’re going to deliver, your timeline for delivering said goods or services, and how much the project will end up costing your customers. It’s a short heads up before you send the normal invoice for payment, and it can help your customers from being blindsided by the price or duration of the project.

It helps everyone get on the same page for expectations, and it also gives your customers time to organize their finances so they can pay your invoice when it comes through. It’s essential that you know that your pro forma invoice isn’t a true VAT invoice though. However, it can help your project go along more smoothly because everyone will have the same expectations.

There are dozens of reasons why you’d want to use this type of invoice for your business, and they include but are not limited to:

• Declare the value for your services or goods
• Inform your customers of the payment terms and the due date
• Let your customer know which payment methods your business accepts
• Notify your customers of the delivery details and dates
• Outline the goods or services your business will provide
• Send your customers a statement of how much your services or products will cost

It works to square away the many small details that can hinder a project or a payment, and it ensures that everyone is ready for the project to start or to receive the goods they need. Once you officially start the project or deliver the goods, you can send out an official invoice.

Items to Include in Your Proforma Invoice

Before we walk you through how to create a proforma invoice, it’s important that you know everything that you should include. This way, you can be sure that you populate the correct fields each time you use a pro forma invoice template at your business. 

Header 

The first section you’ll work on filling in is your header. It’s extremely important that you have the words “Proforma Invoice” clearly displayed here. Your header should also contain your business’s logo and name. It makes it easy for your customers to locate it if they misplace it. You typically print it on your business’s letterhead, so you’ll typically have this information.

Invoicing is a way to demonstrate your professionalism. We can help you to cover the whole range of what to include on an invoice.

The next section on your header is where you fill in your company’s contact information. You’ll list your mailing address, telephone number, website, email address, and the country of origin. The date you created the invoice, the date your customers requested it, and the date the invoice expires is also helpful.

Customer Contact Information 

In order to help keep all of your invoices separate and easy to find, it should include your customer’s name or business name along with their contact information. List their mail address, company name, phone number, and company email address very clearly on your invoice.

Invoice Dates and Number 

Each invoice you send out should have a unique number because you’ll reference it in your business’s accounting information, and the customer will also use it in their accounting system. While you can start anywhere you’d like and use any numbers you like, they should be sequential. This means that if this invoice’s number is “Invoice #00112,” the next invoice you send out should be “Invoice #00113” to keep things organized.

You’ll take these unique numbers and use them in a tracking system. When you pull the unique number, you should instantly be able to tell which customer you sent the invoice to, the date you sent the invoice, and when the customer’s due date is.

Reason for Exporting Your Goods 

If your business exports goods, you have to explain on the invoice why you’re exporting them in the first place. You should note whether or not the items in question are a sample, a sale, a return, a repair, or a gift. If it’s a temporary export due to repairs and it’s going to come back to you, you can put that it’s a “temporary export.”

Shipping Information 

How do you plan to ship your goods to your customer? How many packages are there, and what do they all weigh? You should have this clearly listed on your invoice. 

Itemized Charge List 

Arguably one of the most important features on your proforma invoice sample is your itemized list of charges. This is where you have to be as specific as you possibly can because not being clear enough on this section is a huge reason many customers reject the invoice. The more specific and detailed you are, the less likely it is that a buyer will go with someone else. At the very least, you should include:

• Each good or service has its own line
• A detailed description that outlines what you’re selling or providing
• Number of units you plan to include
• Price point per unit of every individual item on your list
• Total cost

Shipping, Tax, and Total 

You want to double check any tax laws to help you calculate the correct sales tax for your shipment. You also want to add any necessary shipping and handling charges. If you’re exporting to another country, this includes any duties that customs levies. This should be clearly shown on a single line. Add it together and put it on your total line. If you don’t, you could be liable for hundreds of excess dollars in customs fees, shipping, or taxes.

Footer 

The final part of your invoice is the footer. This is at the very bottom of your invoice, and it’s where you can include any miscellaneous information. You can use it to outline your return policy or your guarantee. Also, it’s a good idea to put a short thank you in here for your customer because a little courtesy on your part can go a long way.

Ways to Create Your Proforma Invoice

You can use Google invoice maker to pull free pro forma invoice templates. They usually come with areas that you can quickly and easily edit and fill in to create customized invoices to send to your clients.

Many companies offer printable invoice templates that you can download, print off, and fill in the relevant information. This is more time-consuming to do, and you either have to mail it out to your customer or scan it into your computer before you send them an email.

Creating a Pro Forma Invoice with Billdu

At Billdu, we make it quick and easy to create an invoice online and track your invoices. We have filters in place on your dashboard that allow you to see all of your paid, unpaid, and overdue pro forma documents. We’re going to give you a step by step tutorial on how to create your invoice sample below to show you how user-friendly our platform is.

Later on try our trial how to create invoices online.

Step One – Create an Account

The first thing you have to do is go to Billdu.com and click the “Login” button on the upper right corner. This will open a new tab where you can click “create account.”

When you hit create account, you’ll enter your business name, email, and password before clicking “Create account” to finalize it. It’ll log you in and show you your dashboard. Now you can move to step two. 

Step Two – Complete Your Business Profile

Before you can create any invoices, Billdu will prompt you to create your business profile, and you can open it by clicking the “Let’s Do This” button below the “Please complete your business profile first” box. Once you click it, a screen will open and ask you to fill in: your business name, country, street, zip code, city, and your province/state. The second section is where you choose whether you not you want to have taxes or no taxes on your invoices, along with your business’s tax registration number.

You should also fill in your contact information with your name, email, phone number, fax number, and website. You can upload your signature and your business logo as well.

Step Three – Complete Your Payment Profile

Once you fill in your business profile, there’s a second tab you can open that allows you to fill in your payment information. You’ll fill in your account holder’s name, bank name, routing number, account number, whether or not you want to set up online payments and link directly to your bank account, and a PayPal email address if it’s relevant. Once you finish, click save.

Step Four – Set Up Your Proforma Invoice

At this point, you can either stay on your dashboard and customize your branding with your chosen free invoice sample, color choices, and layout, or you can make your proforma invoice. For this tutorial, we’re going to go straight to the invoice. To get there, select the “Documents” tab on the upper left side of the screen. A drop-down menu will open, and you can pick the correct invoice format. In this case, it would be the pro forma invoice. When you click it, a template will show up.

Step Five – Fill in Your Invoice

You start by clicking the blue “New pro forma invoice” button on the upper middle portion of your screen. When you click it, you’ll see:

If you don’t have any client lists loaded in, you’ll click the + button to create a new client listing. A small box will open when you do this, and you’ll have to fill in the billing name, country, street, zip code, city, state/province, tax reg number (optional), email, contact, phone number, website, and fax number (optional). When you fill this in, click save.

You’ll continue to fill in your invoice once you populate the client information. It’ll populate a pro forma number of 001, but you can change this. You’ll add the invoice issue date, due date, and a reference.

There’s a “More Items” option you can click that reveals a few more boxes you can populate. This includes the payment method, and you choose the way your customer is paying from the drop-down menu, which currency they want to use, and the language. The next portion to fill in is your item, the quantity, price, and any taxes. Once you get everything in, you can hit the save button.

Step Six – Double Check Your Invoice and Send It

Once you hit the save button, your invoice will open on your dashboard. This is where you double check that everything is correct and good to go. You’re now ready to download your pro forma invoice as a PDF file, email it out, or keep it and add payments as they come in.

Your dashboard will automatically help you keep track of all of your pro forma invoices, and it’s easy to tell at a glance whether or not they’re overdue, paid, or unpaid.

There are several ways you can create an invoice for your customers. You have the more traditional way of writing them out by hand, or you can utilize invoice software and free templates to generate them and get them sent out. If you’re curious about the different invoice methods, we’re going to outline several different types below. This way, you’ll be able to decide which one will work best for your business and incorporate it into your systems.

Traditional Ways for Creating Invoices

There are two main traditional ways to create invoices for your customers and vendors. Many older business owners use these methods because it’s familiar to them. They’re rare today because many invoice creator software are so user-friendly, but you can find them now and again.

Manually Input Your Data

You can work off one set template and manually input all of your data. It can be a hard copy or on a simple template that you type out and print. You have to put all of your items into your products or services in one by one, list the costs, and total it all up at the bottom of the template.

While there is a slightly lower risk of errors because you’re checking everything as you put it in, it can be a time-consuming process. It’s also slightly impractical for larger businesses that process hundreds of invoices each day.

Pen and Paper

Believe it or not, some people still prefer to write out their invoices with traditional pen and paper. You can get paper books that come with a basic invoice template, and you simply fill in the relevant information with each customer. They usually have lines where you can list your products or services and the quantity.

You’ll also list the prices in the correct area with an overall total at the bottom plus any taxes you charge. These invoice books can come with the business name, address, and phone number as well. Again, they’re time-consuming to fill out, but you reduce your risk of errors.

Electronic Ways for Creating Invoices

Technology has come a long way in all areas, and this includes offering free invoice software and downloadable free invoice templates. Many large and small businesses made the switch to electronic invoice creation because it saves time, and you can usually automatically populate your fields and send them out through email.

Template with a Text Editor

One of the most simple electronic ways to create invoices involves getting one or two templates and opening them in your preferred text editor. There are fields that allow you to input your items, services, quantities, and the total cost. You can customize these templates to display your business’s name, address, phone number, email, and any other relevant information.

Since it’s electronic, it also opens the door for email delivery, or you can print it out and hand it directly to your customer or vendor. It helps your business to project a sleek and current image.

Spreadsheet Invoice Template

Spreadsheet invoice templates are very popular with both large and small businesses alike that send out several invoices every day. You can build your own invoice template in Excel, or you can choose a free template and import it into your spreadsheet program.

Once you get all of your business’s information in and saved, you can use the same template over and over again. All you have to do is populate the fields with a description of your products or services, the quantity, price, and the final amount in a total column. They’re straightforward, fast, and they give you a uniform look.

Accounting Software

Depending on the accounting software you use, they can automatically generate invoices with everything populated into the correct fields when your accounting team works on your business’s books.

Businesses like this type of software because it can show them in real-time how their budget is, how high their expenses are, and how much money they have coming in and going out with each invoice. It can also help you keep track of multiple invoices for different customers or vendors at the same time, and it reduces the chances of errors because your team looks them all over.

Simple Online Invoice Generator

Simple and interactive online invoice generators are gaining popularity very quickly. They let you choose your language of choice, currency, date format, tax labels, color, and the template you’d like to use. You can add your supplier and customer information with a few quick clicks, and they have the issue date, due date, and a numbering system to help you keep track of multiple invoices at once.

You can also find invoice generators that let you add notes and greetings, set reminders, and accept credit card payments. They come designed to be very user-friendly and comprehensive, and this can help you get your money quicker.

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Invoice Management App

Finally, we have invoice management apps. Gone are the days of struggling to make your invoices, send them out, keep them all organized, and double check that you get payments on all of them. Instead, businesses now have the option of choosing invoice management apps like Billdu to take care of the hard work for them.

This app lets you create and send invoices with a few clicks, know when your clients see your invoices, set payment reminders, and give your customers the opportunity to pay right away. There’s also a mobile invoice app that lets you manage and keep track of your invoices when you’re on the go. Nevertheless, using an invoice app such as Billdu can automate the creation of recurring invoices, saving you a lot of time and hassle.

Comparing Traditional vs. Electronic Invoice Systems

Now that we’ve outlined the seven most popular ways businesses create free invoices, we want to make a quick comparison of the traditional vs. electronic invoicing systems. If you don’t have a system in place, this can help you decide which one is a more viable option for your business to use.

Storage Space

It’s far cheaper and easier to store electronic invoices over paper invoices. All you need to store your electronic invoices is a computer system. Paper invoices require file cabinets and constant upkeep to keep them neat. Most electronic systems automatically have organizational settings you can use to search for your invoices by name or number without having to try and go through hundreds of papers one by one.

Ease of Use

Sharing and finding paper invoices can be a time-consuming process. If your customer isn’t at your business and they request a copy, you either have to mail it out or scan it in, attach it to an email, and send it off. With electronic systems, it’s usually a few clicks of a button to bring up the invoice and get it on the way to the customer. You can also share them between computer systems almost instantly.

Labor Costs

You have to have staff in place to help manage your paper invoices. Your staff has to correctly file, collate, match information, staple check stubs or money order copies to the invoices, pull them when there is a new payment, and keep track of old invoices. With electronic systems, the software usually does this for you, and it uses a fraction of the labor that you’d use with a paper system.

Locating Time

It’s very easy to misplace, misfile, or outright lose paper invoices. This can result in hours of fruitless searching if you have to pull them up for any reason, and losing an invoice is paramount to the work or service never making it to the client if they choose to dispute it. Electronic documents usually with come with some ability to search for them. You can search by invoice number, customer, date range, and more.

Portability

How easy is it to pick up your laptop or even your phone and take it with you? If you have an app linked to your record system, being able to view your invoices is as easy as pulling out your phone. Paper invoices mean that you have to store and transport boxes or folders of invoices each time you move, and electronic invoices are much more portable for everyone involved.

Change Tracking

Maybe you want to see who made changes or updated your invoices. Unless they sign or initial the paper invoices, you have almost no way of knowing. This is especially true if you have a large department that works on the invoices. Many electronic invoices let you track the different versions, and everyone has a unique identifier that allows you to easily see who made what changes to your invoices.

Reliability

One of the problems with electronic invoices is reliability. If your network should crash, or should you get somewhere that you don’t have access to a computer or phone, you can’t get to your records. If there’s a massive power outage, your information is out of reach. Paper invoices are reliable. You can store them on or off-site, and you always have access to them as long as you can get to where you store them, whether or not you have power.

Accidental Deletion or Theft

Unfortunately, software makes it very easy to accidentally delete large batches of data all in one go. If you don’t have backups or copies stored somewhere, you can quickly be out months of invoices. It’s harder to accidentally toss out months or years of paper documents. Also, it’s more difficult to steal large amounts of paper documents without someone knowing. You can hide thousands of digital documents on a small USB.

Pros and Cons of Electronic Invoice Systems

Online invoices come with pros and cons, and you want to get a clear picture of the biggest ones because it can be a big change to switch from traditional invoicing to using free invoice software to create your invoices.

Pros of Electronic Invoicing

1. Convenience– There is a huge convenience factor with using electronic invoices for both the person sending the invoice and the person receiving the invoice. They can have it in their email in minutes, and you can offer multiple ways to instantly pay in full or a portion.
2. Greater Control for Finances – If you accidentally forget to pay an invoice, you’d normally end up paying late fees. However, even if you’re a day before your invoice is due, you can submit an electronic payment that can potentially process by the next day.
3. Automatic Reminders– Invoice creators allow you to set automatic reminders if your customers don’t may a payment or pay your invoice in full by the due date. These automatic reminders mean you don’t have to spend as much time chasing after your customers.
4. Reduces Overhead – Once you get an electronic invoice system in place, you can lower your costs spent with postage and printing. You won’t use as much ink because you send the invoices straight to email.

Cons of Electronic Invoicing

1. Conversion Cost – Depending on the system you choose, it can be very expensive upfront to convert all of your paper invoices to electronic. A way around this would be leaving your paper invoices in their original state and just do electronic invoices going forward.
2. Software Compatibility –Not all software or computer systems are compatible. This means that you’ll either have to find an alternative system to use, or you’ll have to upgrade everything.
3. Formatting Risks– Not all template formats are compatible, and this means that you may not be able to open them at some point. Currently, Adobe Acrobat (PDF) one of the preferred formats, but if it were to vanish, you wouldn’t be able to open or view your invoices.
4. Quality Control – In a perfect world, all of your invoices would be extremely high-quality, have a nice balance, and be very easy to read. However, it can be difficult to maintain this higher quality across all of your electronic invoices.

Try Billdu and Creating Invoices Today for Free!

Are you ready to create professional and sleek free invoices? Maybe you’re wondering how to create invoices that can be stored, reused and automatically aggregated. Either way, we want to help! Try our free invoice generator to start or register for a free trial to get the access to the full Billdu invoice maker features.