Lets first understand What is Proforma Invoice and where it is used.
According to this definition on Investopedia, Proforma Invoice is like a preliminary bill of sale sent to buyers in advance of a shipment or delivery of goods. Typically, it gives a description of the purchased items, notes the cost, as well as other important information like shipping weight and transport charges.
Proforma invoices are also sometimes referred to as estimates or quotes. Purpose is to give your customers an idea about how much certain number of goods or services will cost.
How to create proforma invoice using ProfitBooks
General business practice is to first create a quote or an estimate and present it to the customer. Once customer agrees to the sales terms, quantity and pricing, a proper invoice is sent to him. ProfitBooks streamlines this process by allowing to convert an estimate to an invoice with one click.
Steps for creating a proforma invoice:
1) By default, ProfitBooks refers to quotations as ‘Estimate’. To change this naming convention, go to settings and click on ‘Custom Fields/Preferences’.
2) Now, lets create a new Proforma invoice. Refresh the page and go to Income -> Estimate (menu label will be changed to ‘Proforma Invoice’ once you refresh the screen) and click on ‘New Proforma Invoice’ button
3) Select customer name, date and then enter product details. Click on ‘Add new row’ to add more products. Enter terms and conditions if applicable and click on ‘Save’ button.
4) You can email this proforma invoice directly to your customer by clicking on mail icon or print it for offline use.
5) Once your customer confirms that he is happy with the details mentioned on proforma invoice, you can either convert it to a Sales Order or an Invoice. To do this, open the proforma invoice and click on Edit button.
All the details of proforma invoice will be transferred to the new invoice. You can then email that invoice to your customer or add payment. Please note that once converted, the original proforma invoice will be locked for further editing.
Thats it! Now learn how to create an invoice.