Export and Import documentation | import export business practical training by Harsh Dhawan

A proforma invoice is a preliminary document provided by an exporter to an importer in international trade. It serves as a detailed quotation, outlining the agreed-upon terms and conditions of a potential transaction before the actual commercial invoice is issued. While not legally binding, it offers a clear understanding of the goods, services, and associated costs, which aids in decision-making and customs clearance.

The proforma invoice typically includes essential information such as the seller's and buyer's contact details, a description of the goods, quantity, unit price, total value, payment terms, delivery terms (e.g., Incoterms), and the estimated shipping date. It may also highlight taxes, duties, or other charges the buyer might incur.

In the import-export business, this document is vital for securing import permits, arranging financing, or applying for a letter of credit. It ensures transparency, reduces misunderstandings, and sets expectations for both parties.

For the exporter, it helps secure the buyer's commitment, while the importer uses it to evaluate costs and complete necessary regulatory formalities. By facilitating communication and streamlining processes, the proforma invoice is an indispensable tool in global trade.