Quote vs Proforma invoice: what each one is for
Small businesses often run the quote and the proforma invoice off the same template, so the only visible difference is a word in the header. The differences that matter are not visual: who sends it, what it commits anyone to, and what happens in the accounts.
Side by side
| Quote | Proforma invoice | |
|---|---|---|
| Issued by | the seller | the seller |
| Sent to | the buyer | the buyer |
| Stage in the flow | 1 — offer | 4 — preliminary bill |
| What it does | states what the seller will supply and at what price, before any commitment | shows the buyer what the final invoice will look like, often to arrange prepayment, a letter of credit or import paperwork |
| Commitment | offer only | not binding |
| Requests payment? | no | no |
| Proves delivery? | no | no |
| In the accounts | not recorded in the books; it is a pre-sale document | not booked as a sale; no tax point is created |
| Lifetime | carries an expiry date, typically 14 to 30 days | usually valid until the stated date or until the real invoice replaces it |
| Make one with | Quotation Maker | Invoice Maker |
The deciding difference
Both are sent before delivery and both show the final price, which is why exporters and importers muddle them. The quote is an offer the buyer may decline; the proforma is issued after the buyer has said yes, to enable prepayment, a letter of credit or customs paperwork, and it looks like the real invoice on purpose.
Legal weight is the cleanest separator. The quote is offer only: An offer the seller stands behind until its expiry date; nothing is owed by either side until the buyer accepts it. The proforma invoice is not binding: A preview of the final invoice, issued before goods ship; it is not a tax invoice and creates no obligation to pay.
Where each one sits in the flow
The quote is issued at stage 1 and the proforma invoice at stage 4 of the eight-step order-to-cash sequence. The steps between them, if any, are the documents that normally connect the two:
- 1. Quote (this page) — The seller's priced offer, valid until a stated date.
- 2. Sales order — The seller's confirmation that an order is accepted and will be fulfilled.
- 3. Purchase order — The buyer's formal order: what, how many, at what price, delivered where and when.
- 4. Proforma invoice (this page) — A preliminary invoice sent before delivery, used for prepayment and customs, not for the books.
Steps before the quote and after the proforma invoice are on the business documents hub, which shows the full eight-step sequence with a checklist for every document.
Worked scenario
Selin Textiles quotes a German buyer €12,400 for 200 rolls of fabric. The buyer confirms and asks for a proforma to open a letter of credit. Selin issues proforma PF-0311 with the same lines, the shipping terms and the bank details; the buyer's bank pays against it. The commercial invoice INV-2026-0918 follows when the rolls ship, and only that document goes into the sales ledger.
Can one replace the other?
Neither replaces the other. The quote has to exist before the proforma invoice makes sense, and a file that holds one without the other has a gap an auditor will ask about. Businesses that skip the quote usually discover why the first time a proforma invoice is disputed.
Numbering and matching
Both carry their own number. Quote: Numbered so an accepted quote can be referenced on the order and the invoice that follow. Proforma invoice: Numbered separately from real invoices, and clearly labelled 'proforma', because it must not enter the sales ledger or a tax return. The reference from one to the other is what lets an accounts team match documents without phoning anyone.
Common mistakes
On the quote side, watch for treating a quote as an order and starting work before the buyer has accepted it in writing. On the proforma invoice side, watch for recording a proforma as revenue or claiming tax on it, when it is not a tax invoice. The order-of-events list above is the check: if a document is being issued out of sequence, something upstream is missing.
Checklists: what to include in a quote and what to include in a proforma invoice.