PI (Proforma Invoice)
A preliminary invoice the seller issues before shipment, listing goods, prices and terms, often used to confirm an order and request payment.
TL;DR: A proforma invoice is a draft bill sent by the seller before the goods ship. It sets out what you are buying, at what price and on what terms, and it is often the document you pay the deposit against.
A typical PI lists the seller and buyer details, the product description, quantities, unit prices, and the total amount. It should also state the currency, the Incoterm and named place, payment terms, bank details, estimated lead time, packing details and validity date.
In trade with China, the PI often works as a simple sales contract. When the buyer signs it or pays the deposit, both sides treat the order as confirmed. For large or custom orders, it is safer to also sign a separate contract that covers quality standards, inspection, and what happens if there is a delay or defect.
A PI is not the same as a commercial invoice. The commercial invoice is the final document used for customs clearance after the goods are ready to ship. Customs usually does not accept a PI in its place, except in some special cases.
Before you pay, check every line. Make sure the company name and bank account match the supplier you have been dealing with, and that sizes, colors and quantities match the approved samples or drawings. Changes are easier to fix before production starts. Compare with Commercial Invoice, RFQ and Deposit and Balance Payment.