Estimate vs quotation vs invoice: what each one is for

Both are sent before the customer agrees to buy, and many businesses use the words interchangeably. The useful difference is how firm the price is.

• An estimate says "this is roughly what it will cost". You send it when the final figure depends on things you don't know yet: the exact quantity, the material the customer picks, how long the job takes. It should say that it is an estimate, so nobody treats it as a promise.
• A quotation (or quote) says "this is what it will cost". You send it when you can commit to a price, and you usually add how long the offer stands, for example 15 or 30 days. If the customer accepts within that time, you are expected to honour it.

In practice: a tailor who has not measured yet sends an estimate; a wholesaler with a price list sends a quotation. If your prices change often, say so on the document and keep the validity period short.

What both should include

• Your business name, address and contact details, ideally on your letterhead.
• The customer's name and a date.
• Each item with quantity, unit price and line total, plus the overall total.
• Whether tax is included or will be added.
• For a quotation, the validity period and your key terms, such as delivery time and payment terms.

Once the customer says yes, the paperwork moves from offering a price to billing for it.

• A proforma invoice looks like an invoice but is not one. It is a preliminary bill sent before goods are delivered or before payment, often so the buyer can arrange payment, get internal approval or open a letter of credit. It confirms what will be billed. In India it is not a tax document: the buyer cannot claim input tax credit on it, and it does not replace the tax invoice.
• A tax invoice is the legal bill for a sale. If you are registered under GST, you issue it when you supply goods or services, with the details GST rules require: your GSTIN, the buyer's details, an invoice number from a continuous series, the HSN or SAC code, taxable value and the tax breakup. It is what your buyer uses to claim input tax credit and what goes into your GST returns.

A simple way to remember the order: estimate (a likely price) → quotation (a firm offer) → proforma invoice (a preview of the bill, when needed) → tax invoice (the bill).

This is general information, not tax advice. GST rules change, so check with your accountant which documents your business must issue.

Here is where ScanPix stops, stated plainly: ScanPix does not create tax invoices. It makes estimates, not GST bills. It does not generate e-invoices, e-way bills or GST returns.

If you are registered under GST and need to raise tax invoices, use GST billing or accounting software for that step, or the invoicing your accountant already uses. You may need it if you:

• issue tax invoices to other businesses who claim input tax credit;
• must generate e-invoices or e-way bills;
• file GST returns from your own billing records;
• need stock, ledgers and tax reports in one accounting system.

ScanPix still helps around that software. Capture the tax invoices you issue and receive, and ScanPix reads and files them so you can find any bill by what it says. See document management.

Where ScanPix is fast is the step before the invoice: turning what a customer asked for into a clean estimate.

1. From a catalogue order. When a buyer orders from your ScanPix catalogue, the order opens in your WhatsApp and is saved in your Orders inbox. One tap turns it into an estimate PDF on your letterhead, with the items, quantities, prices and total.
2. From scratch. In the Orders screen, create a new estimate for an existing or new customer. Add products from your range or type a line in by hand, set the amount, and download the estimate PDF.
3. When the customer agrees. Convert the estimate into an order with one click, move it from confirmed to completed as you deliver, and raise the tax invoice in your billing software.

Send the estimate back on WhatsApp in the same chat. For the full walkthrough, read how to make an estimate from an order, or see the Estimates feature page.