What is a commercial invoice?

How to create a commercial invoice?

1. Insert your company logo

   As with any invoice, you can customize your document by including your corporate logo. Even if you don't have a logo, make sure to put your company name in bold, easily-recognized letters at the very top of your commercial invoice. Doing this can help you stand out and increase brand awareness with your international clients.

2. Label your invoice

   Don't count on your recipients to identify your document at a glance. Labeling your commercial invoice helps all parties involved understand the document's importance. When the recipient sees it, they should know they're being asked to render payment for the shipment they have received.

3. Add your company contact information

   Next, you'll insert your company name and contact information. You can include any information you prefer, though it's customary to have details such as:
   
   - Business name
   - Physical address
   - Phone number
   - Email address
   - Website
   
   It may also be helpful to designate a point of contact at your company who will be responsible for sending the invoice and receiving payment. If you designate an employee, you might also list their name ("ATTN: John Doe") under your business name. You can then list their contact details, such as their extension or email address.

4. Specify the country of origin

   This step may seem a bit redundant, especially if your country is included under your contact info above. But it's plausible that a company could operate in one nation but manufacture goods in another and even have an overseas warehouse for shipping and receiving.
   
   Including the country of origin prominently on your commercial invoice will make it easier for Customs authorities to process your shipment, which can make the entire shipping process smoother.

5. Include the shipping method

   In addition to the origin and destination of the shipment, a seller should also include the method of transport on a commercial invoice. This means you'll specify the exact method of transportation and as many details about the shipping route as possible.
   
   You may hear this data referred to as "incoterms," which is short for "International Commercial terms." It's customary to provide detailed information about the methods and people responsible for each step in the shipping process.
   
   Including these details will provide additional context for Customs workers to understand how these goods are being brought into the country. In turn, this can expedite the Customs process and get your packages to the buyer on time.

6. List the contact information for the buyer

   Just as you recorded your company's contact information, you'll also record the contact info for your buyer. This includes the same basic details as above, including:
   
   - Name of the buyer or business
   - Physical address
   - Email address
   - Phone number
   - Website
   
   As before, if the buyer provides you a point of contact, it's perfectly appropriate to include this individual information, so long as the other information accurately reflects their business details and the destination of your packages.

7. Record the invoi

   Next, you'll record the invoice number and the invoice date. What is a commercial invoice number? This number is primarily used for internal accounting purposes and is used by both buyers and sellers. it can be matched to a corresponding purchase order number. Together, these numbers can be used to track outstanding invoices and your cash flow.
   
   Your customer may also be expecting to match invoice numbers with a purchase order number for their own accounting needs. These numbers don't really impact the Customs process, but they can be important for monitoring your shipments and payments.
   
   The invoice date should reflect when the invoice was sent — not necessarily when the shipment was received. This will become important in establishing a deadline for outstanding invoices and receiving prompt payment from your clients.

8. Include a description of the goods being sold

   The next section will likely be the longest, depending on the variety of goods you're shipping. Here, you'll include the quantity and description of every item within the shipment.
   
   Be specific. Part numbers may be helpful for your inventory purposes, but Customs authorities will expect to see detail about the type of goods you're shipping and even the material they're made from. For example, if you're sending t-shirts, you'll want to specify "Men's shirts, 50% cotton, 50% polyester."
   
   Make sure to include the correct amount and price of each item to comply with duty requirements and other fees. You'll also include the gross weight and the net weight of your shipment. Your net weight reflects the quantity of goods being shipped, while the gross weight will also include the weight of any packaging or shipping materials.

9. Record the HS code

   What is an HS code? Sometimes referred to as the "export code" or "commodity code," the Harmonized System Classification is a standardized way of sorting products involved in international trade. Typically, the HS code is 10 digits long. Customs agents will use it to assign duties and taxes to the items you're shipping.
   
   It's also customary to include a brief summary of your shipping contents below this code. That way, there will be no confusion about the nature of your products. This is essential for the Customs process. Underpayment of your duties and taxes can have legal consequences for you and your business.

10. Record the order total

    The next section is standard for any invoice. Here, you'll record the subtotal of all items that the buyer will receive, as well as the grand total once you factor in additional fees or any applicable buyer discounts.
    
    Customs agents may pay particular attention to this section to verify that the transaction is legitimate. Make sure that you include the correct price of each item. You may also be expected to provide proof of the transaction to satisfy the Customs agents.
    
    Remember, as the seller, you're responsible for paying all duties and taxes associated with international trade. Therefore, your commercial invoice should not include these fees unless you've made prior arrangements with the customer as part of a contractual agreement.

11. Communicate your payment process

    As with any invoice, you'll need to include information about your preferred payment method(s) as well as the terms of the sale. In other words, communicate clearly whether you take credit cards, check, or other payment methods.
    
    You can also communicate any penalties or fees for unpaid or overdue invoices. Encourage your clients to pay promptly by assessing a small (10% to 15%) charge on any invoices that are not paid by the deadline.
    
    You can choose any deadline you wish, but it's common for the seller to specify that money must be received within 30 days of the invoice being sent.
    
    Conversely, you can also offer a small discount as a thank you to customers for paying within a week of receiving their invoice. This ensures a faster transaction and builds goodwill with your customers.

12. Record your insurance information

    Finally, you'll want to provide proof of any insurance on the freight you're sending. It's also important to include the details about the person maintaining the insurance policy, the cost of the policy, and some basic information about the terms.