Depending on your type of arts and crafts business, you may use customer proposals (also known as orders, quotes or sales agreements). A proposal is a tentative agreement between your arts and crafts business and a customer which lists the products and services you'r offering for sale. It also shows potential delivery and expiration dates, payment terms, and prices. Customer proposals are used to make sure you have a meeting of the mind with the customer regarding what you'll be delivering, at what price and the associated responsibilities of the customer.
I don't see alot of customer proposals with my arts and crafts business accounting clients. In the arts and crafts world, they are mostly used to bid on jobs. For example, my local airport was soliciting bids last month for artwork installations in a new concourse of the airport.
If you use some sort of accounting or invoicing software, the software probably has a menu option to create a customer proposal. If using a soup to nuts accounting software program like QuickBooks, the proposal will sit in the accounting software until you either delete it because you didn't get the job or convert it into an actual invoice. At that point, the invoice will post as an addition to revenue and accounts receivable or cash (if you've been paid).
If you're preparing a customer proposal manually, use the customer invoice example I provide in this article, changing the header to Customer Proposal. Make sure you cover all the important facts that I list in the first paragraph on this page.
See all my tips for preparing customer invoices.
