I have a customer who is also a supplier to me. i need to do a contra where we have offset invoices owing to each other. How do i do this?

QB does not allow for that kind of contra account

receive the customer payment, deposit to a cash or clearing bank type account, then pay the bill from it

The solution I used for this situation was to create a Journal - Credit to Accounts Receivable (include the Customer Name) and Debit to Accounts Payable (include to Supplier name).

This will create offsetting credits in the customer and supplier. You will need then go to the customer and process a "Receive payment" to clear the invoices paid allocating the journal credit just created. Likewise with the supplier account, process a "Make Payment" to clear offset invoices.