Is a Quote the same as an Estimate? No. A Quote is a fixed price offer and once accepted by a client it cannot be changed. It is not always possible to give clients a standard price for goods and services and it can end up costing you more than expected. If you are unsure of the costs and the price to quote it may be better to offer an Estimate. An Estimate is an educated guess and is not binding. In situations where there is potentially more than one circumstance that can affect a price more than one Estimate could be given to cover the varying possibilities.
When creating a Quote or Estimate you will need to know your fixed and variable costs. Fixed costs don’t change they are a fixed per unit cost like the cost for materials or the cost per hour for labour. Variable costs vary and change in relation to output like the number of hours of labour to complete a job. In creating a quote or estimate you would estimate the labour and materials required. Giving a detailed breakdown of all work performed and materials required at the appropriate charge will help to ensure there are no disagreements on what was supplied or what work was performed when time for payment arises.
Included in the price Quote or Estimate is the date prepared and the offer end date. You may want to include an authorized by signature and Estimate or Quotation number to ensure your paperwork can be traced in your system and has been authorized by an authoritative person in your company. Providing Quotes or Estimates can help your clients understand the expected pricing without any undue surprises when the job is completed. There should be no disputes about work performed or price to pay when both work to be performed and price are disclosed and in writing and reviewed by both parties before the job is started.
Before you Start Invoicing you may want to provide your client with an Estimate. Find out how you can convert an Estimate into an Invoice in one easy step.