Professional Tips Series – Writing Estimates

Professional Tips Series – How to write an estimate that wins you the job.

Are you looking for more customers? All too often we see vendors lose out on great opportunities because their estimates were simply not presented well. Knowing how to properly write an estimate is vital to growing your business and keeping your current clients coming back asking you for more. Remember that an estimate is your evaluation and is non-binding. If you issue your clients with a quotation that is viewed as binding, make sure to clearly note so you don’t get stuck.

The first step is to listen to what your clients are asking for and in turn ask them as many questions as you need to put together a clear estimate. Let your clients know that what you are doing is trying to gain a thorough understanding, so you can meet and hopefully exceed their request of you. This will always leave your clients feeling as though you completely understand what they are looking for. You are at this point successfully managing their perception of your business and your skills to handle the task for them, which is important. Also important to remember that often clients don’t fully understand what all of their options are, so be sure to give them your thoughts on the task(s).

Frequently clients will go with the first contractor who responds with an estimate

Once you have all of your questions answered let your clients know how long you think it will take for you to complete their estimate. Be sure to confirm their contact information including their email address. Then your next step is to figure out how long it should take for you to complete the project and if you’ll require any outside assistance. If you do need some help then be sure to get these costs accurate. Be sure to clearly explain everything to your subcontractors/assistants so they can give you an accurate price. Remember an estimate is only a ballpark figure but it’s important for you to be as realistic as possible when assessing the amount of time needed to complete the project as this will determine your estimated price.

The next step is to determine what tools and materials you will need and your costs to have these ready to go in time to start your project. A great idea is to always keep a list of equipment and costs on hand so that in the future if asked again to complete the same or similar project you will be able to respond faster with a great estimate. Frequently clients are looking to get the project handled quickly and will often go with the first contractor who responds with an estimate so always be prompt and get their estimate back to them in a timely manner.

Do you know the prices your competition charge? Always try and determine their costs when you can so as to be able to offer competitive pricing. You may not know but always assume your clients know and act accordingly to win their business.

To draw up and prepare your estimate, use an official letterhead which gives your estimate a more professional look. If you don’t have a letterhead there are many very easy ways to create one using simple word processing programs. Make sure this includes your name, business name and complete contact information. Be sure to label your estimate correctly. Often this is best by placing the word “ESTIMATE” at the top of the page in bold text. You should also consider adding a disclaimer. Something like “actual final costs may be higher or lower than the estimate provided…”

The next step is to describe the services you are suggesting without going into extensive details. It’s a good idea to break these down into simple steps with an itemized price for each step on the estimate. Be sure to clearly note the material costs and then separately itemize your labor costs to clearly allow your clients to understand how you arrived at the final estimate price. Also be sure to note any information as needed on your business: License, insurance etc. This information may be required given your trade as well as local or state laws.

When you are ready, contact your clients and ask for some time to either meet and review the estimate in person, which is best, or offer to set up a phone call to ensure you are available to review each step with them. Again always be sure to clearly note on your estimate how you arrived at your final price. All too often we see estimates that don’t have this sort of information clearly presented and this only leads to more questions and time delays, and may result in a loss of business.

We trust this helps you and thank you for the opportunity to share our ideas with you.
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