A lot of companies rely on a standardized price list for presenting their products and services which remains the same when it gets to the client’s hands. There are larger and more complicated projects that are usually priced based on a detailed document the customer provides. If you don’t make it easy for your future customers or clients to see just what they would be paying for, it could also just as easily cost you the job.
Errors in quoting are often likened to that of resume errors, so if you’re guilty of making quoting mistakes, no matter how minor they are to you, it should come as no surprise if you don’t win the deal. Even when these mistakes don’t necessarily count as deal-breakers and the customer still choose to purchase, not quoting properly could still lead to a dozen or so issues down the line such as your business operations, billing, services and eventually, your relationship with customers. To make sure you get your quotation templates right, here are the elements it should have:
1. Business Information: Your company or business name is probably one of the most important and easiest information to put but you won’t believe how much it gets ignored. For your company to attract its target audience, people need to know who you are. Make sure you indicate the correct business name along with other brand information such as logo whenever you print and send out quotes. Aside from that, this information is actually required by law in most states.
2. Total Cost: A quote needs to indicate a detailed outline of what the job entails, what the costs cover, writing down, and being very clear about what the service or product doesn’t include when necessary, such as covering parts and labor, which doesn’t include delivery.
3. Breakdown: You have to describe the proposal for the task and write what it involves. Itemize the labor costs as well as the materials and equipment needed to complete the job.
4. Variations: Explain how different scenarios or variations will affect the cost. For instance, you can say that the quote covers lawn mowing. Taking away clippings costs an additional 20% (variations can be great opportunities for upselling, so make it count.)
5. Revisions: Make room for revisions on the quote if you deem it necessary or when the job takes substantial changes over its course, once the work has begun. Adjust the quote as needed, although this doesn’t mean changing all of it. Make sure you also explain the adjustment or revisions you have made to the client, to avoid misunderstandings.
6. Schedule: State the time-frame for the job because if you’re bidding for it and win it, you’ll be held by contract to finish the job based on the time you have indicated or set, so make sure it’s also a realistic deadline. If the schedule is going to be based on factors like the weather condition, time or resources constraints, make sure you state this as well.
Whenever a customer requests for a price quotation in word, as a business owner or manager, it’s really tempting to just hand them the total cost for their product or service. However, a quote should be more than just a dollar amount you send via text message or email. Preparing an appropriate price quote requires thinking more than just the figures because your quote is the preview to you and your business and what the customer can expect in doing business with you. A lot of customers are also savvy and it’s better to give them information well beyond the price. Here’s are the steps to do it right:
1. Know the work required: Do a research on the customer or client’s needs because you can’t just provide another organization a document of a breakdown and total cost without consideration over what goods or type of services the client needs and whether or not you’re capable of providing them. Customers can also misunderstand the difference what they want done versus what they actually need since they’re not part of the process involving the completion of a task or a job. This means you may have to go out and see for yourself then make your own evaluation before you start quoting.
2. Take down notes: Not all quotes are created equal. Some are valid only for a certain period of time, or when there are special details that your customer need to know. It is therefore important to establish this in the quote to avoid confusion and misunderstandings.
3. Estimate the project/job’s material cost: Whatever you’re using up, in terms of materials or supplies such as ink, print cartridge, pens, paper stock, paint, lawn care supplies or food items, come up with an estimate of the total cost. Add the cost you’re covering for shipping and handling, including applicable tax. If you have the resources and are authorized, provide a ballpark figure for all the materials needed.
4. Write it down: From the client’s point of view, a quote is a written record that gives them a chance to compare rates or prices for similar products or services among various businesses competing with each other. It is therefore crucial to have a written quote outlining the costs, breakdown and total which you can mail or email rather than just giving them the figures over text or via phone call. Getting your price quote in writing makes your transaction more credible and as professional as it should be. It also serves as a quick reference for when the customer need to calculate the cost for the service or product he is considering.
5. Determine how long the job will take: There are cases where a detailed quotation isn’t a legally binding document and your customer may just require a ballpark figure and breakdown of the cost of the service they want to take advantage of. However, it still remains an important part of the deal to get a realistic evaluation of how long it would take for the project to be completed or the task to be fulfilled. You also want to make sure it will be feasible since it essentially decides the figure you will have to provide to your customer.
Finding out the total cost of the product or service alone doesn’t give the customer enough information to base his buying decision on. Preparing an accurate quote is one of the best practices a company can apply in its transactions since it can answer a customer’s questions on pricing. Follow these simple tips to learn more:
Below are the most common types of price quotes which are often based on the products, the type of service and could also include the delivery:
In simple terms, a business or price quote is a breakdown of the individual charges that when added up, determines the total cost of a job. Unlike an estimate, a quote cannot change once agreed upon between the service provider and the customer.
A request for quotation (RfQ) is a standard business process inviting suppliers and service-providers into a bidding process so that they can bid on specific products or services. Once you hand an agreed-upon quote, both you and the customer cannot make any changes or adjustments, unless otherwise stated in the service contract.
When an interested customer asks for a quote, it’s a great opportunity for you to upsell and ask relevant questions to help you identify or verify the problem or need they’re looking to solve as well as their role in the decision-making and approval process for the final quotation. This is also where you get to know whether they are checking their options with competitors. Simply put, a quote isn’t just a document filled with dollar signs. You can use it as a way to take your potential customer through a satisfying experience they can have when they agree to do business with you or purchase your product. If you see the process just like a transaction, you’ll land more customers. It’s not just about price; it’s about their overall experience.