Quotations are editable word documents that businesses provide to a buyer to offer their products or services at a specified price and under specified conditions. It also indicates important information such as terms and payment conditions that both buyers and sellers agreed upon.
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Table of Content
- Quotation Definition & Meaning
- What Is a Quotation?
- 10 Types of Quotation
- Quotation Uses, Purposes, Importance
- What’s in a Quotation? Parts?
- How to Design a Quotation?
- Quotation vs. Invoice
- What’s the Difference between Quotation, Proposal, and Estimate?
- Quotation Sizes
- Quotation Ideas and Examples
Quotation Definition & Meaning
A quotation, also known as quotes or sales quotations, is a statement written or printed on a sheet of paper that contains the latest market price of a commodity or service.
It is used to name or publish the current bids and offers or lists of prices of commodities or services offered by sellers to a potential buyer which includes detailed information on taxes, raw materials and labor, and other factors that contribute to the final cost.
What Is a Quotation?
A quotation is a written document or a verbal agreement between a buyer and seller that states a fixed price for a service. Quotations are usually used by companies that sell goods or services. With this document, buyers are able to generate new business opportunities for their companies’ development.
10 Types of Quotation
An audit quotation is a list of prices or charges for specific auditing services that accounting companies offer to their potential clients. By highlighting their products or services and their prices, businesses allow clients to evaluate their proposals. While it is not a necessity, issuing an audit quotation can be seen as an opportunity to enhance a company’s brand awareness.
A cleaning quotation is a document that outlines the estimates for cleaning services prepared by businesses for a contractor. It is used when a potential client needs cleaning services on a regular or weekly basis. Some establishments that need this service include offices and retail stores.
A company quotation, also known as a price quote, is sent by a prospective client. When a customer wants to engage in a new business deal, they ask companies to send them a detailed quotation. Company quotations directly represent their branding and professionalism.
Consultant Quotations are documents that list down all services provided by consultancy businesses and the fees they will charge. An example of an effective consultant quotation is given below. With a clear consultant quotation design, clients can avoid confusion about what services they are paying for.
An event quotation is a document that a business provides to an event organizer. It has a list of priced items, services, products, materials, and labor used for the event. This allows clients to be informed about the flow of their money used to make a successful event.
Service quotations include a company’s information like a detailed price list, expiration date, and customer information. It also provides a breakdown of the prices of each service for a comprehensive presentation to the clients. With this, clients can estimate the costs of various services they’ll need.
A marketing quotation, also known as a stock market quote, provides detailed pricing and information on a specific stock and its trading activity. This quotation is usually used by buyers and sellers who want to conduct trades. When they agreed on a price, an order will be considered as completed.
When a company is in need of outsourced experts and specialists to complete a project, these experts and specialists are asked to send a project quotation. This quotation includes a non-binding estimate of the work they must complete. It also helps in assessing if a project is practical.
A business quotation is a detailed breakdown of a company’s services, products, and prices. This allows clients to estimate the cost of their particular project. Once a cost summary is provided, clients can make better decisions on their budget planning.
Real Estate Quotation
Real estate brokers use real estate quotation as the most important step in negotiating a real estate deal. This is a document prepared by a real estate agent for a potential buyer. This allows clients to measure their financial capability before buying a property.
Quotation Uses, Purposes, Importance
Quotations are used by businesses to ensure they only provide good customer service. The construction of a sample quotation helps sellers initiate a discussion with potential buyers. Listed below are the factors that make quotations useful and important.
Provides Common Ground
If a project needs a lot of labor and time, business owners need to understand the scope of a project before taking it. Quotations allow both buyers and sellers to understand each other’s job responsibilities. It also informs them of what is to be done and how much it will cost.
Creates Services’ Minimum Base Rates
Many changes will occur in the whole duration of a project. Providing a quotation before starting a project establishes a base rate for the job and what it covers. When a client wants a change, business owners can refer to their original scope of work and update their quotations.
Helps in Budget Management
One of the challenges for many businesses is keeping cash flowing. With signed quotations, businesses can forecast their cash flow and profits. This also allows them to invest in necessary resources for future projects.
Every customer wants to know that they can trust their business partners. Offering quotations enable businesses to show transparency in their pricing. This document also serves as a way to show clients that even a small business is truthful enough to form partnerships.
Provides Protection from Failed Payments
Not every client would pay their bill on time and in full. Delays in payment are common in many industries. Quotations serve as a piece of evidence that clients accepted a written quotation for the work they received.
What’s in a Quotation? Parts?
Providing business details such as the business name, address, contact number, company website, and email address is a must in a quotation.
Total Costs of the Services
This part of the quotation provides a detailed job description and an outline of what costs cover and what is not.
A Detailed List of Costs
This describes the job proposal, details the elements involved, and lists costs for manpower and materials.
This part of the quotation explains how different events may affect the costs of the services and serves as an opportunity for businesses to upsell.
This provides an opportunity to revise a quotation if a job changes greatly once the project begins.
This includes the time when the project starts and the duration it takes to complete.
Payment Terms and Conditions
This part of the quotation allows business owners to indicate the date when a payment is required, including options such as periodical payments or half up front and half on completion.
Quote Expiry Date
This indicates the date when a quotation is accepted by.
This part of the quotation includes a ‘sign here’ statement to fix the agreement which includes the name of the customer and the accepted terms and conditions.
This part of the quotation indicates a business’ preferred method of payment.
How to Design a Quotation?
1. Choose a quotation size.
2. Decide on the purpose of the quotation.
3. Select a quotation template.
4. Change the structure or format of the quotation template by adding what is needed and removing what is not.
5. Adjust the pricing options.
6. Modify the terms and conditions.
7. Add your business logo.
8. Finalize and download.
Quotation vs. Invoice
Quotations are printable documents that contain services and products and price lists provided by businesses for their potential clients.
An invoice is a document that buyers give their sellers to collect payments which include the cost of purchased products.
What’s the Difference between Quotation, Proposal, and Estimate?
A quotation is used by businesses to increase their branding which is sent to clients who need detailed information on their services and pricing.
A proposal is a formal or written document that is used to persuade a prospective client from both public and private companies.
An estimate is a rough or approximate calculation of the value, number, quantity, or extent of a service or product.
Listed below are samples of commonly used quotation sizes when writing a creative quotation:
Quotation Ideas and Examples
If you are looking for quotation ideas, the list below has a variety of options that might give you useful ideas.
- Quotation Ideas and Examples
- Advertising Quotation Ideas and Examples
- Construction Quotation Ideas and Examples
- Quotation Ideas and Examples Software
- Ideas and Examples for Catering Quotation
- Tips and ideas for freelancer Quotation with Examples
- Maintenance Quotation Ideas and Examples
- Rental Quotation Ideas and Examples
- Quotation Ideas and Examples for Website
- Training Quotation Ideas and Examples
How do you write a business quotation letter?
A business quotation letter should be written as a formal letter or created using a professional quote template with a layout that must include the sender’s and receiver’s addresses, the date of issue, itemized lists of products and services, specified terms and conditions, and the sender’s and receiver’s signatures.
How to make a quotation template in Excel?
To create a quotation template in Excel, select the right size of the quotation document online, select a blank template, adjust its structure including its pricing options and terms and conditions, double-check the entire structure, and download it for printing, which you can also save as a doc or pdf.
What information should be included in a quotation?
Quotations should include information on business details, breakdown of total costs, variations and revisions, terms and conditions, payment methods, work schedule with an expiry date, and the customer’s acceptance signature as well as the business’ quote number, customer’s details, and product or service descriptions.
How to send a quotation to a customer?
Quotations can be sent to customers by publishing in print media or by formal letter and must include details about the product with its price and timeframe, as well as guarantees and warranties.
How to write a quote for services?
To write a quotation for services, it must include an itemized list of services requested by the client, prices for each item including labor cost, taxes, and discounts, details on the scope of the project, and the company’s branding in the form of a logo or letterhead created with the use of graphics.
What is a business quotation?
A business quotation is a document that companies present to potential clients, which includes a list of services and the prices for each, the quantity needed by a prospective client, and the total amount of the transaction.
What are the contents of the quotation?
The contents of a quotation include a validity period, bidding date, customer’s address, product description, list of terms and conditions, and customer’s signature.
What is a price quotation?
A price quotation is a written document or a pledge that contains a list of fixed price offers with a specified validity period that cannot be changed once accepted by the client.
What do you say when sending a quote to a customer?
To send a quote to a customer, it must include detailed information about your products and services, as well as their prices to provide your client a rough idea of your business.
What is a sales quotation?
A sales quotation is a document that identifies the cost of a business offering which enables potential buyers to estimate the costs of a specific product or service before purchasing it.