Assuming an estimate and a quote are the same is a common mistake, but it’s important to note that they are not comparable. Understanding the difference between these terms and what they include is crucial for your project. Knowing how they are used will enable you to ensure that you are comparing like for like when choosing a builder.
At Locspec Building Services, we pride ourselves on our open and transparent approach to presenting itemised quote proposals to our clients. We believe it is important for our clients to understand exactly what is included in their scope of work and where their money is going. This open approach allows our clients to make informed decisions about their project and reduces the likelihood of budget blowouts.
By providing detailed and clear information, we empower our clients to make the best choices for their new build or renovation. Understanding the difference between an estimate and a quote is a key part of this process. Keep reading for our comprehensive breakdown of these terms and how they impact your construction project.
What is an Estimate?
An estimate is an approximate calculation of the cost of a job based on initial information. It is often provided during an early stage of the project, such as an initial phone call or site visit.
Here are the key points about estimates:
- Approximate Cost: An estimate gives a rough idea of the cost based on the current understanding of the project.
- Flexible: The final cost may change as more details become available or if unexpected issues arise.
- Purpose: Helps clients budget and make initial decisions.
- Non-Binding: Estimates are not legally binding and should not be considered a final price. For example, if a client, Mrs. Smith, calls to ask about the cost of skimming her spare bedroom, you might provide an estimate based on her description of the room being “average sized” and needing old wallpaper removed. This estimate is a rough guess and subject to change.
What is a Quote?
A quote, or quotation, is a fixed price offer based on a detailed understanding of the project. It is provided after a thorough assessment, often including site visits and detailed plans. Here are the main aspects of a quote:
- Fixed Cost: A quote provides a specific price that does not change unless the scope of work changes.
- Detailed Assessment: Quotes are given after thoroughly analysing the project’s requirements.
- Purpose: Provides clients with a precise financial commitment.
- Legally Binding: Once accepted, a quote is a legally binding agreement. For instance, after visiting Mrs. Smith’s home and assessing the room, you might discover it is larger than average and requires more time to remove the wallpaper. Your detailed quote would reflect the true cost of the work, including any additional charges. Key Points to Remember
- Estimates: Use as an initial guide. They are rough approximations and not legally binding.
- Quotes: Provide a fixed price and are legally binding agreements.
- Clear Communication: Always ensure the client understands whether they are receiving an estimate or a quote.
Frequently Asked Questions
Should I Always Provide a Written Estimate or Quote?
Yes, always provide written estimates or quotes. This helps resolve any misunderstandings later and serves as a record of what was agreed upon.
Is it OK to Handwrite My Quotes or Estimates? Handwritten documents are acceptable but should be readable and professionally presented. Use headed stationery with your business name and contact details.
What Details Should I Include in My Estimates or Quotes?
- Estimates: General job description, approximate cost, and a disclaimer that the price is subject to change.
- Quotes: Customer details, job description, breakdown of costs (labor, materials, etc.), total price, VAT details (if applicable), and terms and conditions.
Do Estimates and Quotes Need Dates?
Yes, dating estimates and quotes helps track when they were prepared. Specify the validity period, typically 30 to 90 days, to protect against cost changes over time.
Understanding the differences between estimates and quotes is essential for clear communication and successful project management. Estimates provide a rough idea of cost, while quotes offer a fixed price based on a detailed assessment. Always ensure your clients know which one they are receiving to avoid misunderstandings.
Interested in a Consultation?
With your questions answered clearly, the estimate and quote process should reassure you of your builder’s honesty and integrity. If you’re still struggling for clarity, it may be time to reconsider. At Locspec Building, we’re upfront about the financial reality of your project, with transparent quotes and hands-on project management from the start. You deserve a stress-free building journey and a premium quality custom home within your budget.
Ready to discuss your building vision? Reach out to our friendly and experienced team. HERE
