Quotes in Business
Written by Admin | @sherpaindonesia
PictureQuotes.com
Quote is one of thing that make
business more improving. It explains about pricing for a job and gives the customer a clear cost for the work. When a customer asks for a quote, it means they are seriously considering doing business with the customer. Besides that, the right response that given to the customer make the marketer more close to the deal quickly and win new business. So, they are giving the
marketer a golden opportunity.
But don't celebrate just yet. The quotation process might seem like a formality, but it isn't. New business is won or lost at this stage, so it's important to get it right. In this guide we'll look at how people can make price quotes work for them. With the right approach people will get a better response. This will also help to pitch the services at the best price.
Why quotes are good for business
Price quotes are an essential part of running some types of business, especially service businesses. They are useful because they:
· help you and your customer understand each other.
· state the price, terms and conditions of business clearly.
· bring you closer to a sale by encouraging the customer to make a decision.
· legally protect buyers, which makes them more likely to do business with you.
· help you structure your pricing and the services you offer.
· encourage transparency between you and your customers.
The difference between a quote and an estimate
These two words are sometimes used interchangeably, but they can mean different things depending on what country you’re based in. A quote is usually a fixed price offer. It means that you have:
· studied the work involved carefully.
· discussed the requirements in full with your client.
· calculated the materials and labor required.
Once accepted, it has legal status in many countries. So you usually can't charge more for the work than you've quoted.
An estimate has less legal value than a quote. It gives the client a rough idea of what the job might cost, but there's no guarantee that the price won't change when the work is carried out.
You may have to explain this difference to some of your customers, so that they know what they're getting. They will probably prefer a quote to an estimate, because it gives them peace of mind. Good quotes are brief, yet accurate and comprehensive. They tell the client everything they need to know.
Think about pricing
Because a price quote is legally binding, think carefully about every quote you supply. Here are some points to consider when it comes to pricing:
· Do you fully understand the requirements?
If you have any doubts, go back and talk to the client. Make sure you know exactly what's involved. Otherwise you can't price it properly.
If you have any doubts, go back and talk to the client. Make sure you know exactly what's involved. Otherwise you can't price it properly.
· Can you meet the deadlines?
If the work must be done in a specific time period, do you have the resources? Don't over-commit yourself or your staff, or you may have to pay extra for temporary workers.
If the work must be done in a specific time period, do you have the resources? Don't over-commit yourself or your staff, or you may have to pay extra for temporary workers.
· Are your prices up to date?
Check your fixed and variable costs, including materials and labor. Remember to take everything into account, including currency exchange rates. These can and do change, which might affect your prices.
Check your fixed and variable costs, including materials and labor. Remember to take everything into account, including currency exchange rates. These can and do change, which might affect your prices.
· Have you included a fair profit margin?
You're in business to make money, so your quotes need to take that into account. You wouldn't make this obvious, of course, but your pricing should include a sensible profit margin.
You're in business to make money, so your quotes need to take that into account. You wouldn't make this obvious, of course, but your pricing should include a sensible profit margin.
What to include on your quotations
A good quote is a summary of your discussions with a client. It should include everything relevant to the job or service you're planning to provide.
Good quotes are brief, yet accurate and comprehensive. They tell the client everything they need to know. Here are some items to include:
· Standard business information
This includes your company name and address, the client's details, a customer ID number and a quote number.
This includes your company name and address, the client's details, a customer ID number and a quote number.
· Pricing
An overall total and itemized entries explaining each component. Keep this transparent and detailed, but not so detailed that it becomes confusing.
An overall total and itemized entries explaining each component. Keep this transparent and detailed, but not so detailed that it becomes confusing.
· Any applicable taxes
Such as sales tax, if your business is registered for it.
Such as sales tax, if your business is registered for it.
· Due dates
Or a timetable for delivery of the products or service.
Or a timetable for delivery of the products or service.
· A 'valid until' date
30 days starting from the quote date is the normal time period, unless prices change faster in your line of business.
30 days starting from the quote date is the normal time period, unless prices change faster in your line of business.
· Your terms and conditions (T&Cs)
These should be written in plain language to avoid confusion. Since this is a legal area, you may want to talk to a lawyer. But government small business websites often have T&C templates that you can use. Chambers of commerce can also help.
These should be written in plain language to avoid confusion. Since this is a legal area, you may want to talk to a lawyer. But government small business websites often have T&C templates that you can use. Chambers of commerce can also help.
· Space for signatures
Your own signature should already be present, along with the date. Leave a space for the customer to sign too. You could even let them sign online or via email, so you have instant receipt of their acceptance.
Your own signature should already be present, along with the date. Leave a space for the customer to sign too. You could even let them sign online or via email, so you have instant receipt of their acceptance.
Presentation is important. You can use good accounting software to prepare price quotes that look professional, with all the necessary information.
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