How to Write an Estimate
Review what needs to be done., Determine how long the job will take you., Decide if you'll need additional help., Figure out what materials you'll need., Research your competition.
Step-by-Step Guide
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Step 1: Review what needs to be done.
Before you can provide a customer with either an estimate or a quotation, you need to know exactly what they want you to do.
Expect to ask a lot of questions, as people often can be vague about their needs.Keep in mind that sometimes a customer won't actually know what goes into a job – they just know what they want the final outcome to be.
In many professions, this means you must actually visit the customer's work site to evaluate the job properly.
For example, if you are in construction and the customer wants to add a new deck onto the back of their house, you'll need to look at the state of the ground below where they want the deck to be, as well as evaluate how they want to attach it to the house and how the house itself is built. , For the purposes of an estimate, you only need a rough ballpark.
However, it's important to be realistic in your assessment of time to complete the project because this will determine the ultimate price you give the customer.If there will be outside work involved, you'll need to make allowances for possible weather delays depending on the season in which the work will be done. , If you already have a crew that normally works with you, additional labor may not be as big of a deal for you.
However, if you typically work alone, you must assess the job realistically and decide whether you'll have additional expenses for sub-contractors or specialists.The date by which the customer wants the job done also factors into this.
For example, it may be possible for you to complete the job on your own, but it would take you three weeks to complete it.
However, the customer needs to have the job completed by the end of the week, which means you would need help to meet that deadline.
You also want to keep other commitments in mind.
If you know it would take you 20 hours to complete a job on your own, but you've already committed to projects that will take 40 hours of your time during the period the customer wants the job completed, you may need extra help so you don't over-extend yourself. , Any estimate should include at least a ballpark figure of what the costs will be to you to complete the project.
If the job requires tools that you don't own or have available to you, find out the cost for purchasing or renting those tools.Purchasing new tools may be preferable if you anticipate you will need them for other jobs in the future.
You typically can deduct these purchases as business expenses on your taxes.
Keep in mind that if you decide to do that, you can't pass on the full purchase price to your customer.
If you have basic materials that you frequently use for different jobs, keep price lists for reference so you can save some time when you're calculating an estimate. , You want your estimate to be competitive, but at the same time you don't want to charge so little that you end up not making any money.
Find out what similar professionals in your area are charging and stay in that range.Keep in mind that "competitive" does not mean that you should aim to underbid the competition.
You won't make any money that way, and potential customers or clients may be suspicious if your estimate seems too low.
Have confidence in your skills and your work product.
However, you do want to have a general idea of the skill level and experience of similar professionals in your area.
For example, if you have 20 years experience, you would want your estimate to be considerably higher than someone who's only been in business a year, because you have more to bring to the table.
To find out what similar professionals in your area are charging, check listings on websites where professionals can advertise or promote their services.
If there is a professional or trade organization in your area, they also may have information on project prices based on survey results. -
Step 2: Determine how long the job will take you.
-
Step 3: Decide if you'll need additional help.
-
Step 4: Figure out what materials you'll need.
-
Step 5: Research your competition.
Detailed Guide
Before you can provide a customer with either an estimate or a quotation, you need to know exactly what they want you to do.
Expect to ask a lot of questions, as people often can be vague about their needs.Keep in mind that sometimes a customer won't actually know what goes into a job – they just know what they want the final outcome to be.
In many professions, this means you must actually visit the customer's work site to evaluate the job properly.
For example, if you are in construction and the customer wants to add a new deck onto the back of their house, you'll need to look at the state of the ground below where they want the deck to be, as well as evaluate how they want to attach it to the house and how the house itself is built. , For the purposes of an estimate, you only need a rough ballpark.
However, it's important to be realistic in your assessment of time to complete the project because this will determine the ultimate price you give the customer.If there will be outside work involved, you'll need to make allowances for possible weather delays depending on the season in which the work will be done. , If you already have a crew that normally works with you, additional labor may not be as big of a deal for you.
However, if you typically work alone, you must assess the job realistically and decide whether you'll have additional expenses for sub-contractors or specialists.The date by which the customer wants the job done also factors into this.
For example, it may be possible for you to complete the job on your own, but it would take you three weeks to complete it.
However, the customer needs to have the job completed by the end of the week, which means you would need help to meet that deadline.
You also want to keep other commitments in mind.
If you know it would take you 20 hours to complete a job on your own, but you've already committed to projects that will take 40 hours of your time during the period the customer wants the job completed, you may need extra help so you don't over-extend yourself. , Any estimate should include at least a ballpark figure of what the costs will be to you to complete the project.
If the job requires tools that you don't own or have available to you, find out the cost for purchasing or renting those tools.Purchasing new tools may be preferable if you anticipate you will need them for other jobs in the future.
You typically can deduct these purchases as business expenses on your taxes.
Keep in mind that if you decide to do that, you can't pass on the full purchase price to your customer.
If you have basic materials that you frequently use for different jobs, keep price lists for reference so you can save some time when you're calculating an estimate. , You want your estimate to be competitive, but at the same time you don't want to charge so little that you end up not making any money.
Find out what similar professionals in your area are charging and stay in that range.Keep in mind that "competitive" does not mean that you should aim to underbid the competition.
You won't make any money that way, and potential customers or clients may be suspicious if your estimate seems too low.
Have confidence in your skills and your work product.
However, you do want to have a general idea of the skill level and experience of similar professionals in your area.
For example, if you have 20 years experience, you would want your estimate to be considerably higher than someone who's only been in business a year, because you have more to bring to the table.
To find out what similar professionals in your area are charging, check listings on websites where professionals can advertise or promote their services.
If there is a professional or trade organization in your area, they also may have information on project prices based on survey results.
About the Author
Kimberly Miller
Creates helpful guides on DIY projects to inspire and educate readers.
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