Preparation of an accurate quote or variation to contract is critical to business success but it is surprising how many times builders and tradespeople get this wrong. A quote sets the expectations of your client, outlines the scope of work, and helps to determine the cost of the project and potentially becomes part of a contract, a legal document outlining your obligations as a builder. However, it is not uncommon for builders to make mistakes when preparing a quote, which can lead to problems including confusing the client as to the scope or methodology. In this post, we will focus on five common mistakes builders make when preparing a quote focusing specifically on quote structure, clarity and accuracy. Here are 5 problems I’ve seen with quote preparation:
Lack of clarity in item descriptions
It is essential to provide clear and precise descriptions for each item in your quote. The description should contain enough information for the client or a third party to understand the scope of work without having to speak to you. The item should contain the location and a brief description of the work to be executed - not just a note saying “carpentry” - this could be anything.
Lack of consistent structure and inconsistent formulas in calculations
You can't have different calculations in every line of your quote. The formula in each row needs to be 100% consistent and should never be adjusted. This will ensure that your calculations are accurate and avoid any confusion for your client. Your clients like to understand the pricing - if things are not consistent, confusing or worse still there are errors this is a really bad start.
Confusing quantities with measures
Quantities are numbers, such as 5, 4504, 24.04, and do not have units. Measures are one-word descriptions, such as item, hours, metres, m2, m3, days, months, or thousands (used to quantify bricks), tonnes, etc. The measure column should not contain descriptions and should be kept separate from the item column.
Inconsistent use of rates
The rate should always be a number with a dollar sign, such as $50.00, and should be consistent throughout the quote. This will ensure that the subtotal column aligns correctly with the rate column.
Inconsistent subtotal formula
The subtotal formula must finish at the last cell above the subtotal to ensure that no new line items can be added without affecting the subtotal. The subtotal at the bottom of the quote should align with the column it is subtotaling.
In conclusion, it is essential to pay attention to the structure of your quote to avoid common mistakes that can lead to confusion and problems down the line. By following these guidelines, builders can ensure that their quotes are clear, accurate, and comprehensive, leading to a successful project outcome. Remember - of course there are a million ways to do this - it’s the underlying principles that are important.
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