Business Basics: How To Get Quoting Right
Almost any business – from startups, to large corporations, contractors and freelancers – use price quotation. For some businesses, the quote for their product or service remains the same for all customers or clients. For others, such as civil engineers, they have to adjust their quotations based on the specific project or service that the customer requires.
What’s a business quotation?
So, what is a quote? It’s basically the price of a product or service that a business is offering. A quotation may also include the specifications of the product or service.
Every sale starts with a quote, so a quotation is often a company or firm’s first real touchpoint with a customer or client. That being the case, quoting mistakes can be detrimental for a business.
Unsure how to go about quoting as a contractor? Here are some tips on how you can get it right:
Pick a good quote template
The world is increasingly becoming digital. But despite the rapid digitization, many contractors still rely on pen and paper for documenting their services’ pricing. Not only can handwritten quotations be lost and damaged easily, but they may also appear illegible. It also makes a contractor appear less professional to clients.
For those who haven’t already, use an online estimate or quote template that prompts you to include all essential information as standard – and looks professional. There are all kinds of templates available online which have been created for different niches––this free contractors estimate template from Jobber is one such example. Others may require a one-time or subscription fee to access.
Whether you’re getting a free template or opting for a paid one, customize them as much as possible with your branding and logo and start using them as standard to promote consistency within your customer base.
Understand your clients
Adopting professional-looking quote template is a great start but simply using one won’t guarantee you business. Getting quotations right also means really understanding your clients’ needs. Find out exactly what they want or are looking to achieve and work with them to figure out how best you can service them. As the expert, you may have better ways or alternative ideas for doing something that they may not have thought of. Have these conversations before quoting for your service.
A better understanding of your clients’ needs and requirements allows you to customize quotes with the right profit-margin, while at the same time ensuring that you’re delivering the right service. Customizing your quote to meet client needs can mean including extra services, providing discounts, or changing the pricing completely, depending on what you and the client agree on. Having open dialogue with them prior to sending a quote will also mean that the information you put into the quote will be easier for them to understand, enabling them to decide to go ahead with the quote faster.
Preparing a quotation without fully understanding the client’s needs may result in mis-quoting where you risk incurring losses, or losing the business altogether.
Be realistic when calculating the price
Some contractors lower the price of their service to secure a project. It can be tempting to do this, especially when you’re close to closing a deal. However, doing so means taking on extra costs yourself. Be very cautious when doing this and make sure you don’t lose money by doing so. Such business will not be sustainable in the long-term.
Be realistic about the costs a project involves. As a contractor, some things to consider when calculating the final price are the materials needed, whether or not you need to rent equipment, and the extra fees for taxes, permits, and subcontracting (when there’s a need to bring in a third-party provider for a specific part of the project).
Monitor costs regularly. That way, you’ll be sure that you’re quoting your service accurately. The cost of materials’ can fluctuate significantly. Be transparent and talk to your client about anything that you think could impact the final quote at the beginning.
Make your quote straight to the point but impactful
Even if you’re using a quote template, don’t forget to ensure that your quote is to the point. Many people don’t like lengthy quotes, and some of them back out when receiving one as they are too complex to understand. That is not good for business. Keep your quotes short and punchy and in simple and easy to understand terms.
Personalization is crucial. 84% of consumers say that the most important factor for winning their business is treating them like a person instead of just another number in a company’s sales pipeline. (1)
In addition to personalizing a quote, it’s also essential to ensure that it reflects your brand. The goal is for your client to feel that the business relationship has begun immediately after viewing your quotation. It can be achieved by having your logo in the background. Don’t forget your digital signature, too!
Give clients options
It’s pretty normal to have some clients who are unsure about what they want for a project. That’s why in some cases it is good business practice to adopt an interactive quoting system providing options for your client to choose from. This way, prices adjust automatically based on the client’s choices. Not only does it help with your personalization efforts, but it also prevents your clients from contacting your competitors when looking for alternatives to meet their needs best.
Use specialist quoting software
Modern businesses need to constantly look for ways to innovate and enhance productivity if they are to compete, succeed and grow. Specialist quoting software can be used to give company’s like yours the edge in the market where the pace moves so quickly. (2)
Integrate this software with all your other business management systems and you have everything at your fingertips to streamline your systems and processes. Jobber, as mentioned above, is one such app that is revolutionizing how field services businesses are being able to do this, all in one centralized place.
Final Thoughts
Writing a quotation for your service might seem like a small part of your daily business operations. However, the truth is, its one of the most important things to get right in order to retain and grow your client base.
Adopt best practice by using a good quote template, understanding your clients’ needs, be realistic about costs, and make your quote to the point to win the deal. Giving clients options through quoting software systems can also be of great benefit to winning the business.
References:
- “What Are Customer Expectations, And How Have They Changed?”, Source: https://www.salesforce.com/resources/articles/customer-expectations/?sfdc-redirect=369
- “How Sales Quote Software Helps Small Businesses Compete”, Source: https://www.salesforce.com/products/cpq/resources/sales-quote-software-helps-small-businesses/
