A quotation is a summary of the cost of hiring a business along with the amount of work the business needs to do for its client. A quotation Template is the pre-contrived format into which a business can place its information. Usually, a customer has a budget for the work it wants to be done. The quotation provides the customer that a business’s rates and, therefore, simplifies the process of choosing a business to hire.
Goods and services are definitely offered at a price. It is important that these prices be made known to the potential buyers beforehand to allow them to make more informed decisions thereafter. The quotation is the business document that makes the prices known to the parties of interest.
But just what is it? How may it be drafted? Is it the same as an invoice? Is it legally binding? What are some of the contents that the document has to possess? Well, we devote the entire length and breadth of this article to discuss these, and indeed, so much more.
A quotation, for a start, is a formal business statement that sets out the estimated costs for particular services or jobs. The prices stated are not final and are hence subject to change or revision. It is the prices that are showcased on the statement that a potential buyer of the commodities uses to budget prior to placing an order.
Elements of a Quotation
A standard quotation has to contain some items and features. Below are some of the vital pieces of information that must never miss out on a quotation:
All quotations must by law showcase the names of the businesses that owe the money that is being asked for. Accompanying these are the contact details, business numbers, and other information that prove the legality of your business.
Grand Total Costs of the Project
Here, you show the total cost of the project you have undertaken for which you want to be paid. It is good to be detailed and to the point. Highlight any aspects of the project that the cost is or will not be applicable to.
In the spirit of being detailed, you also want to break the costs down to their logical ends. By breakdown, we mean matching each phase of the project or commodity with the corresponding individual cost.
Variations in Costing
Costings are never fixed all the while. Some vary significantly with the production, transportation, weather, climate, and other key parameters. You have to specify these variations to the latter also for the avoidance of doubt.
Provisions for Revisions
It is not uncommon for the costs and the terms that underlie them to be revised from time to time. Yet again, you have to make these provisions known and the details that surround the same. That is to lay a firm foundation for future dispute resolution.
Terms of References for Payments
Each payment is subject to some terms of references. It is mandatory that you specify and make known these terms of references yet again to avoid some doubts that may generally arise in the course of executing the said payments.
As is the norm with any other professional document, the quotations are also subject to the expiry. You have to specify when exactly the said document shall expire in its current form. If and when there is room for extension of the expiry, you also have to explain it.
Acceptance Signature of Clients
The various parties to the dispute have to append their signatures on the document. It is the signature that gives the document the official character and acceptance it requires to fulfill its role exceptionally well. Accompany the signatures with the dates when the said are appended.
Mode of Payments
How will the payments be executed if and when the time to do so ripens? For the avoidance of doubt, you have to demonstrate clearly the method that shall be used to execute the payments thereof.
Quotation Templates are simple and there are many types. Here are some.
Sales quotation template
Sales Quotation Templates can carry the cost of hiring a business. The cost, even with the sales templates, may be difficult to add up. That’s because a business’s full services, from being friendly to handing in the finished job, don’t often have an exact price. Despite this, you can check out some free Sales Quotation Templates here.
Price Quotation Template
Price Quotation Templates help businesses create price quotations, which focus on the price of a business’s services and goods. Since the price may change, price quotations must have a time limit. See how it’s done in the Price Quotation Templates below.
Insurance Quotation Template
An Insurance Quotation Template can hold the cost of the insurance premium and overall insurance costs for a specific customer. As the customer’s needs change, costs change. That is, the final cost may differ from the quote cost because the customer’s final mindset may differ from their quote mindset. Insurance Quotation Templates aren’t easy to make but are to fill, as you can see below.
Maintenance Quotation Template
Maintenance Quote Templates are made to calculate the cost and time taken to keep equipment in working condition. In the technological age, this is important because most work is done through external equipment, computers, tablets, and so on. You can look through some of the Maintenance Quote Templates to see how they’re done.
Product Quotation Template
A Product Quotation Template, as referenced in its name, is a template for soon-to-be-released products. They provide ways to create quotes with intricate details about the products such as prices, quality, makeup, expiration dates, aesthetics, and so on. This template is set between dates because each fresh product has different features. When the aged templates are revealed to potential clients, they show, as aforementioned, the business’s professionalism and work ethic. Product Quotation Templates are easy to use, especially if you know Microsoft Word or Excel well, as seen in the free templates below.
Hotel Quotation Template
A template that can have the cost of services, food, rooms, and such is a Hotel Quote Template. Clients usually request these to compare what they can have with what they have. They’re simple and quick to read. You only have to check out a few free Hotel Quote Templates here to see what they’re really like.
Computer Service Quotation Template
A Computer Service Quotation Template, as evidenced below, can have the cost of computer repairs and maintenance. Seeing a computer service quote, made easy to fill out by the Computer Service Quotation Templates, is essential for nearly every customer because nearly every customer uses computers.
Medical Quotation Template
The templates that can have the cost of medical care corresponding to each illness are Medical Quotation templates. With Medical Quotation Templates businesses can form medical quotes as easy as shown below.
Stock Quotation Template
Stock Quote Templates can hold asking, bidding, and last trading prices, along with a certain day’s volume. Web sites easily dole out stock quotes for those wishing to buy their stock. Stock Quotation Templates are very simple to use. Just check out the ones here.
Service Quotation Template
A service quote gives clients a summary of the cost of a business’s services. Service quotation templates ease creating this quote. Here are some Service Quotation Templates.
Hourly Price Quotation Template
One of a business’s greatest challenges is deciding whether to charge a fixed rate for services or by the hour. The hourly quotation is for the business that chooses the latter option. And that business doesn’t need to worry because they’ll have the Hourly Quotation Template. The Hourly Quotation Template is especially helpful for small businesses. Only look at the free ones below so you yourself can see how simple one of these templates is.
General Quotation Template
A general quote gives the customer an overview of all the services and products the business offers, and a General Quotation Template simplifies the process of creating a general quote. The General Quotation Template is the most basic and probably one of the most important of the templates because it’s the first introduction the customer has to the business. Some free, simple-to-fill-in templates are below.
Download our free and customized templates from here:
Templates by quotation type:
Quotation or estimate templates:
Quotation format templates:
Benefits of Quotation
A quotation brings about many benefits to the two main parties concerned. These are the sellers and the buyers respectively. We examine these benefits here below:
To the Seller:
- Gives a clear picture of the costs and their associated breakdowns
- Sees to it that the buyer and the seller ‘read from the same page’
- Eliminates any ambiguities that may arise in the course of closing a sale
- Cuts down the negotiation times for both parties
- Acts as a basis for future references and litigations
To the Buyer:
- Allows for simplified comparisons of offers from many potential sellers
- Leads to proper and expedited decision making by the buyer
- Gives a firm basis from which to argue or bargain for a great deal
- Reduces the waiting times for the execution of sales
- Expedites the contacts and follow-up of deals
Difference between an Invoice and Quotation
Many people have the tendency to confuse an invoice and a quotation. In fact, many people use these terms interchangeably yet they are not. Below are some of the key differences between these two:
Time of Issuance
A quotation is generally issued before the work is done or the goods and services are delivered to the targeted audience. The invoice, on the other hand, is issued after the task has been accomplished or the goods and services have been delivered to the rightful party.
The quotation is not legally binding and is often subject to negotiations, bargains, and alterations. An invoice, on the other hand, is legally binding, is final, and is hence non-negotiable or subject to any alterations. Any dispute that arises from it may be litigated in a court of law.
Generally, a quotation contains the sum total list of goods and services that the business concerned has in stock plus the amounts of money for which they are provided. An invoice, however, contains only those goods and services that have been rendered or catered for and have yet to be paid for.
The purpose of a quotation is to give the buyer a rough clue of the amount of money he is to part with to be able to accrue the desired goods and services. It is not final and is hence subject to some alterations. The invoice, however, serves to demand money for the services already rendered.
Mode of Issuance
To issue a quotation, you may either choose to do so verbally or in writing. The exact choice you opt for is entirely up to you. Invoices though have to be issued out strictly in the form of writing, No verbal issuance may be tolerated at all.
Tips when writing a quotation
Being professional and highly important in the life of a business, the quotation has to be drafted with due diligence and utmost professionalism. That can only happen if you adhere to some hot tips which we explain here below:
- Put it in the form of writing. It is in this way that it obtains and assumes a professional look. Verbal communications, though admissible, are highly prohibited.
- Draft it against a company letterhead, use a formal tone, and start with it an awesome greeting. The combinations of all these give off some formal tones and characters.
- Make your pricing your competitive in order to give you some edge over and above the other players in the market place at the same time.
- Maintain some honesty by quoting only those things that you are able to offer. Do not overestimate your capacity to handle and tackle tasks as that may cast you in a bad light with your clients later.
- Make some follow-ups after submitting the same. That way, you will stand ahead of the pack and also prove to the potential buyers that you are indeed serious and mean well for the project.
- Indicate the risks and other unique provisions clearly. It is important that you do so for the sake of preventing any ambiguities from arising.
- Seek recommendations from lawyers and the local chambers of commerce offices. The way in which this document is drafted has the ability to make or break the situation. You do not want unnecessary litigations to arise later.
We bring our look into the quotations there. The pieces of information we have provided are definitely enough to be able to get you started out well. With that in mind, we now expect you to do a good job of drafting it if and when they need to do so arises. Why don’t you soldier on now with confidence?