Last editedJul 20213 min read
When you’re competing with other businesses for a new contract, offering a competitive price quote is one way to seal the deal. Yet learning how to write a quote is an essential skill for any small business, whether or not you’re trying to land new clients. Keep reading for a rundown of the price quote basics.
What are price quotes?
A price quote, also called a quotation, is a formal document outlining the price of a particular good, service, or project. It should include a breakdown of all costs involved so that the customer knows exactly what they’ll need to pay when the product is delivered.
If you look at various quote examples or templates, you’ll see that formats can vary. However, generally a price quote will be printed on company letterhead, offering an itemised list of all prices associated with the service.
Small business quotes are often confused with business proposals, but these two terms hold different meanings. A proposal is far more detailed than a quote, providing a full explanation of how your business will deliver the service or product. By contrast, a quote merely outlines price.
Another term that’s frequently confused with quotes are estimates. Estimates give a rough guideline of cost, usually offered as the first point of contact with a new client or customer. When you’re ready to give a more formal, accurate fixed price, you should deliver a quote instead. A quote is legally binding as a contract, while an estimate gives a general idea of pricing.
Components of small business quotes
What should a good quote example look like? When writing up any price quote, you should think about including the following basic components:
1. Business contact details
You should include all relevant contact information at the top of the document. This includes things like your business name, address, email address, website, and phone number, as well as your client’s name and title.
2. Quote number
As with invoices, it’s easier to keep track of your quotes with a unique number for retrieval in your system. Most accounting software comes with a free quote template that will automatically generate this on your behalf.
3. Dates of issue and expiration
The quote should show the date of issue, along with a date of expiration. This lets the customer know that there’s a timeframe for which the quoted price is valid. After the expiration date, they’ll need to request a new quote.
4. Itemised list of prices
The most important component for any small business quotes is the prices themselves. The bulk of your quote should be a pricing table listing each product, service, or fee associated with the job. List each in a comprehensive list including quantity, unit price, and final price, as well as any taxes if applicable.
5. Terms and conditions
Are there any payment terms that your customer should be aware of? Perhaps there are extra fees involved for optional parts of the service. These should all be clearly outlined in a terms and conditions section.
Finally, if you have any other details that are relevant to the price quote these can be included in a final notes section.
How to write a quote
You can find a free quote template online or use accounting software to get started, keeping the components above in mind.
When looking at how to write a quote, remember that this is also your chance to sell your business’s services to a new customer. Are there branding elements you could incorporate into the template? Make it stand out with attractive branding and a clean layout to grab the client’s attention. It might be helpful to look at quote examples from competitors to see what’s standard in your own industry.
Once you’ve done your research and found an applicable template, the next step is to fill it in section by section according to the components listed above.
Company name and contact information
Customer contact information
Pricing table with itemised costs
Terms and conditions
Additional notes
There’s no single quotation format that you must follow, but most templates tend to use a structure like the following:
Header at the top with contact details and quotation number
Body with the pricing table and proposal of goods or services
Footer at the bottom with total pricing, tax amounts, and call to action
A good final rule of thumb is to keep value at the forefront of your quote. As you draw up your quotation, think about how each element will add value to the customer and help you land your contract. No matter which template or quotation format is used, the prices given should be clearly defined.
We can help
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