Handbook / Pricing your work

How to quote a job: estimate time, costs and risk, then present it well

A good quote wins work at a price that pays you properly. A bad one either loses the job or wins it at a loss. Quoting well is a skill: understanding the job, estimating honestly, adding what you need to stay in business, and presenting it so the client can say yes.

1. Understand the job

Ask questions before you put a number on anything:

• What exactly needs to be done, and what does "done" look like?
• What is the deadline, and is it fixed?
• What will the client provide, such as access, materials or content?
• Are there constraints, such as working hours, site access or approvals?
• Who makes the decision, and what is their budget range?

For physical work, a site visit or photos help. For creative or professional work, a discovery call and a short questionnaire do the same.

2. Break it into tasks

List every stage of the work: preparation, travel, the main tasks, revisions or rework, clean-up, admin and handover. Small tasks add up and are the first to be forgotten.

3. Estimate time

Estimate hours for each task based on similar past jobs. If you have no history, estimate generously and track actual time. Comparing estimated and actual hours after every job is the single best way to improve your quoting.

4. Estimate materials and costs

Include:

• materials and supplies, with any waste allowance
• equipment hire
• subcontractors
• travel, parking and delivery
• permits or fees
• software or stock assets bought for the job

5. Add overhead and profit

Your price must cover more than the job's direct costs. Overhead includes insurance, tools, vehicle, software, marketing, accounting and unpaid admin time. Spreading those costs over your billable hours gives you an hourly cost; see hourly rate. Remember that self-employment tax and income tax come out of what you earn, so a price that only covers costs leaves you short.

Then add a profit margin. Profit is what lets the business build reserves, invest and survive slow periods.

6. Add contingency for uncertainty

Jobs with unknowns, such as old buildings, unclear requirements or new types of work, deserve a contingency. Either build it into the price, state an allowance for specific risks, or price the work in stages: a paid first phase that answers the unknowns, then a quote for the rest.

7. Check against the market

Compare your total with what similar businesses charge and with the value to the client. If your price is far above the market, look for ways to reduce scope or explain the difference. If it is far below, you may be underpricing. See how to price services.

8. Write the quote

A clear written quote includes:

• your business name and contact details
• client name and job reference
• scope: what is included, in plain language
• exclusions: what is not included
• assumptions: for example, access or materials provided by the client
• timeline
• price, with any options listed separately
• payment terms, including any deposit
• expiry date for the quote
• how to accept

For larger projects, a statement of work or contract should follow. An agreement generally becomes binding when both sides exchange something of value, so make sure the accepted quote matches the work you plan to do.

9. Present and follow up

Send the quote promptly, while the client is still interested. Offer a short call to walk through it. If you have not heard back in a few days, follow up politely; see following up with a client.

Offering options

Two or three options, such as basic, standard and premium, let clients choose the level of service rather than whether to hire you. Keep each option clearly defined.

When the job changes

If the client asks for extra work after accepting, quote the change separately before doing it. The guide to scope creep has wording.

Learning from lost quotes

When a client says no, ask politely why. Price, timing, scope or fit all tell you something. Keep a simple record of quotes won and lost, with the reasons, and review it every few months.

Understand the job, break it into tasks, estimate time and materials honestly, add overhead, contingency and profit, write a clear quote with exclusions and an expiry date, and track actual against estimate.