Arkansas HVACR NewsMagazine February 2018

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closer than if you presented another type of offer. “You quoted me $800,” is a different expectation from your clients than an estimate. Quotes are best for those easily quantifiable projects, whether from your years of experience, or because a project has few variables. If you offer a flat rate service, or you’re selling a product with a defined installation cost, quotes might be the right choice. Avoid quotes if you don’t expect your final tally to be very close to your beginning offer. Think of your quote as a defined scoped based on quantifiable data. Estimates – A Variable Price Because of Unknowns Not able to offer that kind of firm price? Estimates may be the solution when the customer just wants a ballpark figure. Often, they expect the project to have surprises, and are less attached to the final price being tight on the margins. You should still be accurate – forty percent overruns don’t make for pleasant results – or reviews. Offer estimates for projects where you want to account for variables. If your estimate only covers the normal scope of work, then you can offer extras or upgrades in addition. Is the estimate too high? A customer feels more confident in negotiating based on options to get the project in line with their expectations. That negotiation can win you projects that a quote can’t. If precision isn’t key to getting the job done, consider the power of the estimate – and expect a bit more give and take to seal the deal. Bid – Responding to Specifications

Line by line, detailed expectations – those are the power of bids. Often used in government or large corporate projects, bids have a different niche for your business than either quotes or estimates. Expect more rules and regulations as to how you submit your information. With the bidding process, the customer is the one setting the expectations and requirements. And expect competition, too. While you might be the only company submitting a quote, you’ll likely be one of at least two or three bids. These customers want to compare your bottom line. They also may be looking at your labor costs, quality or price on materials against the others bidding. Once you submit bids, there’s little room to negotiate, unlike estimates. It can be a longer process, as well, especially for larger government entities. If you understand your competition well, and the expectation of those requesting bids, this can be an excellent process of taking your business to the next level. Like quotes, these projects are fully defined in scope. Proposal – A Chance to Differentiate Your proposal can be a hybrid of all three of the previous methods. Proposals usually lend themselves to projects where you have multiple options or solutions for the client. You can have a proposal with multiple components where one part can be an estimate and another part a quote. Think of a proposal as your comprehensive package of your offer. Complicated projects benefit well from this approach. You can also