How to write a contractor estimate that gets signed
A good estimate does two jobs. It tells the client exactly what they get for their money, and it protects you when the job changes. Most estimates that lose work fail at the first. Most that lose money fail at the second. Here is what goes on one and why.
What an estimate has to include
Every estimate, whatever the trade, needs these on it. Skip one and you will be answering questions instead of starting work.
- Your business name, phone, email and license number if your state issues one.
- The client's name, the job address and the date.
- A short description of the job in one or two sentences. "Replace rear deck, 12 by 16, pressure-treated frame with composite decking and rail."
- Line items: what you are doing, how much of it, and what each line costs. One line per piece of work or material, not one line for the whole job.
- Subtotal, tax if you charge it, and the total.
- The deposit you need to start and when the balance is due.
- How long the price is good for. Thirty days is normal. Material prices move.
- What is not included. Permits, haul-away, painting, anything the client might assume.
- A place to sign.
Line items: the part that wins or loses the job
A client comparing three estimates cannot tell which one is honest. They can tell which one they understand. The estimate with "Bathroom remodel, $14,500" loses to the one that lists demo, plumbing, tile, fixtures and paint with a number next to each, even when it is the same price.
Write each line as work, quantity and rate. "Install tile, 120 sq ft, $9/sq ft" says more than "Tile $1,080". It also makes the change order easy later: if the bathroom turns out to be 140 square feet, the client already knows what the extra 20 cost.
Group the lines under headings when the job has stages. Demo, rough-in, finish. It reads like a plan, and a plan is what they are buying.
Put the thing the client cares most about at the top. If they called about the leak, the first line fixes the leak.
Pricing the lines
Materials at what they cost you plus your markup, labor at your day or hourly rate times the time it actually takes, and a line for the things every job needs that nobody bids: dump runs, fuel, the trip back for a part. Contractors who leave that off pay for it out of the profit.
Do not price by feel. If you have done a similar job, use those numbers. If you have not, price the materials from the supply house that day, not from memory.
The deposit and the payment schedule
Say what you need to start and when the rest is due. For a small job, a deposit and the balance on completion. For a larger one, a deposit, a payment at a milestone and the balance at the end. Some states cap the deposit on home improvement work, so check yours before you write a number.
What to leave off
Your hourly rate as a bare number. Your cost of materials. Anything that invites the client to negotiate a line instead of the job. The estimate shows what each piece of work costs them, not what it costs you.
Send it the same day
The estimate that arrives that evening gets signed. The one that arrives Thursday competes with two others. Write it on your phone at the job, send it by text or email with a link they can sign on their screen, and follow up in two days if you have not heard back.
Common questions
Is an estimate a contract?
Once the client signs it and you both act on it, in most states it is treated as one. That is why the scope, the exclusions and the payment terms belong on it. A quote you never had signed is much harder to enforce.
Should I charge for estimates?
For most residential work, no. Clients expect a free estimate and your competitors give one. For work that takes real design time, a paid consultation credited against the job is fair and clients accept it when you say so up front.
How long should an estimate be valid?
Thirty days is standard. Shorter if material prices are moving, which they usually are. Write the date on it.