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Handling Customer Estimates as a Contractor

FieldPulse | February 7, 2017

iPad invoiceIf there’s one thing that can create tension in a contractor-client relationship, it’s the estimate. When you finally get to it, it can be the make or break for your deal. How do you create and present an estimate or proposal that wins the deal without compromising your price or offering? Make sure your estimates provide the necessary details, have clarity and transparency, and set expectations up front.

The last thing a homeowner wants to hear about is uncertainty in the final price. That type of uncertainty can cause some clients to back out of a deal. It doesn’t matter that estimates are called ‘estimates.’ The possibility of the final price tag being higher than anticipated scares the daylights out of homeowners. Customers expect your estimate to be a quote or proposal for a set scope of work, but setting the right expectations can alleviate any issues with scope changes.

Presenting the Estimate with Clarity

The estimate should be clear and precise. If your estimate is detailed and articulated with clarity, the homeowner is more likely to feel at ease regardless of where the number lands as they can see the materials and labor that factor into the pricing. So what does a precise estimate look like from the client’s point of view?

While you might not want to bog them down the with the details of each line item, providing line items for each component with price, quantity, and tax shows that you’re not just pulling a number out of thin air. It gives transparency to your process that is lost when they’re just presented a total price. Many parts of your job are ‘behind the scenes.’ When a customer looks at a job, they don’t know everything that goes into it. Your estimate is a chance to show those behind the scene costs that go into your final price.

Setting Expectations of the Estimate

Now that you have the details worked out, it’s time to talk about customer expectations. Since there’s good chance that your estimate may very well be a bid, how you explain your methodology could be the determining factor in you landing project. Below are some questions to consider:

  • How accurate is your estimate?
  • Are there external factors that may change the scope of work and the price?
  • How can you differentiate your approach from your competitors and why is it smarter?
  • Why are you using a particular brand of materials?
  • Can you explain your timeline and projected completion date?
  • What are the payment terms? What are the penalties for not making payment?

Your goal should be to answer all possible questions they may have before they even have a chance to ask it. You want to appear to be prepared, experienced, and ready for anything.

Is Your Estimate Easily Accessible?

If you’ve been in contracting for very long, you know your customer will only remember a small fraction of what was said in your last meeting. This can come back to haunt you in those moments when they begin questioning the terms.

Keeping digital copies of your estimates and sending them via email to your customers not only gives them an easy way to find your estimates, but a documented exchange in case of a misunderstanding. When it comes to payment disputes, being able to revert to signed and emailed copies of an estimate or invoice can go a long way.

Contractor Estimating App

Thankfully, we live in an age where technology gives everyone access to critical information. A contractor estimating app can not only create beautiful, detailed estimates right in front of the customer, but it also lets you stay on top of open estimates and invoices to make sure you follow up on opportunities and get paid.

Using contractor estimating software can also do much of the work for you and much faster. It stores your invoice line items with their prices, quantities, and tax applied so you can quickly insert them into your invoices without re-writing them each time. All of the math and tax is automatically calculated for you. Need to make an edit? Simply make a change in the app instead of starting from scratch. You can generate a PDF of the invoice with your logo on the spot, take signature from your customer, and email the estimate PDF to them. They are as precise, detailed, and accurate as you want them to be. Using an app will cut down your estimate time significantly and keep your more organized.

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