An estimate is one of the most important steps in the sale process. With the presentation of an estimate, you can make or break a deal with a prospective customer. That’s why it’s so important to educate your customer on the overall estimate process and what to expect.
As a contractor, you need to look at the estimate from the customer’s point of view. Once you give them the information they need, they will be in a better position to choose your services.
Imagine you were a customer, and one contractor came to you and said, “Choose my services. I’ll get the job done as fast as possible for as little money as possible, and you won’t have a problem with this breaking again for a long time.”
Another contractor came to you and said, “I can complete the job in 5 hours for $500. I guarantee the repair for 5 years.” He then goes on to explain what he plans to do and how he is dividing his costs between materials and labor.
Which contractor would you choose?
The answer is easy! The contractor with clear, competitive, and specific terms will always win over a contractor that offers vague terms.
How to Help a Customer Understand the Estimate Process
As a contractor, you have to make sure that your estimates are clear and spell out the exact results that you plan to achieve for your customers.
Customers often know their requirements, but they might not know the price they are willing to pay to fulfill those requirements. As a contractor, it’s your task to explain to potential customers the value you bring to their project.
How Do You Explain Value to Customers?
As a contractor, you have to be on the same page as your customers. This can help to develop a shared understanding of the value you bring to them. You can break down value into the following parts:
- Technical benefits
- Economic benefits
- Service benefits
- Social benefits
In essence, an estimate should explain to the customer how they can achieve one or more of these benefits by hiring your services.
What Does an Estimate Contain?
An estimate should clearly present all the information a customer is looking for. Here are some points you should consider including in your estimate along with other information.
- Work Involved: Mention in detail the work that is required of you and your team. A detailed explanation will prevent any confusion or hassles once you complete the job.
- Job Description: Describe the job as mentioned by the customer. Also, offer your observations or inputs regarding the nature of the job.
- Total Cost: State the total cost of the job, including any taxes. You can further break down the cost in detail so that customers have an exact idea of what services they are paying for.
- Terms: Clarify your working terms in this section. Write down the duration of the estimate, the expected date of the final payment, and if you need a deposit before starting the work.
- Contact Information: A simple phone number is not enough information. List your email, office phone, and personal cell phone number so that your customer can reach you when they need to.
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How to Compare Estimates from Different Companies
Every estimate is different because no two contractors will approach a job in the same way. If you are a customer, you would probably choose the estimate that will get the job done most quickly and efficiently. Here are some factors most people look for in an estimate when comparing two or more contractors.
- Project scope
- Project duration
- Terms of payment
- Material costs
- Labor costs
- Permit costs
All of these might not apply to your business, but try to include as much information as possible to help your potential customer make an informed decision about which company to hire. If possible, ask them questions about your estimate to see if they understand it and see your terms as reasonable. Opening the door to clarifying your estimate can give you more opportunities to talk to the customer and close the deal.
How to Make Sure Your Estimate Stands Out
The presentation of an estimate can make or break a deal with a customer. The idea is to present the information the customer is looking for in such a way that you close the deal. Here are some estimate pitch techniques that will make sure your estimate stands out and gets noticed by the customer.
Win The Customer’s Trust
Your customer will have all kinds of pricing options, but if you manage to convince the customer that you are the most trustworthy and credible contractor, they are more likely to choose you over other options.
Be honest and friendly about your offerings, and maintain clarity about the services that you plan to offer.
Get Information from the Customer
For most customers, money is secondary when it comes to getting a job done in the best manner possible. They are looking for a trustworthy contractor that can deliver the most efficient services.
Ask the customer about their needs and requirements from the project and pitch your services as solutions to their problems. This will help you to develop a good rapport from the start.
A sense of understanding of the customer’s needs can help you close the deal without having to undercut your competition.
Provide Pricing Options
You can strengthen your relationship with your customer by offering them pricing options that meet their needs. At most, present two or three different options for for making payments.
Also consider offering different priced options. Gauge the requirements of the customer and provide them with different solutions to their problems at different price points.
By giving the customer options, you can help them to feel in control of the deal. They are more likely to trust you and hire your services as a result.
Promise Within Your Capabilities
Most contractors make the mistake of promising the world to the customers. When they can’t deliver on those promises, it can ruin a project. And it can ruin any possibility of future business.
Make promises to your customer that you are absolutely sure you can deliver within the scope of the project.
Provide customer service by taking feedback from the customer and improving your services as a result of their feedback. This can help you in getting more business and referrals from your customers.
Help Your Customer Understand The Estimate Process
Writing an estimate for a prospective customer is a skill that can make or break a business. By following the guidelines offered in this article, you can improve this skill and increase the number of leads you close. Remember, when writing an estimate, think from the customer’s point of view and be honest in all that you can offer to the customer.