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January 24, 2024
Updated: January 30, 2024

Quote Estimate or Indicator? How to label your pricing tool

A simple guide to labeling your online calculator for transparency and legal considerations. Discover and take advantage of the benefits of each approach.

Want to avoid misunderstandings, confusion, and even possible legal tangles?

Yep. We all do. When providing a pricing calculator on your website, distinguishing whether it's a quote, an estimate, or an indicator will provide clarity to your customers and build trust in your brand.

You are most likely well aware of the quote estimate situation in your industry. However, there are advantages to each when it comes to automating your processes online.

This article outlines the difference between the two and determines how to make the most of each approach while ensuring your legal bases are covered.

Terminology: Quote vs. Estimate

Before we dive into the specifics, let's establish a clear understanding of the terms:

  • Quote: A quote is a formal offer to provide a product or service at a fixed price. When a customer accepts a quote, it becomes a legally binding agreement, and the price is not subject to change (unless explicitly stated).

  • Estimate: An estimate, on the other hand, is a preliminary approximation of the cost of goods or services. It is not a final offer, and the price may vary based on various factors, such as additional work, scope changes, or fluctuating costs.

  • Indicator. A price indicator for this purpose is much the same as an estimate. It serves as a general guide or reference point for the potential cost of goods or services.

How to label your online quote calculator

Let's explore the key factors that help you determine whether your online calculator should be labeled as a quote or an estimate:

A Quote has Pricing Certainty

If your calculator provides a fixed, unchanging price you will charge for your products or services, it's a quote. Quotes are suitable when you can commit to an exact price without adjustments.

The advantage of providing a quote on your website is that you can automate your quote to booking process. This provides convenience to your customers, locks in business before competitors, and saves you the time and stress of managing a manual system.

For example - if you have a screen printing price quote calculator on your website that calculates the exact price of your site visitors' order, they can select what they want, and if they are happy with the price, move ahead with the purchase without having to contact you for confirmation.

If you have a service based business like photographers and musicians you can do the same by:

1. Creating a set of fixed prices or packages and add-on services.

2. Making these available on your website in a Quote calculator.

3. Connecting this to your booking system.

This creates an automated lead to booking system that's ready to scale. Read this article for a more in-depth look at price quoting

examples

Online quote calculator

example

An Estimate is Flexible

If the price generated by your calculator is subject to change based on variable costs, it's more in line with an estimate. Estimates give a rough idea of pricing and are appropriate when the final cost is uncertain or may fluctuate.

Examples of these are:

  • Building cost calculators created to give visitors a rough idea of prices before they move ahead with getting a fixed price quote.

  • Carpet cleaning estimators where more detail needs to be collected by a site visit or sales call.

  • Solar panel price indicators where a technician will need to visit the job site to ascertain viability and the final costs involved in the project before a quote can be given.

The benefit of estimates is that they can be used to qualify leads before you spend precious time creating detailed quotes. This is great for businesses where quoting is time-consuming and detailed. The building industry, for example.

An estimate calculator on your website allows you to qualify and collect quality leads. Providing relevant information on your estimate allows you to inform and educate prospects about your product, making your sales team's job much easier.

examples

Carpet cleaning estimate calculator

example

Automate your processes

Incorporating online automated calculators for quotes and estimates will significantly streamline your business processes, allowing you more time to focus on growth and client engagement. It's a smart investment in your business's operational efficiency and professionalism.

Advantages of Online Automated Quotes/Estimates:

  1. Time-Saving: Automated systems generate quotes or estimates instantly. It's like having a personal assistant dedicated to crunching numbers 24/7.

  2. Accuracy: Minimize human error. Ensuring your quotes and estimates are precise and reliable.

  3. Consistency: Every quote or estimate follows the same format and structure, presenting your business in a professional and organized manner.

  4. Customization: Customize pricing, branding, and products or services to suit your business needs.

  5. Record-Keeping: Track and manage your quotes and estimates easily.

It's important to consider the legal implications in your jurisdiction. In most regions, quotes are legally binding once accepted by the customer, while estimates are not. Be aware of the legal requirements in your state or country that apply to your pricing tool.

Ensure your pricing tool communicates clearly, whether it's providing a fixed price (quote) or a preliminary cost approximation (estimate or indication). Transparency builds trust and avoids misunderstandings.

ConvertCalculator provides the flexibility to create pricing tools tailored to your specific business. Whether you create a quote calculator or an estimate generator, it's important to communicate which one it is with correct labeling.

FAQ

Is a quote legally binding once accepted?

Once a quote is accepted, it becomes legally binding. This acceptance turns the quote into a contract, obligating you to deliver as per the agreed terms, which include all the costs associated with the product or service.

Once agreed upon, any changes to the terms of the quote, especially regarding all the costs and fixed costs, must be mutually agreed upon, and the changes must be documented in writing.

Is a quote a fixed price?

Yes. Once given and accepted, a quote should not change, providing the exact final costs of the product or service.

Do estimates and quotes both need dates?

Yes, including dates on quotes and estimates is important for validity and record-keeping. However, an online calculator is different in that visitors use the calculator to get a price, before moving to the next step.

It is only when they move to the next step that you need to provide a date on the quote or estimate they download or that you email them as part of the process.

Should I always provide a written estimate or quote?

Once you set up your online calculator, you don't need to provide written quotes or estimates immediately. Visitors will be able to see their detailed quote, on your website. At this point, it is not a contractual agreement.

You can gather visitors' information from your quote form and email them their price quote or estimate, encompassing all the costs, as a follow-up. This follow-up will contain the written quote or estimate.

Do estimates and quotes both need dates?

You won't need to put a date on your website quote or estimate calculator. But if you email out or have a download available from the form, this should have a date.

Including the date of issue and the expiry date of the quote is good practice and will cover you in case of changes in your pricing.

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