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Quotes: what they are, when to use them and how they differ from invoices Want that sale? Send a quote effortlessly!
Although a quote and an invoice are two separate things, both are used to help you make the sale and get paid. But to put it simply, the key difference is timing. A quote comes before any work is done, and an invoice comes after the thumbs-up has been given.
What is a quote? A quote is the best way to show your customers how much they would have to pay for your products or services before they have to commit to anything.
A quote should have enough information for your customers to understand what they would be getting, and how much they would need to pay, and even though a quote is an estimate, once a price is quoted, it shouldn't be changed. If you think the price may change, make sure to add terms that detail why prices could change. Quotes should contain the following pieces of information:
Your business details: Logo, name of your business, and contact detailsYour customer’s details Date of issue and date the quote expires: This lets the client know there’s a limited amount of time to accept or decline your quote.Line items for requested products and services: A quote is more effective if you break it down so they see exactly what they’re getting.Pricing for any additional materials, labour, taxes, and any relevant discountsTerms and Conditions
To Quote or not to quote? That is the real question Simple, it’s good business practice! A quote isn’t a done deal, your customer has not committed yet - and that’s ok, neither have you at this point. If you have sent a quote, you and your customer will both be on the same page, there is no expectation or pressure of payment from both sides.
This protects you if the customer decides to ghost you after the quote was sent, and your customer if they realise they can’t afford it or need to look for other options. It will also help you avoid chasing down customers for overdue payments on invoices, deleting and editing invoices over and over again (which isn’t ideal) and will keep your books clean and accurate. So when in doubt, quote it out! 😜
When to send a quote Unlike a shop where prices are on display, your customer needs to figure out how much a thing or service is going to cost them. A quote would normally be sent when a customer makes an inquiry or if they want to find out more about a product or service you offer.
The basic rule of thumb is if you are not sure a customer is ready to commit to the sale - send a quote NOT an invoice. It’s always a good idea to send a quote as soon as your customer asks for one. You don’t want your customers shopping around while they wait for the quote, but be sure you give yourself time to make sure the quote is correct and you can commit to the price. So double-check your costs and look out for any spelling errors before you hit send.
What to do when your quote is accepted Once a customer receives your quote, they will either be happy and accept it or will decline it and other times they may just ghost you, annoying, but at least it’s just a quote right?
If they accept your quote (whoop-whoop, hooray 🥳) you can now send them the final invoice that confirms the sale and allows them to pay.
In stub, a customer can hit “accept” straight from the quote you sent them (I know, so cool). And once we notify you that they have accepted, all you will need to do is go and convert that quote into an invoice and send it off so you can get paid.