What is a quotation?

Anyone who sells something starts with a proposal. A cleaning company, a wholesaler or a small manufacturer sends the customer a price for a specific delivery or job. That proposal is the quotation.

A good quotation says exactly what is included and what is not, what the price is, what the delivery or execution looks like, until when the proposal stands and which terms apply. The more precise it is, the less argument afterwards. Prices should ideally come from your price list or from agreements with that customer.

Once the customer accepts, you send an order confirmation and the order moves into execution. If the quotation sits apart from everything else, someone has to retype it, and differences creep in between what was promised and what is invoiced.

The problems are familiar. Quotations live in loose Word or Excel files, nobody knows which version is the latest, and there is no overview of what is still open. Follow-up is missed: a proposal the customer never heard about again simply sits there and never becomes an order.

For work made up of hours and materials, the quotation is also the starting point of your post-calculation. What you estimated beforehand you compare later with what it really cost. That makes the next quotation better.

Agree internally, too, who may issue a quotation and up to what discount. That way the price the customer sees is a price you stand behind. Record when a proposal lapses, too, so that an old price is not claimed again long afterwards.