Quote, Estimate, or Bid?

A common question I come across, especially in the residential space, is, ‘What is the difference between a Quote, an Estimate, and a Bid?’
Well here’s your answer:

A Quote is a a rough price based on the information given, usually without a site visit. Think of this as the ‘bar chat’.

An Estimate is a detailed breakdown of what the project should cost based on the information given in the Scope of Work, or by the Building Plans, and information ascertained during the site walk.
Think of this as a sit down meeting in the place where the work gets done.

A Bid is a single number given as part of an agreement that has a specific Scope of Work; ‘I will do X, Y, and Z for N dollars’ – anything not covered in that Scope is NOT included.
Think of this as a sales offer at a car dealership.

Some examples:

  1. The back deck:
    Customer wants some numbers for building a deck in their backyard, has a couple pictures, and wants a deck that ‘goes well with the house’.
    • A Quote would be, ‘About $10,000, about a week, I could put this on my calendar in about 8 weeks’.
      Rough pricing at best, not much in the way of details, and subject to change based on the details at the site walk.
    • An Estimate would be, ‘$6,000 for materials, $4,000 for labor, 10 days total for the job. We’re going to clear the space of debris, dig, set, and pour footers, then build a deck 40′ wide by 20’ deep, with two steps on each of three sides, and vertical railings topped with handrail on three sides.
      The deck will be free standing, not attached to the house, but the gap will be less than two inches all the way across, and covered with a deck board.
      For an additional $1,000, we’ll also take off the top layer of grass under the deck, and lay down weed block fabric before we build the deck.
      Much more detail, quite specific, but still subject to change as it is an Estimate, not a fixed price.
    • A Bid is a fixed price for the Scope of Work, and, in this case, there are not enough details to provide a Bid.
      A savvy and experienced contractor would likely size it all up, then bid quite high, submitting a bid of:
      We will set and build you a deck 20′ x 40′ using proper wood materials and steel fasteners, with steps on three sides, NOT attached to the house, with proper railing and decking to meet code. It will be done within 30 days of start date, and we will charge you $15,000 fixed price.
      A Bid is essentially a box; anything IN the box is covered, anything NOT in the box is not covered.

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