The risks of quoting too high
THERE ARE PROS AND CONS to charging a day rate. But part of charging the right day rate involves quoting jobs correctly.
Part of charging the right day rate involves quoting jobs correctly.
And what are the requirements for quoting a job properly? You need solid experience in the field you work in, and the ability to evaluate a job thoroughly to ensure you’ve accounted for all the things could crop up once work commences.
Beware of over-quoting
Yes it is important to take into account things that could come up after you start a job that might require additional materials and time. This said, don’t factor them into your quote unless you’re reasonably sure they could occur. If you do, you risk your quote being too high.
Providing someone with an unnecessarily high quote reduces the likelihood that they’ll accept it, which only just ends up costing you money — you spent time working on the quote, after all.
Quote what the market will bear
If you’re an experienced builder, your hourly rate is going to be much higher than a labourer’s, who is paid between $20 and $30 an hour. If you’re quoting for a job that requires substantial digging, which is time-consuming, but ultimately, unskilled work, subcontract that out to a labourer, to keep the price to your client down.
Again, you’re unlikely to have your quote accepted if you’re quoting to do all of the work yourself at your regular rate. Most people will get more than one quote, so if you’re quoting above what the market rate is for a given job, you probably won’t get the work.
Make your quote easy to accept
Use electronic accounting software like Xero, MYOB or QuickBooks to create estimates that you can email to your clients while you’re still talking to them. This means they’ll be able to ask you any questions about the quote, and possibly even accept it on the spot.
Use electronic accounting software like Xero, MYOB or QuickBooks to create estimates that you can email to your clients while you’re still talking to them.
This will reduce the amount of estimates you have to spend time following up on, and also help you to better structure your work as you’ll have a more steady flow of work.
Maybe you’re a sole trader, tradesperson or small business owner who would like help figuring out the right places to advertise your business online.
Contact the team at Virion for more information about our content marketing services to suit your budget.
Do you like what you've read? Subscribe below to receive our research blog posts in your email when they're published.