Estimate vs quote vs bid
| Document | What it means | Use it when |
|---|---|---|
| Estimate | Your best calculation; the final price can change if the scope or conditions change | Most residential repair and remodel work |
| Quote | A fixed price for a clearly defined scope | The scope is small and fully known |
| Bid | A formal offer competing against others, usually against scope documents the customer supplies | Larger, commercial or public jobs |
Words differ by trade and state, so write on the document which one it is and what can change the price. Check your state's licensing and contract rules for any required wording.
What to put on a contractor estimate
- Your details. Business name, phone, e-mail, and license number if your state requires one on documents.
- Customer and job address. The place the work happens, not only the billing address.
- Estimate number and date. Numbers make later invoices and change orders easy to match.
- Scope of work. One short paragraph in plain words: what you will do and where.
- Itemized labor and materials. Lines with quantity, unit price and amount. Itemizing shows the customer what they pay for and makes it easy to adjust one line.
- Exclusions. What is not included (permits, disposal, painting after drywall, hidden damage). This is where most disputes are prevented.
- Tax, total and deposit. Show tax if it applies and the deposit you ask for to book the job.
- Valid until. A date after which the price needs to be confirmed. 14 to 30 days is common.
- Acceptance. A line for the customer's name, signature and date, or written approval by e-mail.
A worked example
A fence repair of three sections:
| Labor: 6 hours × $65 | $390.00 |
| Materials: 3 panels × $48, 6 posts × $14 | $228.00 |
| Haul away old panels | $60.00 |
| Subtotal | $678.00 |
| Tax on materials: 8% × $228 | $18.24 |
| Total | $696.24 |
|---|---|
| Deposit to book (30%) | $208.87 |
The numbers are illustrative; tax rules for labor and materials vary by state.
Get the price right before you write it
An estimate is only as good as the number on it. Work out the price from your costs and target margin with the job price calculator and read how to price a contractor job. Plan the deposit with the deposit and payment schedule calculator. If the customer adds work later, use a change order.
Make the estimate in two minutes
The free Estimate & Invoice Maker has starter line items for 18 trades, adds tax and deposit for you and saves a PDF. No sign-up; your data stays in your browser. Prefer a template? Try the free estimate template.
Illustrative figures for planning only. This is not accounting, tax or legal advice.