Whereas a quotation is an offer to sell goods at a price and under conditions that are stated, an estimate is an offer to do certain work for a stated price, usually on the basis of a specific action. Like a quotation, an estimate is not a legally binding offer so that the person making it is not bound to accept any order that may be placed against it.
Sample of Estimate for installation of central heating.
5th July 2010
Would you please estimate for installing central heating in the bungalow at Margate Road, St Annes—on—Sea.
I enclose a specification and a plan showing required positions of radiators.
Cost is of course a matter of some importance but, as you will gather from the specification,
I am interested only in first—class workmanship and in the use of best quality materials. Completion of the work is required by 31st August at the latest, and I shall be glad if in your reply you will give me a firm completion date so that I can make arrangements for our removal from London.
The specification that would accompany this letter is a statement giving a detailed description of the work to be done and the materials to be used. It provides the basis for the contractor’s estimate. The plan would consist of a rough sketch to scale showing the required positions of the radiators.
Specifications are also prepared by builders and contractors, setting out the terms and conditions on which they are willing to supply certain types of goods or carry out certain work.
SPECIFICATION FOR INSTALLING CENTRAL HEATING
at Margate Road, St Annes—on -Sea
1. Installation of latest type small—bored central heating, to be carried out with best quality copper piping of 15 am bore, fitted with “Ryajand” electric pump of fully adequate power and lagged under floor to prevent loss of heat.
2. Existing boiler to be replaced by a Glow—worm No 52 automatic gas—fired boiler, rated at 15.2 kw and complete with gas governor, flame—failure safety device and boiler water thermostat.
3. Installation of a Randall No 103 clock controller to give automatic operation of the central heating system at predetermined times.
4. Existing hot—water cylinder to be replaced by a calorific—type cylinder15suitable for supplying domestic hot water separately from the central heating system.
5. Seven “Dimplex” or similar flat—type radiators to be fitted under windows of five rooms, and in hail and kitchen according to plan enclosed; also a towel rail in bathroom. Sizes of radiators and towel rail to be as specified in letter dated 25th May 2010 addressed to yourselves.
6. Each radiator to be separately controlled, swiveled for c1eaning and painted pale cream with red—lead under coating.
7. The system to be provided with the necessary fall for emptying and to prevent air—locks.
8. All work to be carried out from under floor to avoid cutting or lifting floor boards, which are tongued and grooved.
9. Insulation of roof with 80 nun fiber—glass.
5th July 2010
After calculating his costs the contractor will send his estimate with a covering letter. The letter need not be lengthy, but it should provide for the following.
(i) A reference to satisfactory work carried out elsewhere. (This gives the customer confidence.)
(ii) A promise giving date of completion. (The customer attaches great importance to this.)
(iii) A market prices and wages adjustment clause. (This protects the contractor from unforeseen increases that may raise his costs and reduce his profits.)
(iv) A hope that his estimate will be accepted.
(c) Contractor’s estimate
11th July 2010
Dear Mr Harris
Margate Road, St Annes—on—Sea
Thank you for your letter of 5th July enclosing specification and plan for a gas—fired central heating system at the above address.
We should be glad to carry out the work for a total of £850, with a 2,5% discount allowance for settlement within one month of the date of our account.
We can promise to complete all work by the end of August if we receive your instructions by the end of this month. We would stress that the price quoted is based on present costs of materials and labor. Should these costs rise we should have to add the increased costs to our price.
We have installed many similar heating systems in your area. Our reputation for high—class work is well known, but if you would like to inspect one of our recent installations before deciding to accept our estimate, we would try to arrange
this for you.
If, as we hope, you are satisfied with the price quoted, please let us have your instructions soon. This would help us in making our other arrangements.
Notice that this letter, like earlier ones, aims to inspire customer confidence,18 this time by referring to work done else where and the promise to arrange an inspection.