WAC Presentation on

Quotations Estimates and Tenders

Group IIIANOOP CHAND

CHETNA SINGHALSHUBHAM SAMDANI EASWARAMURTHI P

SUTAPA MISHRAVAIBHAV GARGV S R PRAVEEN

Modern. Effective. Persuasive

QuotationsFixed price

offer

EstimatesEducated Guess

TendersOpen Invitation

L1 Bidder

Why go for Quotation or Estimate ?

• It's impossible for some businesses to give standard prices for goods and services.

• This may be because the skills, time and materials required for each job vary depending on different customers' needs.

• E.g.., Decorators or builders

QUOTATION ESTIMATE

It is a fixed price offer that can't be changed once accepted by the customer

It is an educated guess at what a job may cost- but it isn't binding

This holds true even if you have to carry out much more work than you expected

It does not hold true if you have to carry out much more work than you expected

You can also specify in the quotation precisely what it covers, and that variations outside of this will be subject to additional charges.

This will prevent your customer from being surprised by the costs

How to work out quotation and estimates?

Know your fixed and variable costs.

Provide it in writing and include a detailed breakdown

State clearly whether it is a quotation or an estimate

Set an expiry date. It will no longer be valid after this time

Quotation

Quotation is a promise to supply goods on the terms stated

A Written QuotationBasically you can divide the quotation into 3 main parts : The Header, Body and Footer. •Quotation Header (Top Part)1. Your letterhead2. The words “Quotation”, “Quote” or your preferred term clearly written

towards the top of the page.3. If you are registered to bill and collect tax, you may also need to

include your Tax Registration Number. This can usually be indicated just below the words “Quotation” or at your letterhead.

4. The Quotation Number. This a running serial number that you maintain. You should only have one number per quotation issued.

5. The Quotation Date.6. Your Payment Terms or how soon you expect to be paid. Some example

include : “COD”, “Cash”, “Cash on Delivery”, ”30 days”, “Full Payment on Delivery”, “50% To Start, balance on completion “. The payment terms can also be placed on the footer if preferred.

7. Your Customer or Client Name and Address.

Quotation Body (Middle Part)

A description of the goods you are supplying, quantity, unit of measure, price per unit and total amount for individual items. In the case of services, your scope of work and amount for individual items.

Quotation Footer (Bottom)

1. Total Amount of all individual items.2. If applicable, a tax amount and total after tax.3. Validity of the Quote. For example ”This quote is valid for 60 days”4. Other comments you may have like delivery instructions, goods

return policy, overdue payment policy etc. 5. Your business authorised signature if necessary6. Options for customer to sign and stamp if your quote is accepted (this is

optional)

Types Of Quotation

• Routine Quotation– Request

– Quotation

Tabulated Quotation

Quotation Rejected

Quotation Accepted and Further Enquired

EstimateAn estimate is an educated guess at what a job may cost - but it isn't

binding

Factors Affecting the Decision to Make Estimates

Hence estimate should include the following:

• overall price• breakdown, listing the components of the price• schedule, detailing when work will be done or products

delivered• terms and conditions• time period the estimate is valid for• payment terms or schedule

A Sample Estimate

Estimate for Car Repair  Dear Mr. Easwar,

Thank you for allowing us the opportunity to serve your car. We are willing to act upon your requirements, but reserve the right to review the pricing structure.

We are pleased to submit the following estimate:

 Brake pads – Rs.150 Brake shoes – Rs. 130Labour cost – Rs.150

The estimated prices are for the services and the spare parts delivered in accordance with the project's timetable. Plus any state applicable taxes are included in our pricing proposal. 

Our credit terms are 20% percent in advance and 80% percent upon delivery. 

Please feel free to get in touch with me at 7503139*** about any of the specifics of this estimate. Again, thank you for considering Sai Service Auto Parts for your service.

Best Regards,Vaibhav GargSai Service Auto Parts

TendersIf you provide goods or services to other businesses or the public sector, you may have to compete for contracts by submitting a tender.

Tenders by Classification

• Empanelment/Registration• Auction• Buy• Sell• Work Contract• Service Contract

Sample tender Notice

Factors to be considered

• Life time cost initial purchase cost + maintenance costs +

downtime costs + the cost of consumables and disposal.

• Optimal level of bidding:Don’t bid too high or too low

• Customer point of view