AvoQuote vs Estimate vs Bid vs Proposal: Which One to Send
Quote vs estimate vs bid vs proposal: what each word commits you to, when a quote becomes binding, how to write an estimate that can change without a fight, and the.
The difference in one sentence each
An estimate is your best approximation of the cost; the final price can change if the job changes. A quote is a fixed price for a defined scope; once the client accepts, that is the price. A bid is a quote submitted in competition, usually against a specification. A proposal is a quote plus the reasoning: approach, schedule, options.
The word you put at the top of the document matters, because clients, and courts, read “quote” as a promise and “estimate” as a forecast.
Side by side
| Estimate | Quote | Bid | Proposal | |
|---|---|---|---|---|
| Price | Approximate; may change with scope | Fixed for the stated scope | Fixed; competitive | Fixed or options |
| Binding when accepted | No, only the terms are | Yes, for the scope described | Yes, per bid rules | Yes, for the option chosen |
| Scope detail | Enough to price | Precise; exclusions listed | Follows the spec | Narrative plus line items |
| Expiry | 30 days typical | 14–30 days | Set by the bid | 30 days |
| Use it when | Hidden conditions, repairs, early stage | Clear scope, known materials | Commercial and public work | Larger jobs, design choices |
When to send an estimate
- You cannot see everything: behind the wall, under the floor, inside the engine. Say so on the document and price what you can see.
- Material prices move faster than your expiry date.
- The client has not finished deciding what they want. An estimate lets them see the number without you committing to a scope they will change.
- Write “Estimate” in the title, and add the line: “Final invoice may vary with scope or site conditions; any change will be approved in writing before work continues.”
When to send a quote
- The scope is defined, you have measured, and you know the materials cost. Repeat work, standard installs, cleaning by the room, photography packages.
- The client needs certainty to say yes, or is comparing you with others. A quote wins against an estimate of the same number.
- Write “Quote” in the title, list what is excluded as clearly as what is included, and set a short expiry. Changes become change orders with their own price.
Bids and proposals
- A bid follows someone else's specification and is judged mostly on price; read the bid documents for the exact format and deadline, and never add conditions the spec does not allow.
- A proposal is for when the client needs to understand the approach before the price: a kitchen remodel with three cabinet options, a website with phases, a photography package with add-ons. Price each option as its own quote inside the proposal.
How an estimate becomes an invoice
Keep the lines identical. The client approved “Framing labor, 16 h × $55”; the invoice should say exactly that, plus any change order on its own numbered line and the deposit as a credit. When the estimate and the invoice look like the same document with a different title, there is nothing to argue about.
If you estimate often, use a template or app that converts the estimate to an invoice without retyping; retyping is where numbers drift and disputes start.
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Questions
Is a quote legally binding?
Once the client accepts it, generally yes, for the scope it describes. That is why a quote must list exclusions and an expiry date. An estimate is not binding on price, but the terms on it (deposit, payment schedule) are.
Can an estimate be higher than the final bill?
Yes, in either direction. A good estimate states a range or the conditions that would change it. Many states require written approval for increases above a threshold (often 10%) on home repairs and auto work.
What is the difference between a bid and an estimate?
A bid is a fixed, competitive price against a specification, usually for commercial or public work. An estimate is a non-binding approximation for a client who has not fixed the scope.
Should I charge for an estimate?
Most trades give a free estimate for straightforward jobs and charge a diagnostic or design fee when the estimate itself takes real work (auto diagnostics, remodel design). Credit the fee against the job if they hire you.
Quote or quotation: which word?
Same thing. “Quotation” is slightly more formal and common outside the US; “quote” is standard American business usage. Either is fine as the document title.