The need for speed and precision
When someone asks for a price, don’t delay.
They have already decided they want the work done, so help them choose you by being prompt. Remember the slogan “money loves speed”.
However, never rush complex jobs; give yourself time to assess labour, materials, and potential risks.
While a quick response wins the job, an accurate one ensures you remain profitable.
Defining the scope and terms
A professional quote must include client details, a clear description of work, the total price and whether GST is included and a validity period to protect against rising costs.
It is vital to outline your assumptions, exclusions and any required deposits. Using professional software helps ensure the layout is clear and the breakdown of stages or materials matches the complexity of the project.
Clear, detailed quotes build trust, reduce the likelihood of disputes and make it easier to manage profitability.
Managing changes and acceptance
A quote is a firm price for a clearly defined job, not an estimate.
To make it legally binding, always require a formal sign-off or digital acceptance before starting.
Ensure the client understands that any changes to the original plan are “variations” that will require a written price adjustment. This prevents “scope creep” and protects your margins.
Choosing quotes vs estimates
Use a quote when costs are predictable and well-known. Use an estimate – an approximate cost based on available info – when hidden issues might arise, such as in renovations. Being clear about which one you are providing manages expectations and builds trust.
Ultimately, a detailed, well-documented price reduces disputes and proves you stand behind your professional standards.
The legal weight of an estimate
Under the Fair Trading Act and the Consumer Guarantees Act, an estimate is not a “blank cheque”.
While it isn’t a fixed price, New Zealand law requires it to be based on reasonable grounds.
If the final cost exceeds the estimate by more than a typical margin – often cited around 10-15% – it may be challenged as “unreasonable” unless the client explicitly agreed to a change in scope.
You have a duty to inform the client as soon as you realise costs are escalating. Continuing the work without a written variation for a significant price increase leaves you legally vulnerable.
