What is a sales quote?
Learn what’s involved in sales quotes and why they’re vital to your business’s success.
Successfully closing a sale is an art form, and a sales quote is a vital part of the process. But what are sales quotes in business exactly? Their purpose can be unclear, particularly if you’ve just started working in sales, so let’s explore their meaning and why sales quotes are so important.
What is a sales quote in general?
A sales quote is a document that tells a potential client how much your product or service will cost. It’s also known by the name of a business quote. It’s not a legally binding contract but rather a formal notice of the estimated price. It also introduces your company and product or service range, so it’s a good idea to provide an item-by-item breakdown of everything included in the quote.
Now that you have the answer to “What is a sales quote?,” let’s define the purpose of sales quotes in business.
What is a sales quote in business used for?
Sales quotes are essential for many businesses because they establish a base price for goods and services. This helps customers financially plan accordingly to make the best decision for themselves and their business. A sales quote helps the business providing the quote to gather resources for upcoming orders.
The following are some examples of what sales quotes are used for:
- Provide time for planning.
- Create new customer relationships.
- Boost the efficiency of a sales funnel.
- Shorten a sales cycle.
- Decrease pricing issues.
- Find price changes quickly.
- Increase trust between customers and businesses.
Sales quote types.
There are three main types of sales quotes, each with a different purpose:
- Estimate. Estimates give clients an idea of a project’s cost without setting anything in stone. They can change based on the client’s and project’s needs — which allows for flexibility while still informing the client about your general price range.
- Fixed price breakdown. Fixed price breakdowns show your clients the exact price they’ll pay, and they’re not subject to change. Use a fixed quote if you know precisely how much your products, like machinery parts, will cost.
- Request for quotation. Responses to requests for quotation, or RFQ, are highly specific, strictly formatted quotes that you send in response to an RFQ from a client. They help the client decide which provider can offer them the best deal.
Should you have approval deadlines for sales quotes?
Ideally, you should have an approval deadline for a sales quote to keep the customer engaged and ensure the process isn’t too drawn out. While the sales process shouldn’t be rushed, extending it too long with lots of back-and-forth communication can cause customers to lose interest.
What’s required in the sales quoting process?
Each sales quote process will be slightly different, but here is some general information that you should include each time:
- Add company information. Add your company’s contact information, the customer’s full name, and the name of the representative the customer can contact with any questions and comments.
- Make an introduction. Write an introduction to create a basis of understanding between you and the customer. Introduce yourself and the company and emphasize why you and your company are the best fit for the project at hand.
- Present pricing and time frames. Share the individual prices and time frames for each product or service that the customer is interested in purchasing. Include separate pricing and timelines for each item.
- Insert legal documentation. Attach any relevant legal documents, such as non-disclosure agreements or waivers, so that the customer can review them.
- Emphasize the total cost estimate. Highlight the total for all the products and services offered. Put the total at the bottom of the quote in a bold font so the customers can easily see it and quickly make a decision.
- Share the quote. Send the quote to your customer and give them some time to review it, as they are likely comparing quotes from other companies at the same time. If they accept, you can share the next steps from there.
Remaining in contact with your customers and giving them all the proper documentation from the start will help ensure smooth sailing with the sales process.
Improve your sales quote workflow.
A delayed quote could cause a client to choose another provider. A smooth sales quoting process is, therefore, critical for your business. Digital quotes are fast to deliver and process and can help you grow your business.
Adobe Acrobat lets you instantly share documents. Plus, you can add e-signature fields so your clients can quickly approve your quotes and track each document’s status.
Explore what more Acrobat can do to help you more easily manage your business’s documents and processes.
