Providing clients with clear and accurate information about a product or service is essential to build trust and establish a respectful working relationship – as well, of course, to maximise the chance that they will sign up and purchase from you.
However, the terms ‘quote’ and ‘proposal’ are often used interchangeably so it’s important to understand the difference to prevent confusion with clients and safeguard your reputation in your business community.
What Is a Quote?
In simple terms, a sales quote is a price that you give to a customer for a product or service.
A quote may be issued for a single product or group of different products, or for a complete service (including the materials that you intend to use). For example, an IT hardware supplier may offer a quote for the purchase and delivery of a new laptop, whereas a bathroom fitter may quote for the cost of installation plus all the fittings and raw materials required to complete the work.
A quote is often limited for a specified time, such as 30 days, as prices may change. The quote should specify additional inclusions (or exclusions) such as the cost of delivery or the amount of manpower required.
The customer should state clearly exactly what they want when requesting the quote so that confusion is prevented.
What Is a Proposal?
When a customer requests a proposal, they are asking you to explain how you will provide a solution for them to an existing problem. The cost, therefore, is a key element of the proposal, but the proposal should also outline the intended outcomes so that the customer understands how the initial problem will be addressed.
Usually, a proposal is a detailed document that is submitted as part of a competitive process with other suppliers. A proposal provides the client with all the necessary information regarding how the required outcomes will be achieved.
Sometimes, it may be appropriate to outline a combination of products or services to achieve your customer’s desired outcomes. If there are multiple solutions proposed, this may help the customer to choose the best option, so that a bespoke package or products or services can be assembled.
Unlike a quote, a proposal often comprises multiple documents such as a cover page, specification sheets, Statement of Work, and contracts or agreements.
Contact Quintadena For CPQ Solutions
Configure, price, quote (CPQ) software can significantly streamline your quotes and proposals, to reduce the time you spend creating them and improve their accuracy.