Knowing the price of the product is among the priorities of the buyer when making product inquiries. Upon sending a request to the seller, the prospective buyer will wait for the quotation made by the seller. A quotation must present the quoted price of the items requested by the client. It may include the necessary information that the client must know, and it can still be subject to change depending on the agreement of the seller and the buyer.
Moreover, a quotation is not just a mere document in a sales transaction. It can also serve as a marketing tool for an entity to boost their branding, hence a leverage to an increased sales. So, it is important that a company must make sure that they are designing a professional and presentable quotation. Here are some quotation templates and examples that you may refer to.
Initially, you might think that a quotation is just a simple document you send to your potential customers. However, there is more to quotation than you think. A well-crafted quotation can help increase customer conversion from prospects to buyers and loyal customers. Here are the essential elements that comprise a quotation.
1. Seller information: This is your best chance for launching your brand to your potential customer. Now that you have given a hint that an individual is somewhat interested in your products, grab the chance in introducing your company by providing your information such as the company name, location, and contact details like phone number, email address, website, and social media accounts. This will encourage people to communicate with you since you are making your lines open. You are on the brink of making a sale, so do not lose that single chance in endorsing yourself to the public.
2. Period of validity: The typical validity period of a price quotation is 30 days. Why do quotations have a period of validity? Well, for manufacturing entities that require raw materials for their production, the price of the raw materials in constantly changing. The price stated in the quotation must reflect these changes as well in order for the company to come up with a reasonable price. Hence, it is fitting and proper that a quotation must have a period of validity, depending on the fluctuations of the amount of the raw materials to be used in the production of the items being listed in the quotation.
3. Details of the product: The role of the buyer is to specify the products that he or she wanted to be quoted while the role of the seller is to provide the price and other important information related to the product or provide a quotation to the buyer. The quotation must contain the details and information of the product such as size, color, variation, and quantity. In some cases, when the buyer is too specific with his or her request, there is no need to send a quotation since there is no longer a demand for the details of the product. In this case, it is deemed a purchase, and an invoice can immediately be sent to the customer.
4. Price: After providing a short description or title of the product, the price for each item must be specified. Note that the price must be for one quantity then multiplied by the number of items to be purchased to arrive at the total price for a certain item. Typically, this is the main concern of the buyer and the first thing that they would look for upon receiving the quotation. If some items are with a discount, the discount rate must also be indicated. This would encourage the potential customers to pursue in buying the product.
5. Additional charges: The transaction may be subject to other charges to be shouldered by the buyer. It is important that you will inform the buyer beforehand regarding these charges in order for them to expect a higher amount to be paid to complete the transaction. Examples of additional charges are taxes, fees, insurance, and shipping costs, although the shipping costs are not absolutely to be shouldered by the buyer. There are certain cases when it is shouldered by the seller depending on their agreement before the sales transaction.
6. Warranty: Warranty against defects or service warranty and replacement warranty are typical in many sales transaction. People are concerned regarding this matter because this will guarantee that the seller will continue providing services to the seller for a specified period of time. The scope of the warranty must be clearly specified as well as the warranty period. Depending on the nature of the product or the business entity, the period of warranty may differ. So make sure this is stipulated in the quotation. You may also see proforma invoice examples.
7. Totals: This pertains to the subtotal and grand total in the quotation. The subtotal is the sum of all the total prices of the items, while the grand total is the amount arrived after all the additions and deductions have been made to the subtotal.
8. Terms and conditions: These are the statements of the terms and conditions to be agreed by the parties before proceeding to the sales transaction proper. It may also include supplementary notes detailing the payment modes and other further information related to the transaction.
9. Salesperson: The information of the salesperson is also important so that the buyer would know who is in charge of the transaction. The name and contact details of the salesperson must be included, and he must affix his signature acknowledging that he or she will take charge in case there are queries and other concerns from the buyer. You may also see sales invoice examples.
Creating a quotation is pretty simple with the help of computer applications and software as well as templates. Here is a simple guide in creating a presentable and elegant quotation:
1. Choose a template: First, you must choose a template that perfectly suits your needs and the one that reflects the personality of your company. There are tons of quotation templates that you can find in the Internet such as those presented above.
2. Evaluate the order: Then, assess the order or request of your potential client—what items he wanted to purchase, the quantity, as well as specific product descriptions. Be keen to some specifications stated by the prospective client, so you can give him or her the most appropriate quote.
3. Input the details: On your template, fill out the necessary details of the quotation including your branding elements such as your company name and logo, and see to it that you are not missing anything or commit an error in typing the product name, quantity, price, etc. You may also see free invoice examples.
4. Edit the layout: You can edit and adjust the layout as well as the elements in your template according to your own preference. You can also change the font color, size, and type and the overall design of your template. Customize your template so you can call it your own and is something that you can be proud of.
5. Finalize: Lastly, finalize your work and recheck if there are no typographical or spelling errors before sending it to your client. You can send your quotation through email or the client may prefer to receive a hard copy. Either way, you must keep a copy of the quotation for your own reference.
There are different types of quotation that a company can use depending on the nature of the sales transaction or the agreement between the seller and the buyer. The common types of quotation being used by many entities are as follows:
Here are some frequently asked questions regarding quotation answered.
A quotation is sent prior to the invoice. This document merely provides information to the prospective customer regarding certain products and is not a form of demand for payment. The buyer can still request to change the quantity, or the price can still subject to some changes.
In the sales transaction process, it begins when a potential customer sends request or order from the seller. The buyer in return will send a quotation, providing the details of the product being requested by the potential customer. The potential customer will communicate his or her approval to the items being quoted so the seller can send the final amount of the items requested in the form of an invoice. This would also prompt and inform the buyer of his or her payable. Lastly, after the buyer paid for the items, a receipt is issued to the buyer. Here, we observed that the quotation is in the middle part of the transaction. It comes after the potential client sends an order and before the issuance of the invoice.
There is a significant difference between the two in the sales transaction. A quotation is sent before an invoice. The content of the quotation such as the price and the quantity can still be changed when agreed by the seller and the buyer, while that of the invoice is the final amount to be paid by the buyer.