Is a quote legally binding?

In the UK and most common law countries, a quote is an offer. If the customer accepts it before it expires, you are generally bound by the price. That is exactly why a validity date matters.

What is the difference between a quote and an estimate?

A quote is a fixed price you are offering to stand behind. An estimate is your best guess and is expected to move. Label the document as what it actually is, because customers hold you to the word you used.

What should I do if my costs rise before the quote expires?

If it has not been accepted, withdraw it in writing and reissue at the new price. If it has been accepted you are generally bound by it, which is the argument for a short validity period when your input costs move.

Should I put my terms on the quotation?

Yes, or reference where they can be read. Acceptance of the quote is usually the moment the agreement forms, so terms introduced afterwards on an invoice are a much weaker position.

Does a quotation need a number?

It is not usually a legal requirement, but use one anyway. You will want to carry it onto the invoice so the customer's accounts department can match the two without asking you.

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A quote is an offer, and offers get accepted

In the United Kingdom and most common law countries a quotation is treated as an offer. If the customer accepts it while it is still valid, you are generally held to the price you wrote.

That is the whole reason to use the word deliberately. Call a guess a quotation and you may have committed to it; call a firm price an estimate and you have given away the certainty the customer was buying.

Rules on when an offer becomes binding differ between legal systems, so if you are trading somewhere unfamiliar it is worth checking rather than assuming.

Write down what the price assumes

The price is only half the document. What protects both sides is the scope around it.

What is included, itemised rather than summarised.

What is explicitly not included, which is the line that prevents most arguments.

What you are assuming: access, site conditions, materials, information the customer has to supply, and when.

What happens if one of those assumptions turns out to be wrong.

Validity, and why every quote needs one

Put an expiry date on it. Material prices move, your availability moves, and an open-ended quote can be accepted six months later at a price that no longer works.

Thirty days is a common default and nothing more than a convention. If your costs are volatile, say so and make it shorter.

If it expires and the customer comes back, reissue rather than honouring the old one out of politeness. A reissued quote is a new offer with a new number.

Turning an accepted quote into an invoice

Get the acceptance in writing, even if writing means an email that says yes. A verbal acceptance is real but hard to point at later.

Carry the quote number onto the invoice. It is the fastest way for the customer's accounts department to match one to the other and approve it.

If you are taking a deposit, invoice for it separately rather than issuing the full invoice early. The balance then has its own document and its own due date.

A worked quotation

Northgate Studio Ltd has been asked what a rebuild would cost, and is answering in writing.

Quotation Q-233, issued 2 March, valid for 30 days.
Discovery and specification: 1,400.00.
Design and build, estimated 12 days at 480.00: 5,760.00.
Total 7,160.00, plus VAT.

The validity date is the load-bearing part. A quote is an offer, and without an expiry it can be accepted months later at a price that no longer works.

Naming the day rate rather than only the total lets the customer see what changes if the scope moves.

What is excluded belongs here too: photography, copywriting and hosting are not in this figure, and saying so prevents the argument.

How to make a quotation

Enter your details and the customer's.
List what you will supply, with prices.
Set how long the quote stays valid.
Download the PDF and send it.

Questions about quotations

Is a quote legally binding?: In the UK and most common law countries, a quote is an offer. If the customer accepts it before it expires, you are generally bound by the price. That is exactly why a validity date matters.
What is the difference between a quote and an estimate?: A quote is a fixed price you are offering to stand behind. An estimate is your best guess and is expected to move. Label the document as what it actually is, because customers hold you to the word you used.
What should I do if my costs rise before the quote expires?: If it has not been accepted, withdraw it in writing and reissue at the new price. If it has been accepted you are generally bound by it, which is the argument for a short validity period when your input costs move.
Should I put my terms on the quotation?: Yes, or reference where they can be read. Acceptance of the quote is usually the moment the agreement forms, so terms introduced afterwards on an invoice are a much weaker position.
Does a quotation need a number?: It is not usually a legal requirement, but use one anyway. You will want to carry it onto the invoice so the customer's accounts department can match the two without asking you.