What is an estimate?
An estimate is an itemized, approximate price for a job, given before the work starts. It tells the customer what the job is likely to cost and how you arrived at the number: hours of labor, materials, equipment and tax. Because some details are still unknown, an estimate can change once the work is under way – which is exactly what makes it different from a fixed-price quote.
Estimate vs quote vs invoice
| Estimate | Quote | Invoice | |
|---|---|---|---|
| When | Early, before scope is final | When scope is clear | After the work (or a milestone) |
| Price | Approximate, may change | Fixed for a set period | Final amount owed |
| Binding? | Usually not | Usually, once accepted | A request for payment |
Need a firm price instead? Use the quote generator. When the job is done, open your estimate and click Convert to invoice – the customer and line items carry straight over to the invoice generator.
What to include on an estimate
- Your business name, contact details and license number if your trade needs one
- The customer's name and the job address
- An estimate number and date, and a valid until date
- Separate lines for labor (hours × rate) and each main material
- Tax, any discount and the estimated total
- What is not included, and how much the price may change
- Deposit and payment terms, and a line for the customer's approval
Worked example
A painter estimates a living room and hallway: 16 hours of labor at $55 ($880), 6 gallons of paint at $48 ($288), drywall patching $180 and supplies $65. Subtotal $1,413; with 8% sales tax the estimated total is about $1,526. The terms say the price may vary by up to 10% and that any bigger change will be agreed first – so the customer knows the final bill will land between roughly $1,370 and $1,680.
Tips for estimates that win jobs
- Break it down. Customers trust line items more than one round number.
- State your margin of error. "May vary by up to 10%" prevents arguments later.
- Set a short validity period. 14–30 days protects you from material price rises.
- Price it properly. Check your labor rate with the hourly rate calculator and your margin with the markup calculator.
- Let AI do the typing. Describe the job in the AI box – "paint 2 rooms, 16 hours at $55, 6 gallons of paint at $48" – and the line items fill themselves in.
Frequently asked questions
Is an estimate legally binding?
Generally no. An estimate is an informed guess, not a firm offer. Some places limit how far a final bill can exceed a written estimate without the customer's consent, so state your margin and get approval for bigger changes.
How accurate should an estimate be?
Most trades aim to land within 10–15% of the final price. Say the expected range in the terms and update the customer as soon as you know the price will move.
Can I turn an estimate into an invoice?
Yes. Open the saved estimate and click Convert to invoice. The customer and line items are copied into the invoice generator with the next invoice number.
Should I charge for estimates?
Most small jobs are estimated for free. For large or complex jobs that need site visits, drawings or testing, many contractors charge a fee and credit it against the job if the customer goes ahead.
