Estimate, quote, or bid: the difference

A customer asks what the job will run. You say you will send an estimate, you write one number at the bottom of the page, and she signs it. Weeks later the final bill is a couple of thousand dollars higher, and she is holding a page that says otherwise. The argument that follows is not about the work. It is about what that page was.

Three words, three different promises

The three words carry different expectations, even though people swap them freely. None is a legal category: no statute defines them, and the table below is trade convention, not a rule you can cite.

Construction trades tend to say "estimate." Cleaning, landscaping maintenance and most recurring-service businesses tend to say "quote," because nothing is hidden behind a wall. That split is habit, not law.

Where the wrong word costs money

The estimate that got treated as a cap. A single total under the word "estimate," with no exclusions and no change-order term, reads to a customer as a price, and the header does not undo that.

The quote you gave before you saw the job. A number over the phone, called a quote, is the fastest way to get locked into a price you have not checked. Say "range" on the phone and "quote" on paper, after you have looked.

The bid a general contractor already used. If you email a sub-bid to a GC and the GC carries your number into its own bid to the owner, you may not be able to walk it back. Following the California case Drennan v. Star Paving Co. (1958), courts in many states have held a sub-bid open for a reasonable time once a GC has relied on it, even without a formal contract. The doctrine is promissory estoppel: a promise the other side reasonably acted on can bind you. How far that reaches, and what counts as reliance, differs state to state — some courts have declined to apply it on facts that look similar. If you send numbers to GCs, ask a local construction attorney how your state handles it.

Binding is about the language, not the header

Contract law is state law, and none of this is legal advice. But the shape holds nationally: a document binds you when it is definite enough to be accepted and the customer accepted it. Scope, price, terms and conduct decide that. The word at the top is evidence, not the answer.

That cuts both ways. "Quote" printed above "all prices approximate, final quantities measured on completion" is not a firm price. "Estimate" printed above a fixed total, a signature line and a start date can look a lot like one.

Three sentences do most of the work, and they are the ones people skip:

• The approximation sentence. Say plainly that the number comes from a visual inspection and may change if conditions differ.
• Unit prices for the unknown part. Per linear foot of rot, per cubic yard of unsuitable soil. This is how you stay firm on the known scope and honest about the rest.
• The change-order term. No extra work proceeds without written approval. Without it, you are arguing later about whether the customer said yes in the driveway.

One more distinction decides which body of law you are in. A contract for your services is generally governed by common law. A contract for goods falls under the Uniform Commercial Code, which every state except Louisiana has adopted in some form. The UCC's firm-offer rule can hold a merchant's signed written offer open without extra consideration, for up to three months — but that is the goods side, not your labor. Jobs that mix supply and installation get sorted by which part predominates, and courts make that call differently. Do not assume your supplier's quote and your quote behave the same way.

Some states also regulate this at the consumer level: home improvement statutes in a number of states require a written contract above a dollar threshold and limit the deposit you can take. Some trades — auto repair is the classic example — require fresh written authorization before a final bill exceeds the written estimate. Thresholds, covered trades and penalties all vary. Your state contractor licensing board or consumer protection office publishes the version that applies to you.

Bids carry rules the other two do not

Public work runs on a process, not a conversation. On a traditional sealed bid, bids arrive by a deadline, get opened at a stated time, and late is late. Award normally goes to the lowest responsive, responsible bidder, so an arithmetic error or an unacknowledged addendum can knock out the best price in the room. Sealed bidding is not the only route — design-build, construction-manager-at-risk and best-value selection are common, and there price is one factor among several. Read the front of the solicitation before you price the back of it.

Then budget for what a bid drags behind it:

• Bid security, usually a bid bond, guaranteeing you will sign the contract and furnish bonds if you win. The percentage comes from the statute or the solicitation, and federal jobs set it far higher than state and local ones.
• Payment and performance bonds above a dollar threshold — the federal Miller Act on federal projects, and each state's "Little Miller Act" equivalent, with its own trigger.
• Prevailing wage rates on federally funded and many state-funded jobs, which reset the labor rates you bid at.
• A withdrawal procedure for a clerical mistake. One usually exists, but it is narrow and the deadline is short. It sits in the instructions to bidders, which is the part new bidders skim.

Which word to use, and what to write under it

If you cannot write the firm-price sentence honestly, you do not have a quote yet. Hold the price with what you know, or name what you do not know and price it by the unit.

Keeping the promise and the paper together

The gap is rarely in what you decided. It is in what made it onto the page. DoneQuote drafts the line items from your own priced catalog and carries your standard exclusions, validity date and change-order terms onto the document, so the commitment you made is the one the customer signs.

Pick the word first, then write to it. A firm price with no expiry and an approximate one with no exclusions are the same mistake, and both get settled at your expense.