Estimates and Quotes Apply procedures to develop plans, estimates and quotes Objective 4.03 Remember key terms, abilities needed, and items included in estimates and quotes for landscape and/ or irrigation plans. » John M. Hess

Key Terms used in Estimates /Quotes. o Estimates—an approximate price to complete a specific project. o Bid (or bidding)--a fixed price on the landscape job to be completed. o Quote—to give exact information on a specific project. o Specs (specifications)--written description of landscape materials needed, number of hours that the job will take and a timeline for the project completion. o Overhead—the general cost of operating a business and is the most likely cost to be left out of estimates by a new landscaper. Assignable—includes non-labor and non-material costs. Examples: special permits, equipment rental, special insurance, temporary utility costs. Unassignable—includes the costs of operating a business that can not be credited directly to a specific project. Examples: cost of equipment, vehicles, gas, tools, insurance, payroll expenses, office expenses, benefits and sick leave. o Materials—items used in a project. o Labor—calculating the time required to install a project. (This is one of the most difficult tasks of the landscape contractor.)

Key Terms used in Estimates /Quotes. o Contingencies—used if a contractor cannot predict weather issues, material delays, labor shortages, equipment which needs repair, etc. (A portion of the project costs should be reserved as a contingency fund which is usually 5%-10% of the total material and labor costs.) o Profit—net income after expenses. o Lump sum —a bid format in which all project costs are provided to the client in a single number. o Itemized—a list of all items and their costs. o Time and Materials (cost plus) —a type of bid that provides a set price for materials and unassignable overhead, plus an hourly cost for labor. o Unit costs —cost per item.

Abilities needed to estimate or quote landscape installation and maintenance jobs o Read and interpret specifications (specs) and drawings for projects o Research costs used to estimate or quote o Know ability of your employees to perform project tasks o Know condition and special requirements for working in a particular region (piedmont, mountains, beach) o Know the client’s wants and needs o Use interpersonal skills—your ability to interact with your client and with others

Items included in an estimate o Cover letter concerning the estimate o Quantities of each type material needed based on landscape or irrigation plan o The approximate cost of materials and labor for the landscape design or the irrigation plan if not provided by client o The approximate cost of clearing the site including labor if site clearing is needed o The approximate cost of plant materials including labor to install o The approximate cost of construction materials plus labor to install o The approximate cost of turfgrass installation materials plus labor to install o The approximate operating cost of equipment including fuel and labor o The approximate cost of sales taxes on materials o The approximate overhead costs (the % assigned to this project) This cost is usually added into the labor costs on estimates. Many inexperienced business owners forget to include overhead and profit when preparing estimates causing business failures. o The approximate total cost for the landscaping or irrigation project o Name of the person completing the estimate and the date of the estimate

Items included in a quote o Cover letter concerning the quote o Quantities of each type material needed based on landscape or irrigation plan o The actual cost of materials and labor for the landscape design or the irrigation plan if not provided by client o The actual cost of clearing the site including labor if site clearing is needed o The actual cost of plant materials including labor to install o The actual cost of construction materials plus labor to install o The actual cost of turfgrass installation materials plus labor to install o The actual operating cost of equipment including fuel and labor o The actual cost of sales taxes on materials o The actual overhead costs (the % assigned to this project) This cost is usually added into the labor costs on quotes. Many inexperienced business owners forget to include overhead and profit when preparing quotes causing business failures. o The actual total cost for the landscaping or irrigation project o Name of the person completing the quote and the date of the quote o Allowance for contingencies

The major difference between an estimate and a quote is that an estimate uses approximate costs and a quote uses actual costs. Since a quote uses actual costs, allowances are made for contingencies.