Estimates vs Proposals and why you need both!

By Greg DeSilva

An estimate is an educated guess of cost, while a proposal is a detailed contract with an exact cost. At first glance you might think “I definitely want a proposal then, what good is an estimate?” An estimate has its time and place and should never be skipped! It should always come first to save you time and aggravation as a home owner as well as for a contractor. When estimates are skipped, which happens often as most contractors offer “free estimates” and don’t realize they’re actually giving out proposals, it wastes everyone’s time if the contractor does not get that particular job. By getting/giving estimates you can see if your budget is in the same ball park of the estimated cost. For example: If a homeowner thinks a master bathroom can be done for $10,000 while most master bathrooms start at $30,000 today in our area, then that conversation should be a short over the phone educational conversation. It should not be a 1/2 hour drive to the home, 45 minutes in the home, 1/2 hour drive back to the office, 45 minutes drawing up a proposal/contract and sending it over just to find out the budget was 1/3 the actual cost. Also as a homeowner, researching contractors, calling a number of contractors, setting up times to be home to meet them, waiting for the appointment, waiting for the “proposal” etc. would be a waste of time and energy. When estimates and proposals are understood and used properly it benefits both parties.