Free estimates...friend or foe?

[brian oliver]

I'm in the process of revisiting a number of my shop policies and was thinking about estimates and quotes.
The time required for these can be intensive and can eat deeply into the bottom line. What is your policy regarding this necessary though (oftentimes) time-intensive service? Do you charge a flat fee? Charge for the expected time investment? Or do you provide them as a free service in the hope of landing the contract and recouping the cost of the time there?
Just to be clear, I'm not talking about design time. I charge for that. But if there is no design work required, I'm considering charging for a quote that might take an hour or more to put together.
Thanks for your input.

 

[Johnny Best]

Yea, good luck for charging for a quote. Trying to get business through quotes is part of doing business.
Or, maybe your on to something, they will hear you charge for a quote and think you are somebody special and give you the work. You just have to be better at making that sign better than everyone else.

 

[Christian @ 2CT Media]

Should your suppliers charge you to give you a quote on the supplies you need?

 

[bob]

Please explain, as well as you might be able, how someone would decide to buy something of greater magnitude that a Snickers bar without first knowing how much it will cost?

After reading your screed someone might just naturally come away thinking that you appear to have an artificially high opinion of yourself and the value of your time. Your time might be of value to you but it most certainly is not to anyone else. Moreover, one does not design signs, one lays them out. A process that is part and parcel of making a sign. Only specimens with a fraudulently high opinion of themselves, such as you appear to have, charge for merely laying out a sign.

 

[Rick]

I only layout/design signs but deal with quotes and estimates. Through the years I have kept track of the time it takes and have incorporated that time into my hourly rate. I looked at your site and see you have been doing this since 1981, I'm sure most of the estimates you get are very similar to previous projects so I'm thinking you need a process in place that shortens your estimating time. But in the long run, estimate how much time you spend, and raise your hourly rate.

One thing... what percentage of work are you getting? If your only landing a small percentage of your estimates, you might have to figure out where you need to sharpen your pencil and/or get a better process going.

By the way, as Bob alluded to, most design work that sign shops do is layout. Every sign shop I worked for gave free layouts and estimates, most gave real design away too. I can see your not the typical digital print shop... I don't think you think highly of yourself, estimating can kill your bottom line. I'm sure like me, when you get a prospective job, you have to go through the city or counties sign code, most projects in California deal with a comprehensive sign programs as well so I have to read that, then someone surveys it, takes a pic of the storefront or areas where the sign(s) goes, get the clients artwork, then I lay it out... that can take an hour or 2 at the very least - then you have to estimate it... it's a lot of time. But ask yourself, what is your competition doing? I doubt anyone charges for it.

I mostly deal with larger sign projects, apartments, corporate centers, shopping centers, sometimes the submittals are 2-300 pages... they can take a week or 2 to estimate. The only time I pay a shop to estimate is so I can stay within my clients budget, but once thats done and the project goes out to bid, I may get 3-6 quotes, a lot of wasted time for those who lose the bid. I have yet to have anyone ask to be compensated for their time.

-- Figure out the time you spend, raise your rate to compensate yourself for that time
-- Reevaluate your estimating process - especially if you are only winning a small percentage of your estimates

 

[Texas_Signmaker]

Free estimates is you going out on an "interview". What would you say if your trying to hire a new employee and they ask for a fee in order to come in for an interview? You have no idea who they are, just the same the customer has no idea if your the best sign company or some hack.

The cost of time invested into free estimates should be considered into figuring out your pricing and cost of business.

As far as design / layout: On large orders say over say 1k, I will include a free layout if the customer has a logo they can supply. I put said logo on a sign that is to scale to the photo so they can visually see the product they want to purchase. This is a sales aid that will help me make the sale. On small orders like things under $300 or so I will not. I request that the order is paid in full and then we will move to the design portion. If they are unhappy with the design they can always get a refund.

Sometimes when I do a free layout, the customer will try to get into a back and forth with me on tweaking the design. I kindly let them know that it's just a rough draft to show what they would be getting, and once an order is placed we can iron out the design details.

There is an exception to this rule... If someone calls needing a written estimate to repair a damaged sign I will charge them $125 plus any travel. There are other sign companies in my area that do the same. I think they found that those people only need it for insurance and almost never convert to being a paid customer.

 

[equippaint]

Be happy youre not in construction. Many of then employ high paid estimators and spend some serious time on bidding jobs, sometimes months on large civil projects. Most of which they usually dont end up getting.

 

[NateF]

I don't typically charge for an estimate that I can simply write up based on customer-supplied specs. If a site visit is required, then it depends on the customer. For many of our regular customers, or for a business very close to us, I don't charge to come out and take photos/measurements. For those who have a habit of asking for quotes and never moving forward with jobs, I generally charge for a site survey. For new customers, I make a seat-of-the-pants decision based on how I feel about them.

I usually explain in detail why I need to make a site survey (measurements of the windows, building facade square footage, how the existing sign is constructed, etc) so that they can understand the information that I need. If it's information they're capable of gathering I give them the option of doing the measurements themselves and accepting liability for them. I don't know if this is the best solution, but it's helped weed out the tire kickers.

Charging for design is similar. Since proofs are typically emailed, there's no easy way to guarantee that our design won't be given to someone else. We charge a deposit to cover the design, and then start work on it. If they're concerned that they might not like our design, I point them to our portfolio of finished signs as a good example of what they can expect from us.

 

[Bly]

If you start charging for quotes I'm sure you won't have to spend as much time doing them.

 

[Oroscoe]

Figure it in the price of the job.

 

[unclebun]

The way things go around here the last 8 or so years (though it's changed since Jan 2017), I'd have to figure the price of 6-8 quotes in every job. Seems like that's all we did was run around, driving 20, 30, 60 miles to do site surveys, then prepare quotes for jobs that we not only didn't get, but nobody did because the business never got off the ground and never opened, or they didn't replace their sign after all.

 

[Texas_Signmaker]

The way things go around here the last 8 or so years (though it's changed since Jan 2017), I'd have to figure the price of 6-8 quotes in every job. Seems like that's all we did was run around, driving 20, 30, 60 miles to do site surveys, then prepare quotes for jobs that we not only didn't get, but nobody did because the business never got off the ground and never opened, or they didn't replace their sign after all.

dang, I usually get about 60%... don't know if thats good or bad but 6-8 to 1 seems horrible.

 

[Solventinkjet]

I would say a quote you can do over the phone or email should be free. If you have to go on site to take measurements etc. I would charge a flat fee based on distance and time. You should price the time it takes to quote into your product. No one likes to see the gritty details of the cost of something. They just want to see what it's going to cost them period. Sometimes when you break it down, you give them too much leeway to haggle you and complain about fees.

 

[CanuckSigns]

I would say a quote you can do over the phone or email should be free. If you have to go on site to take measurements etc. I would charge a flat fee based on distance and time. You should price the time it takes to quote into your product. No one likes to see the gritty details of the cost of something. They just want to see what it's going to cost them period. Sometimes when you break it down, you give them too much leeway to haggle you and complain about fees.

i agree, I tell people that if they can sent me a picture of the existing sign or of the area, along with some rough measurements I can give a ballpark price, once we get the job and a deposit, I'm more than happy to drive to site and do a proper site visit, the price may change depending on the site visit.

With pictures and google street view you should be able to get a rough idea.

 

[JTBoh]

From a sales perspective:

I'm (usually) thrilled to go out and talk to customers, and do a site survey. It gets me a face-to-face with a decision maker, and allows me to "show off".

I will straight up tell customers that "we're all the same, give or take 10% or so" and have told them "You can't sell signs - I'm here selling me". The candor and honesty combined with blatant advertising of skill works wonders - but none of that happens if I don't get to meet them.

My conversion is up around 50%, and I'm managing ~75k of jobs currently. Gotta be doing something right.

 

[Billct2]

I don't charge for them. Most estimates aren't that involved, if I get an complicated one I make a judgement call on whether I want to take a shot at it. The ones I usually pass on are for a contractor (who isn't a repeat customer) who is bidding a large project and there on signs involved. They don't even have the job, and if they do get it there's no guarantee they will come back to me anyhow.

 

[brian oliver]

I only layout/design signs but deal with quotes and estimates. Through the years I have kept track of the time it takes and have incorporated that time into my hourly rate. I looked at your site and see you have been doing this since 1981, I'm sure most of the estimates you get are very similar to previous projects so I'm thinking you need a process in place that shortens your estimating time. But in the long run, estimate how much time you spend, and raise your hourly rate.

One thing... what percentage of work are you getting? If your only landing a small percentage of your estimates, you might have to figure out where you need to sharpen your pencil and/or get a better process going.

By the way, as Bob alluded to, most design work that sign shops do is layout. Every sign shop I worked for gave free layouts and estimates, most gave real design away too. I can see your not the typical digital print shop... I don't think you think highly of yourself, estimating can kill your bottom line. I'm sure like me, when you get a prospective job, you have to go through the city or counties sign code, most projects in California deal with a comprehensive sign programs as well so I have to read that, then someone surveys it, takes a pic of the storefront or areas where the sign(s) goes, get the clients artwork, then I lay it out... that can take an hour or 2 at the very least - then you have to estimate it... it's a lot of time. But ask yourself, what is your competition doing? I doubt anyone charges for it.

I mostly deal with larger sign projects, apartments, corporate centers, shopping centers, sometimes the submittals are 2-300 pages... they can take a week or 2 to estimate. The only time I pay a shop to estimate is so I can stay within my clients budget, but once thats done and the project goes out to bid, I may get 3-6 quotes, a lot of wasted time for those who lose the bid. I have yet to have anyone ask to be compensated for their time.

-- Figure out the time you spend, raise your rate to compensate yourself for that time
-- Reevaluate your estimating process - especially if you are only winning a small percentage of your estimates

Thanks. Your response was helpful.

 

[brian oliver]

Free estimates is you going out on an "interview". What would you say if your trying to hire a new employee and they ask for a fee in order to come in for an interview? You have no idea who they are, just the same the customer has no idea if your the best sign company or some hack.

The cost of time invested into free estimates should be considered into figuring out your pricing and cost of business.

As far as design / layout: On large orders say over say 1k, I will include a free layout if the customer has a logo they can supply. I put said logo on a sign that is to scale to the photo so they can visually see the product they want to purchase. This is a sales aid that will help me make the sale. On small orders like things under $300 or so I will not. I request that the order is paid in full and then we will move to the design portion. If they are unhappy with the design they can always get a refund.

Sometimes when I do a free layout, the customer will try to get into a back and forth with me on tweaking the design. I kindly let them know that it's just a rough draft to show what they would be getting, and once an order is placed we can iron out the design details.

There is an exception to this rule... If someone calls needing a written estimate to repair a damaged sign I will charge them $125 plus any travel. There are other sign companies in my area that do the same. I think they found that those people only need it for insurance and almost never convert to being a paid customer.

Thanks. This was helpful.

Please explain, as well as you might be able, how someone would decide to buy something of greater magnitude that a Snickers bar without first knowing how much it will cost?

After reading your screed someone might just naturally come away thinking that you appear to have an artificially high opinion of yourself and the value of your time. Your time might be of value to you but it most certainly is not to anyone else. Moreover, one does not design signs, one lays them out. A process that is part and parcel of making a sign. Only specimens with a fraudulently high opinion of themselves, such as you appear to have, charge for merely laying out a sign.

Thanks for your input. Just to be clear, I don't charge for simply laying out copy. But I do charge if a customer wants a sign that will require some workmanship and will likely boost their brand in the eyes of their customers. You can check out my portfolio to get an idea of what I'm referring to.

 

[brian oliver]

I don't typically charge for an estimate that I can simply write up based on customer-supplied specs. If a site visit is required, then it depends on the customer. For many of our regular customers, or for a business very close to us, I don't charge to come out and take photos/measurements. For those who have a habit of asking for quotes and never moving forward with jobs, I generally charge for a site survey. For new customers, I make a seat-of-the-pants decision based on how I feel about them.

I usually explain in detail why I need to make a site survey (measurements of the windows, building facade square footage, how the existing sign is constructed, etc) so that they can understand the information that I need. If it's information they're capable of gathering I give them the option of doing the measurements themselves and accepting liability for them. I don't know if this is the best solution, but it's helped weed out the tire kickers.

Charging for design is similar. Since proofs are typically emailed, there's no easy way to guarantee that our design won't be given to someone else. We charge a deposit to cover the design, and then start work on it. If they're concerned that they might not like our design, I point them to our portfolio of finished signs as a good example of what they can expect from us.

Thanks, Nate. My current approach is very similar.

 

[brian oliver]

I would say a quote you can do over the phone or email should be free. If you have to go on site to take measurements etc. I would charge a flat fee based on distance and time. You should price the time it takes to quote into your product. No one likes to see the gritty details of the cost of something. They just want to see what it's going to cost them period. Sometimes when you break it down, you give them too much leeway to haggle you and complain about fees.

Thanks, Vander. You make good points.