A quotation is a promise to supply goods on the terms stated. Quotations are also sometimes referred to as bids, quotes, estimates, tenders or proposals. The prospective buyer is under no obligation to buy the goods for which a quotation is requested, and suppliers will not normally risk their reputations by quoting for goods they cannot or do not intend to supply. A quotation will be prepared on the company’s letterheaded paper, and will usually include:

an expression of thanks for the enquiry

details of prices, discounts and terms of payment

a clear indication of what the prices cover, eg packing, carriage, insurance

an undertaking regarding date of delivery

the period for which the quotation is valid

an expression of hope that the quotation will be accepted.

Terminology

When requesting a quotation, the buyer must be careful to establish clearly whether the prices are to include such additional charges as carriage and insurance. Failure to do this may, if not specified in the supplier’s quotation, lead to serious disagreement, especially where such charges are heavy, as in foreign trade dealings. Some terminology associated with quotations is shown here:

Carriage paid. The quoted price includes delivery to the buyer’s premises.

Carriage forward. The buyer pays the delivery charges.

Loco, ex works, ex factory, ex warehouse. The buyer pays all expenses of handling from the time the goods leave the factory or warehouse.

For (free on rail). The quotation covers the cost of transport to the nearest railway station and of loading on to truck.

Fas (free alongside ship). The quotation covers the cost of using lighters or barges to bring the goods to the ship, but not the expense of lifting the goods on board.

Fob (free on board). The quotation covers the cost of loading the goods on to the ship, after which the buyer becomes responsible for all charges.

Ex ship. The quoted price includes delivery over the side of the ship, either into lighters or barges or, if the ship is near enough, on to the quay.

cif. Carriage, insurance and freight. Price covers charges for insurance and transport to the port named.

Routine quotations

Request for quotations for printing paper

Request

Dear Sirs
We will soon need 200 reams of good quality white poster paper suitable for auction bills and poster work generally.
We are looking for paper that will retain its white appearance after pasting on walls and hoardings.
Please let us have some samples and a quotation, including delivery to our office within four weeks of our order.
Yours faithfully

This request complies with the requirements of a satisfactory letter of enquiry.

• It states clearly and concisely what is required.
• It explains what the paper is for, so it helps the supplier to quote for paper of the right quality.
• It states the quantity required, which is important because of the effect of quantity upon price.
• It states when delivery is required – an important condition in any contract for the purchase of goods.
• It states what the price is to cover – in this case ‘delivery at our works’.

Quotation

Dear Mr Keenan
Thank you for your enquiry dated 21 June.
We are pleased to enclose samples of different qualities of paper suitable for poster work. Here are our best prices
for the various qualities, to be delivered to your office:
A1 quality Printing Paper white £2.21 per kg
A2 quality Printing Paper white £2.15 per kg
A3 quality Printing Paper white £2.10 per kg
All these papers are of good quality and quite suitable for poster work. We guarantee that they will not discolor when pasted. We can promise delivery within one week from receiving your order.
Please give me a call on 2634917 if you have any questions. We look forward to working with you.
Yours sincerely

Request for quotation for crockery (dishes and plates)

Request

Dear Sirs
You have previously supplied us with crockery and we should be glad if you would now quote for the items listed here, manufactured by Ridgeway Pottery Company of Hanley. The pattern we require is ‘number 59 Conway Spot (Green)’.
300 Teacups and Saucers
300 Tea Plates
40 1-litre Teapots
When quoting prices, please include packing and delivery to our office address. Please also state discounts allowable, terms of payment and earliest possible delivery date.
I hope to hear from you soon.
Yours faithfully

Quotation

Dear Mr Clarke
CONWAY SPOT (GREEN) GILT RIMS
Thank you for your enquiry of 18 April for a further supply of our crockery. We are pleased to quote as follows:
Teacups £83.75 per hundred
Tea Saucers £76.00 per hundred
Tea Plates £76.00 per hundred
Teapots, 1-litre £4.20 each
These prices include packing and delivery, but a charge is made for crates, with an allowance for their return in good condition.
Delivery can be made from stock and we will allow you a 5% discount on items ordered in quantities of 100 or more. There would be an additional cash discount of 2% on total cost of payment within one month from date of invoice.
We hope you find these terms satisfactory. Please give me a call on 3614917 if you have any questions.
Yours sincerely

Quotations subject to conditions of acceptance

Very often a quotation is made subject to certain conditions of acceptance. These conditions vary according to the circumstances and the type of business. They may relate to a stated time within which the quotation must be accepted, or to goods of which supplies are limited and cannot be repeated. The supplier must make it clear when quoting for goods in limited supply or subject to their being available when the order is received. Examples of qualifying statements are:

• This offer is made subject to the goods being available when the order is received.
• This offer is subject to acceptance within 7 days.
• The prices quoted will apply only to orders received on or before 31 March.
• Goods ordered from our 201- catalogue can be supplied only while stocks last.
• For acceptance within 14 days.

Foreign buyer’s request for quotation

Email enquiry from overseas buyer

Dear Sirs
We have recently received a number of requests for your lightweight raincoats. We are hoping to place regular orders with you, as long as your prices are competitive.
From the description in your catalogue, we feel that your AQUATITE range would be most suitable for this region.
Please let me have a quotation for men’s and women’s coats in both small and medium sizes, delivered cif Alexandria.
If your prices are right, we will place a first order for 400 raincoats, namely 100 of each of the 4 qualities. Shipment would be required within 4 weeks of order.
I look forward to a prompt reply.
Many thanks

Quotation

freight: transport (goods) in bulk by truck, train, ship, or aircraft.

A point of interest (POI) is a specific point location that someone may find useful or interesting.

Tabulated quotations

tabulated: (of data) arranged in tabular form.

Many quotations are either tabulated or prepared on special forms. Such tabulated quotations are: clear, since information is presented in a form that is readily understood complete, since essential information is unlikely to be omitted.
Tabulated quotations are particularly suitable where there are many items. Like quotations on specially prepared forms, they should be sent with a covering letter which:

• expresses thanks for the enquiry
• makes favorable comments about the goods themselves
• draws attention to other products likely to interest the buyer
• gives a link to the website
• expresses hope of receiving an order
• takes the proactive approach of saying the writer will follow up soon.

Covering letter with quotation on specially prepared form

Covering email or letter

Dear Mrs Greenway
Thank you for your recent enquiry. Our quotation for leather shoes and handbags is attached, and all items can be delivered from stock.
These goods are made from very best quality leather and can be supplied in a range of designs and colours wide enough to meet the requirements of a fashionable trade such as yours.
Please visit our website where you will find details of all our other products, including leather purses, gloves and other accessories.
I will follow up with you in a few days to answer any questions. Meanwhile, please give me a call on 9635117 if anything is not clear.
I look forward to working with you.
Matthew Marsden

Quotation

In this quotation, note the following points:

• It is given a serial number to help in future reference.
• Using catalogue numbers identifies items with precision and avoids misunderstandings. Individual shapes and sizes are also given their own serial numbers.
• ‘For acceptance within 21 days’ protects the supplier in case the buyer orders goods after this
  time when prices may have risen.
• ‘4% one month’ indicates that a discount of 4% will be allowed on quoted prices if payment is
  made within one month. For payment made after one month but within two months, the discount
  is reduced to 2%.

Estimate for installation of central heating

Enquiry

Dear Sirs
Please let me have an estimate for installing central heating in my bungalow at 1 Margate Road, St Annes-on-Sea. A plan of the bungalow is attached showing required positions and sizes of radiators, together with a specification showing further details and materials to be used.
I am interested only in first-class workmanship and I want only the best quality materials to be used. However, cost is also important. It is essential that this work is completed by 31 August.
I hope to receive your prompt reply, which should include a firm completion date.
Yours faithfully

Specification

Contractor’s estimate

The contractor can calculate costs from the information provided, and will send an estimate with a
covering letter or email, which should provide the following information:

• A reference regarding satisfactory work carried out elsewhere, which will give the customer confidence
• A promised completion date
• A market prices and wages adjustment clause to protect the contractor from unforeseen increases that may raise costs and reduce profits
• A hope that the estimate will be accepted.

In this letter, note that the contractor aims to inspire confidence by referring to work done elsewhere,
and promises to arrange an inspection if required.

Tenders (P.143)

A tender is usually made in response to a published advertisement. It is an offer for the supply of specified goods or the performance of specified work at prices and under conditions set out in the tender. A tender becomes legally binding only when it is accepted; up to that time it may be withdrawn. It is usual for tenders to be made on the advertiser’s own form, which includes a specification where necessary and sets out the terms in full detail.

A public invitation to tender

Quotations not accepted or amended

When a buyer rejects a quotation or other offer, it is courteous to write and thank the supplier for their
trouble and explain the reason for rejection. The letter of rejection should:

• thank the supplier for their offer
• express regret at inability to accept
• state reasons for non-acceptance
• if appropriate, make a counter-offer
• suggest that there may be other opportunities to do business together.

A counteroffer functions as both a rejection of an offer to enter into a contract, as well as a new offer that materially changes the terms of the original offer.

Buyer rejects supplier’s quotation

Dear Mr Walton
Thank you for your quotation dated 19 February for strawboards.
I appreciate your trouble in this matter but as your prices are very much higher than those I have been quoted by other dealers, I am unable to place an order.
I will contact you again when I require other products.
Yours sincerely

Supplier grants request for better terms

Enquiry

Reply

Follow-up letters

Supplier’s follow-up letter

Dear Mrs Larkin
As we have not heard from you since we sent you our catalogue of filing systems, I wonder whether you require any further information before placing an order.
The modern system of lateral filing has important space-saving advantages wherever economy of space is important. However, if space is not a challenge for you, our flat-top suspended system may be suitable. This system gives a neat and tidy appearance to the filing drawers, and files can be located easily and quickly. Many users find these two features particularly beneficial.
Would you like us to send our representative to call and discuss your requirements in more detail? John Robinson, our representative in your area, has advised on equipment for many large, modern offices. He would be able to recommend the system most suitable for you. There would of course be no obligation. Alternatively, you may prefer to visit our showroom and see for yourself how the different filing systems work.
I look forward to hearing from you soon, or you may contact me on 2356123 with any questions.
Yours sincerely

In advertisements, if a product or a service is available without obligation, you do not have to pay for that product or service until you have tried it and are satisfied with it.

Letter to save a lost customer

Dear
We notice that it is some time since we last received an order from you. We hope this is in no way due to dissatisfaction with our service or with the quality of goods. In either case we would like to hear from you.
We are most anxious to ensure that customers obtain maximum satisfaction from their dealings with us. If lack of orders from you is due to changes in the type of goods you handle, we may still be able to meet your needs if you will let us know in what directions your policy has changed.
As we have not heard otherwise, we assume that you are still selling the same range of sports goods, so a copy of our latest illustrated catalogue is enclosed. We feel this compares favourably in range, quality and price with the catalogues of other manufacturers. You will see in our catalogue that our terms are now much better than previously, following the withdrawal of exchange control and other official measures since we last did business together.
I hope to hear from you soon.
Yours faithfully

Acknowledgement of a first order

When an order is received from a brand new customer, it should most certainly be acknowledged by
phone call, email or preferably both.