11 Key Factors to Consider Before Providing a Contractor Estimate

4.5-minute read | Jul 24, 2023

The contractor estimate is one of the most critical pieces of the home improvement project sales process for both the potential customer and the contractor. For many homeowners, a key selling point is which contractor can provide them with the most “bang for their buck.” 

And for the contractor, an accurate project estimate helps ensure necessary profit margins and boosts the bottom line. Considering its importance, we have outlined the 11 key factors to consider before providing a contractor estimate.

Contractor providing estimate

1) Does the project require a consultation, or will a contractor estimate suffice?

A key initial step is determining if the project requires a consultation or if an estimate will suffice. Some projects may be straightforward enough to provide a simple quote, while others may necessitate a comprehensive consultation to understand the full scope of the work. This decision directly impacts the level of detail and planning necessary to move forward effectively.

2) What does the client want?

It’s crucial to thoroughly understand what the client wants before creating the contractor estimate. Walk through the physical space with them to understand their vision for the home improvement project so that you can accurately capture it in the bid.

3) What is the client’s preferred material?

Understanding the client’s preferred material is another essential factor in project planning. Different materials can dramatically affect the project’s look and cost. Knowing the client’s preferences helps to create an accurate contractor estimate and align the final product with the client’s expectations.

4) What is the availability and cost of the preferred material?

The availability and cost of materials can significantly impact the feasibility and budget of the project. Certain materials may have longer lead times or higher prices that must be factored into the project plan and contractor estimate. Researching these aspects thoroughly ahead of time avoids unforeseen issues or costs later in the project.

5) What is the project budget?

Identifying the client’s budget early in the process is paramount. A clear understanding of the budgetary constraints can guide decisions about materials, labor, and other project costs included in the contractor estimate.

6) Will you need to subcontract any work on the project?

Considering whether you’ll need to subcontract any work on the project is a key factor in developing an accurate contractor estimate. Some tasks may require specialized skills or additional manpower that subcontractors can only provide. Factoring in the cost and availability of these subcontractors in the planning stage is critical for success.

7) What is the project timeline?

The desired project timeline is a key factor when creating the contractor estimate. It will help you determine the availability of material, how many crew members you will need, and if you can even complete the project on time. Not only will this play a key factor in the estimate, but it will also help manage client expectations.

8) How much should be set aside for allowance/contingency funds?

No matter how accurate your contractor estimate is, there are some things that you can’t plan for. When developing your estimate, determining how much your client should set aside for allowance or contingency funds is essential. Building this safety net into your contractor estimate can help avoid financial stress and keep the project on track, even if unexpected costs occur.

9) Should I provide my client with a physical copy of the contractor estimate?

Getting all agreements, expectations, and specifications in writing is always a good practice. This provides a reference point for both the client and the contractor and helps to prevent misunderstandings. Written agreements also offer legal protection for both parties in the event of a dispute.

10) Should I even do this project?

Knowing when to say no to a project is an important skill for a contractor. Not every project will be a good fit for your skills, resources, or schedule. If a project seems unfeasible, overly complex, or outside of your area of expertise, it’s better to decline than to risk a negative outcome or client relationship.

11) Will my client need financing for this project?

Whether or not your customer needs financing for the project, offering financing is a great way to avoid the potential sticker shock your customer may experience when they see the overall project cost on your contractor estimate.

Partner Forward with Salal Dealer Direct

We team up with contractors nationwide to provide their customers with affordable financing for various solar and home improvement projects.

We offer some of the most competitive rates and dealer fees because we’re part of a member-owned credit union. That means our profits return to our members—and business partners—through lower rates and fewer fees.

Our Dealer Direct Financing programs feature:

  • An online loan application with fast credit decisions and a high approval rate.
  • Terms and loan amounts are available to fit various budgets and project sizes.
  • Partners pay ZERO dealer fees on our standard program.

How to Start Offering Salal Dealer Financing to Customers

We’re serious about helping your business grow with fast funding times and personalized support from a dedicated and experienced team of lending specialists. To get started, our dealer application process requires these documents:

  • Completed dealer questionnaire
  • Current income statement and balance sheet
  • Copy of business license and/or contractor’s license


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