Proposal and quote glossary: the words between a brief and a yes

What the words decide

The vocabulary of a proposal sorts into three groups. The first is about the kind of document: an estimate, a quote, a proposal and a statement of work each promise a different thing, and the label at the top shapes what the buyer can hold you to. The second group is about the price: how it is built, whether by the hour or by value, which items are optional, how long it stays open and whether GST is inside or outside the figure. The third group is about the moment of agreement: when an accepted quote becomes binding, what an acceptance certificate records and what happens to an offer that has expired.

Where to start

If you are about to send something and are unsure what to call it, start with the page comparing a quote, an estimate and a proposal, then read the statement of work comparison if the job is large. If the price is the hard part, read how to price a proposal, then the pages on value based pricing and optional line items. If the buyer has gone quiet, the follow up and validity pages cover what to say and when the price lapses. If the buyer has said yes, the pages on binding acceptance and acceptance certificates explain what that yes is worth and how to prove it later.

Australian first, with the general rule

Most pages are written for Australian businesses, so GST is 10 percent, consumer pricing follows the Australian Consumer Law and electronic acceptance rests on the Electronic Transactions Act 1999. The underlying ideas, offer and acceptance, validity, scope and price, apply in most common law countries, and pages say where the rules differ. Nothing here is legal advice; where a page turns on a statute or a regulator's guidance, it links the primary source so the rule can be checked at the point of use.

Every page in this collection

• Do quotes need to include GST in Australia?

  A quote does not have to follow the tax invoice rules, but the GST question still decides what the customer thinks they agreed to pay. Getting it right on the quote saves an awkward conversation when the invoice arrives.

• How long should a proposal be?

  Buyers rarely complain that a proposal was too short if it answered their questions. They often stop reading one that pads every section, which is how a long proposal loses to a shorter one at a similar price.

• How long should a quote be valid?

  A validity period protects you from accepting an old price after your costs have risen, and it gives the buyer a reason to decide. Too short feels pushy, too long hands the buyer a free option on your time.

• How to follow up on a quote

  Most quotes that go unanswered are not rejected, they are forgotten or stuck behind a question the buyer has not asked. A short, useful follow up recovers a surprising share of them.

• How to price a proposal

  The price section is where most buyers start reading and where many proposals lose the job. A good price is defensible on cost, sensible against value, and laid out so the buyer can see exactly what they are paying for.

• How to write an executive summary for a proposal

  The executive summary is often the only part of a proposal the final decision maker reads. If it describes your company instead of the buyer's problem, the rest of the document has to work much harder.

• Is an accepted quote legally binding?

  Most quotes become contracts the moment the customer says yes, which is why the wording on a quote matters more than people expect. Knowing what turns a quote into a binding agreement helps both the business and the customer.

• Quote vs estimate vs proposal: what each one commits you to

  The three words get used as if they were interchangeable, but a buyer reads each one differently and a court can too. The choice comes down to how sure you are of the scope and how much convincing the buyer still needs.

• Statement of work vs proposal: which comes first and why

  Both documents describe the same project, which is why people mix them up. They are read at different moments by different people, and copying one into the other is how scope disputes begin.

• Value based pricing vs hourly: which should you quote?

  Charging by the hour is simple to explain and safe when the work is unpredictable. Charging for value can earn more for the same effort, but only when the outcome is clear and the supplier understands what it is worth.

• What are optional line items in a quote?

  A quote with optional items turns a yes or no decision into a choice about how much to buy. Done well, it raises the average order and leaves the client feeling in control rather than sold to.

• What is an acceptance certificate?

  When a client accepts online there is no wet signature to point to later. The certificate is the page that answers the questions a dispute would ask: who, when, what exactly, and has anything changed since.