To do or not to do a free estimate. It’s a debate that has as many supporters as opponents. While some say it is an effective way to attract leads, others argue it wastes billable hours.
What estimates typically include:
- Project scope
- Start and end dates
- Payment terms
- Cost of labor and materials
- Cost for permits
- Expected total costs
Although it may seem like the industry standard, there are reasons why it may be time to rethink your free estimate strategy.
3 Common Myths about the Free Estimate
1) I will Lose Leads
Free estimates are a good way to bring in clients, but too often they attract those who are just shopping around for services. Contractors, then, spend too much time on low-quality leads.
The problem is that this strategy reduces the amount of hours you could be spending on other billable projects. Rather than giving away time for free, you could shift your resources to more cost-effective promotional services to gain new leads.
2) Everybody Else is Doing it
Many contractors think if they stop doing free estimates it will put them at a competitive disadvantage. The truth is not all contractors today do full estimates for free.
Some even argue offering the public a free estimate can make you less competitive, because you may have to raise your hourly rate to compensate. Although many contractors build the cost of a free estimate into a project budget, they do not receive compensation from potential customers who walk away.
3) Nobody will Pay for an Estimate
Another common misconception is that no one would pay for an estimate they could get somewhere else for free. The truth is customers will pay for your time if your services are considered to be valuable.
You could lead prospects down the sales funnel by offering a free initial visit, but then charge for a full estimate.
Another smart strategy is to request payment only from those who do not sign a contract. New customers could be given a deduction for the free estimate’s cost. However you handle it, the key is to add value by providing a more comprehensive project evaluation.