The Remodelers Guide to Business

Say Goodbye to Free Estimates

Free Estimate“Click here for your free estimate.” Is this phrase on your website? Are you one of the thousands of remodelers that use this promotion to generate inquiries?

If you are doing it as a purposeful marketing tactic, then more power to you.

But if you hate driving around giving free estimates and think you don’t have a choice, then this PowerTip is for you.

Your time is far too valuable to waste.

When I suggest remodelers charge for estimates, there’s typically two responses I get:

    1. “If I charged for estimates I’d lose 70% of my leads.”
    2. “All my competitors give free estimates, so I have to, too.”

First, let’s address the “I’d lose leads” concern and take a good look at the numbers.

Now, we both know that providing an accurate price for a project can take hours, depending on the size and scope. But, to prove a point, let’s say you can knock it out in 45 minutes.

So, for ten leads you’ll spend 7 1/2 hours estimating. Of course, you don’t email the price (right??), so let’s add in a 30 minute round trip (you’re lucky, all 10 leads are in your backyard).

Plus there’s the 30 minutes to present the estimate. Again, I’m being very conservative here.

In all, you have just spent 17 1/2 hours of your week on free work!

If you’re a regular PowerTips reader, you know that we expect you to work no more than 48 hours per week. But let’s say you work 60 (after all, you have a lot of free estimates to get out), that means you have just spent 30% of your week on free estimates.

On the flipside, assume you had charged for estimates and, as a result, only 3 of the ten leads stuck with you. Even if you now spend 3 hours (instead of 45 minutes) on the estimates, you would have spent 30% less time, and you generated revenue!

And don’t forget, your close rate should now skyrocket. These three leads have already spent money with you, so the likelihood of them “wasting” that investment and starting over with someone else is very low.

But all my competitors offer free estimates

This is by far the most common argument I hear when remodelers defend their free estimate policy.

So I called your mother this morning and when I told her your reasoning she said “if all your friends jumped off a bridge would you do it too?”

Seriously though, I have two thoughts on this.

First, the core element of any marketing strategy is to differentiate yourself. Doing everything your competitors are doing breaks the single most fundamental law of marketing.

Secondly, charging for estimates when your competitors provide them for free naturally moves the conversation to self-adulation.

Think about it, the prospect calls your office about a project and when you mention the price to come out, s/he will inevitably say:

You want to charge me for an estimate? Your competitors are coming out for free! Why would you charge me?

And there it is. An invitation by the prospect to tell them what makes you great.

Still not buying it?

Although I could list dozens upon dozens of remodelers in the US and Canada that charge for estimates (just off the top of my head), I will always have a handful naysayers. “It’s impossible in my area,” they’ll say.

For the doubters who won’t break, let me offer an alternative: differentiate estimates from proposals. You can keep the free estimate button on your website because you are now charging for proposals.

es·ti·mate verb 

/ˈestəˌmāt/ an approximate calculation or judgment of the value, number, quantity, or extent of something.

The key words in the definition are approximate and judgement. You can and should give an estimate over the phone. It’s a pre-qualification tool.

It’s easy. Once you’ve received the description of the project you say, “Okay Mr. Jones, based on what you’ve told me you can expect the project to come in between $100,000 and $160,000.”

There you go. You’ve just provided a free estimate.

Assuming they are still on the phone and didn’t gasp, scream or pass out, you can now offer to give them a full-blown proposal for $X, which will be “deducted” (optionally) from the project price if they choose you.

What about you?

Do you charge for estimates (or proposals)? If not, do you think you could never do so? Do you think I’m out of my mind? I’d love to hear from you. Please share in the comments below!


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