Definition
A quotation is a formal document provided by a seller to a potential buyer that lists the price, quantity, and terms for products or services offered.
It’s also called a price quote or sales quote, and it’s not a binding agreement—just an offer to sell at certain terms.
When to Create a Quotation
You create a quotation when:
- A customer requests pricing or details before making a purchase.
- You want to give a fixed price valid for a specific period.
- For custom or bulk orders where pricing may vary.
- To officially respond to inquiries or tenders.
Example 1: Custom Order Request
A client asks for 200 printed t-shirts with a custom logo.
You create a quotation mentioning the price per t-shirt, printing charges, and total cost.
The client will review and approve it before placing the order.
Example 2: Service Proposal
A company contacts you for website development services.
You send a quotation outlining the service scope, timeline, and charges (e.g., ₹25,000 for design + ₹10,000 for hosting).
They confirm based on this quote.