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Glossary

What is a quotation?

A quotation, or quote, is a document a seller gives a buyer offering goods or services at a stated price under stated conditions, so the buyer knows the cost before committing.

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What a quotation includes

A quotation is usually prepared in response to a buyer's request and follows the conditions the buyer set. It typically lists:

  • Items or services. with descriptions and quantities.
  • Prices. unit price, totals, taxes and any discounts.
  • Terms. payment, delivery and warranty terms.
  • Validity. how long the price holds.
  • Reference. a quote number and the buyer's request reference.

When to send a quotation

Sellers send quotes when a buyer asks for one, often through a request for quotation, or when a sale needs a defined price before the buyer can approve it. If the buyer accepts the quotation, it can become the basis of a purchase order or contract.

Why it matters for buyers

Comparing quotations on the same basis is the simplest form of competitive buying. Buyers should check that each quote covers the same scope, note what is excluded and make sure the accepted price is carried into the order and invoice.

How Aavenir handles it

RFPflow runs requests for quotation with structured pricing templates, so quotes arrive in a comparable format. The accepted terms flow into the contract and are checked on invoices by Invoiceflow.

Keep reading

Request for quotation A request for quotation (RFQ) is a process in which a company or public body asks suppliers to quote prices and terms for...Read more Proposal A business proposal is a written offer from a seller to a prospective buyer that explains how it will meet the buyer's...Read more Bid analysis Bid analysis is the process of evaluating and comparing supplier bids received in a sourcing event against set criteria such...Read more

Frequently asked questions (FAQ)

Common questions

Is a quotation binding?

A quotation is an offer. It usually becomes binding when the buyer accepts it, often through a purchase order, within the validity period. Terms vary, so read the quote conditions. Read about purchase orders.

What is the difference between a quotation and an estimate?

An estimate is an approximate price that may change. A quotation is a firm price for defined work, valid for a stated period. Read about request for quotation.

How do you compare quotations fairly?

Ask all suppliers to quote the same scope in the same format, then compare total cost including delivery, terms and exclusions, not only the headline price. See RFPflow.

Have a question we have not answered? Ask the Expert

Schedule a demo

See your contracts run on one record.

  • 1 A 30 minute walkthrough Built around your team, whether that is procurement, legal, IT or finance.
  • 2 Your contracts, not ours Bring a few sample agreements and watch Aavenir AI extract and review them.
  • 3 ServiceNow or standalone We show the deployment that fits the systems you already run.

Prefer to talk first? Contact the team.