Contracting Money Terms to Know

Contracting Money Terms to Know

Shopping around for a contractor? We know the process can be stressful – there’s a lot to research and think about. You want to hire a quality worker who is licensed, insured, and honest. After you’ve narrowed your search down, you want to start discussing with these contractors the scope of your project and the potential costs.  When dealing with money, there’s a few different terms used: bid, quote, estimate, and proposal. Do you know the difference? If not, we’re here to help.

We’re a Florida contractor licensing company and we help thousands of people get their contractor licenses, so we know this business well. For this article, we wanted to explain these words to you, so if a contractor says them, you’ll know exactly what he is referring to.

Bid – A bid is something submitted to a general contractor by a subcontractor to do part of a project. Abid also refers to a document that offers to do a job at a certain price in a certain time frame.

Quote – A quote is a number the contractor will give you based on numbers from a supplier regarding materials. A quote is usually only good for about a month. After a month, the cost of supplies will change as prices for materials fluctuate due to supply and demand.

Estimate – An estimate is a combined total of the materials and labor to complete a project. An estimate can also include taxes, overhead, subcontracts, equipment, and more. Most estimates are free, but some contractors charge because it takes awhile to put together a good estimate.

Proposal – A proposal is a thorough, detailed document that is submitted to win business. In the proposal, there are quotes and estimates that include price of materials, labor, subcontractor costs, taxes, overhead, and more. A proposal can be a contract if there is a place for the customer/client to sign.

Once you know the difference in these terms and words, you will be able to understand what your contractor is doing and what he will be giving you.

 

Looking to get your contractor’s license? It is a rewarding career and the job market in this industry continues to grow each year. There is a need for licensed contractors, especially with the many natural disasters that occur each year.

We are a contractor licensing company who help contractors all over the country get their licenses. To get your Florida contractor’s license or other state license, click our Florida contractor’s license page or call us at 239-777-1028.

 

 

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