Estimates give a rough idea of the cost. Quotes are generally a confirmed maximum price.
An estimate is not a fixed price. An estimate is the service provider's best guess of what the job will cost, based on their skill and past experience.
An estimate can be verbal or in writing — there is no legal difference.
Once you have an estimate and decide to use that supplier, it's a good idea to then get a written quote — especially if it's an expensive job.
A quote is an offer to do a job for a specified price. Once you accept a quote, the provider can’t charge you more than that unless you agree to extra work, or the scope of the job changes while it is underway. Legally, this is known as a variation to your contract.
It is worth checking if the business charges a fee to prepare a quote — they must tell you beforehand if they do.
Getting a quote or estimate
Get several quotes or estimates
If you can, get quotes or estimates from at least three businesses.
For each business, check:
- they are well established and have experience doing the kind of work you need
- if they are a member of a trade or retail association — this may give you a free and independent dispute resolution process to resolve problems, or extra warranties if the work is not done properly
- references from previous clients.
Ask for written quotes or estimates
Even if you are only approaching one business, ask for a detailed quote or estimate in writing so you have evidence if anything goes wrong.
When requesting quotes and estimates, provide as much information as possible. The more you give, the more accurate the results will be.
- any dates you need work done by
- whether you want a quote or an estimate
- that you want it in writing.
Tell each business you are getting others to tender — it's not just fair, but means they are more likely to give you a competitive price.
Compare quotes or estimates
Consider more than just price
When comparing quotes or estimates, don't just base your decision on price. You should also consider the service provider's:
- level of experience
- quality standards
- references and past projects.
You can always negotiate with your chosen business on price.
If your preferred service provider gives a higher quote, you can ask to negotiate.
Get enough information
The quotes or estimates should show:
- what work will be done
- any other costs, eg materials
- the hourly rate for the person or people doing the work
- how long the work will take.
Choose a service provider
If the quotes or estimates vary a lot in price, it is worth asking why. It could mean the business:
- has more experience
- is proposing using higher-quality materials
- is more realistic about how long the job will take
- has misunderstood the project.
When you have made your decision and chosen your service provider, you should let the unsuccessful businesses know.
If you have been given a fixed quote, the service provider must complete the work within the quoted cost, unless you agree to a variation.
There is no legal requirement for you to pay a deposit when you accept a quote. If you are asked to pay a deposit, don't pay more than 10% of the total cost.
If you were given an estimate but not a quote, the total cost should generally be within 10-15% of the original estimate. This means the service provider must carefully calculate their estimate, and must not set it too low on purpose.
If things go wrong
- you are charged more than you were quoted
- the cost is much higher than the estimate
- you think you've been charged an unreasonable amount.
First try to sort out the problem with the service provider: Remind them what you expected to pay. Show them the original quote or estimate.
Gather evidence and think about what you are going to say. Check what the business can and cannot do in Your rights above.
If you can't come to an agreement: consider taking your case to a disputes scheme, the Disputes Tribunal or District Court.
If you think you've been misled: you can report the business to the Commerce Commission.
The Commerce Commission enforces certain consumer laws, including the Fair Trading Act. They don't act on behalf of individuals and cannot investigate every complaint. But their investigations do help make sure businesses are complying with the law. Your information helps them assess which consumer issues are causing greatest harm.
Make a complaint(external link) — Commerce Commission
Get support at any point from:
- Citizens Advice Bureau (CAB) — a free, independent service, run by volunteers. CAB can advise you on your consumer rights and obligations, in person, by phone, or online.
- Community Law Centre — offers free one-on-one legal advice to people with limited finances. The organisation has 24 community law centres throughout the country. You can find legal information and other resources on its website.
Find a CAB(external link) — Citizens Advice Bureau
Our law centres(external link) — Community Law Centres
Example — Car repairs
Jenny hears a faint noise in her new car's engine. She asks her local garage to give her an estimate for any work that needs doing. After checking the engine, the mechanic tells Jenny she needs a new automatic transmission. He estimates it will cost about $2,000. Jenny agrees. When she picks up the car, the bill is closer to $3,000. Jenny queries it and finds out the mechanic did not include some repairs in the original estimate. She disputes the bill as it is vastly different to his estimate. If they can’t agree on a revised cost, she will have to pay the $3,000 bill, then make a claim at the Disputes Tribunal.
If you buy something expensive, eg a computer or a fancy watch, you may need to check and update your insurance.
Example — Quotes for painting
Eruini gets three quotes for painting the exterior of his weatherboard home. He chooses the cheapest painter to do the job. When he gets the bill, the painter has added an extra margin to cover travel costs. As this was not agreed in the quote, Eruini does not have to pay the extra portion of the bill.