Many new business owners and contractors wonder, “Can an estimate be used as an invoice?” The short answer is no. An estimate and an invoice serve two separate functions and can’t be used interchangeably. But wait! Before you leave this blog and enter a frustrating loop of copy-paste, there are easier ways to solve the problem. Let’s take a closer look at the differences between estimates and invoices, and how the right software can help you easily convert estimates into invoices with the click of a button.
An estimate (sometimes called a quote) is a document provided at the beginning of the project to summarize the work to be done and the estimated cost of the work. The purpose is to help the business owner and customer properly align expectations for the project, and they’re often used to help sell customers on why they should use your business as their service provider. An estimate is only legally binding if the customer approves it, which is typically done with the customer’s signature either physically or electronically. The customer’s approval provides the green light to schedule the project and perform the work. Now that you know what an estimate is, let’s answer the all-important question, “What is an invoice?”
An invoice, on the other hand, is a document provided at the end of a project when all the work is completed. In larger projects, invoices can be broken into several invoices paid at the end of key project milestones. The primary purpose of an invoice is to notify customers that a payment is due. An invoice is a formal request for payment that includes payment terms and is an important document for maintaining bookkeeping and tax records.
See: How to Create an Invoice for Home Services
Now for the exciting part: The best way to convert estimates into invoices! By understanding what is an estimate and what is an invoice, you may be asking, “Is there an easy way to convert estimates into invoices?” Though quotes and invoices can’t be used interchangeably, you don’t have to spend your time tediously copying and pasting information from your estimate template to your invoice template. The truth is, there is a lot of crossover between what’s shown on an estimate and on an invoice. Both tend to display information about your company, an itemized list of work, and a total price or amount due.
With software like Project 2 Payment, you only have to enter each data point once, and then sit back and enjoy watching the tool create any document you need with just a few clicks.
Let’s face it, as the owner and operator of a home service business, it’s impossible to stay on top of your workload without a little help. With Project 2 Payment, estimates and invoices are automatically branded with your logo and business information, so you can look organized and professional without any extra effort.
Each estimate is automatically created and formatted for you with the information you select through our easy-to-use estimate creation workflow. Estimates and invoices are emailed directly to your customer instantly, with no more waiting two days for standard snail mail services to deliver to your customer’s residence. Project 2 Payment also allows customers to pay instantly upon receipt of an invoice with payment options including card, eCheck, or even paper cash or check, if you collect on-site.
Ready to look like you’ve mastered the estimation, invoicing, and payment process? Sign up now and get your first 30 days free.