How to write a quotation for supply of goods to a company, with a worked example

Most weak quotations fail before the first number is typed. The supplier skims the request, prices what they think the buyer wants, and misses a detail that the buyer treats as a must.

Read the whole RFQ once without pricing. Write down the closing date and time, the delivery place, the units for each line, the validity the buyer wants, the payment terms, and the attachments they ask for, such as data sheets or certificates.

Then mark what is unclear. A missing size, a brand name with no "or equal", or a delivery date that does not fit your supply chain are all questions to ask. Send them early, in writing, to the contact named in the RFQ, and keep the answer with your file.

If you cannot supply a line, say so on that line. An honest "not quoted" is better than a guess that fails at delivery.

Start each line from your full cost, not from the price you charged last time. Full cost means the purchase or production cost, inbound freight, any customs or handling, packing, and your share of delivery to the buyer's site.

Then add your margin. Decide whether you think in margin on price or markup on cost, because the two give different numbers for the same percentage. Our separate guide on profit margin for supply quotes shows the difference with an example.

Check two risks before you fix the price. First, the validity period: if your own supplier can change prices within that time, your margin must cover it. Second, the payment terms: if the buyer pays 60 days after the invoice, your cash is tied up for that time.

Write the unit price to two decimals and keep the line total as quantity times unit price, nothing hidden.

Here is a worked example with fictional figures. Line 1: 40 units at SAR 250 each, so SAR 10,000. Line 2: 10 units at SAR 1,200 each, so SAR 12,000. Delivery to the buyer's site: SAR 500.

Total before VAT: 10,000 + 12,000 + 500 = SAR 22,500. VAT at 15%: 22,500 x 0.15 = SAR 3,375. Total including VAT: 22,500 + 3,375 = SAR 25,875.

ZATCA's guideline sets the VAT rate at 15%. In this example the delivery charge is treated as part of the taxable supply; check with ZATCA or your accountant for your own case.

Show all three totals on separate lines. Procurement teams compare offers before VAT, and finance teams pay the total including VAT, so both need to see their number at once. If you quote in another currency, remember that the tax amount on the tax invoice that follows must be in Saudi riyals.

Validity: give a clear period, such as 30 days from the quotation date, or the period the buyer asked for. For comparison, government competitions under the new procurement law keep bids valid for 90 working days, which is long for a private supplier with moving costs.

Delivery: state where you deliver and how many working days after the purchase order. If lines arrive at different times, give each line its own date.

Payment: write the terms you offer, such as 30 days from the invoice date. If the buyer pays an advance, plan the paperwork: ZATCA's guideline says a tax invoice for an advance is due within 15 days from the end of the month you received it.

Exclusions: list in one or two lines what the price does not cover, such as installation, offloading by crane or site permits. Short, clear terms prevent arguments after the PO.

Put everything in one document with your legal name, CR and VAT numbers, the buyer's RFQ reference, a quotation number and date. Our quotation template lists every field with an example. Sign it, stamp it, and save it as a PDF named with the quotation number and the RFQ reference.

Send it through the channel the buyer asked for, before the closing time. Then ask for a short confirmation that it arrived. A quotation that sits in a spam folder has the same result as no quotation.

Follow up once, politely, a few days before the decision date, and offer to answer questions. If the buyer chooses another supplier, ask what decided it: price, delivery time or a missing document. Keep a simple log of each quote and its result, so your next price is based on facts, not on memory.

On ENTEK, suppliers can submit invoices and generate stamped commercial documents: quotation, proforma, commercial invoice, packing list, COA, MSDS/TDS and contracts. The stamp, CR and VAT numbers come from your verified company profile.

When a corporate buyer sends an RFQ on ENTEK, you can submit bids and negotiate in rounds, with delivery options per line, and get purchase orders when you win. On orders, you can quote delivery and let the buyer choose. You can also track win rate and response time for your RFQs, which turns step 5 into a habit.

What ENTEK does not do: it does not price your goods for you, it cannot promise that a buyer will accept your quotation, and an ENTEK quotation is not a tax invoice. Use a ZATCA-compliant e-invoicing solution for your tax invoices.