How Much Are Free Estimates Costing Your Business? (Calculator Inside)

You drive 35 minutes to a job site. You spend an hour walking the property. You go back to the office and spend two more hours writing up a detailed, accurate quote. You send it. You follow up twice.

They go with someone else.

That is not bad luck. That is your business model.

Most contractors give free estimates as a reflex. It feels like the cost of doing business. But when you actually run the math, the number will probably surprise you.

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The Real Cost of "Free"

According to FreshBooks, a free quote can cost a business more than $200 in time and resources, and that is for smaller jobs. Once you add site visits, material research, subcontractor calls, and proposal writing for a larger project, that number climbs fast.

Break it down:

| Activity | Time | At $75/hr Effective Rate | |---|---|---| | Initial call + scheduling | 20 min | $25 | | Drive to site (round trip) | 45 min avg | $56 | | Site walkthrough + measurements | 60 min | $75 | | Proposal writing + pricing | 90 min | $112 | | Follow-up calls/emails | 30 min | $37 | | Total per estimate | ~3.5 hrs | ~$305 |

That $305 is gone whether you win the job or not.

And here is the kicker: most contractors win only 1 in 5 to 1 in 10 jobs they bid on.

Redwood Construction Group, a premium remodeling firm, put it bluntly in their own analysis: contractors have to estimate 5 to 10 jobs for every 1 project they win. They cited this as the primary reason they stopped offering free estimates entirely. Every one of those unrecoverable estimates gets quietly baked into the prices of the jobs they do win.

Someone always pays for the free estimate. Usually it is you.

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Run Your Own Numbers

Before you read another word, go see what this is actually costing you.

Use the Free Estimate Waste Calculator at godigitalapps.com. Plug in how many estimates you give per month, your average time per estimate, and your close rate. The calculator shows you your monthly quoting cost and your true cost-per-acquired-job.

Most contractors who run it are looking at $2,000 to $6,000 per month in estimate overhead. Per month.

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Why Your Close Rate Is the Real Problem

The contractor quoting waste conversation usually focuses on time. That is the wrong lever.

The real variable is close rate.

Industry data on contractor conversion rates breaks down like this:

• Free estimates: 15-25% close rate on average
• Pre-qualified consultations: 60-70% close rate
• Yelp research found that 70% of homeowners hire the first contractor who responds to them

That last stat seems to argue for giving free estimates as fast as possible. But it does not. It argues for being first with the right leads.

Here is what happens when you chase speed over qualification:

A contractor in a LinkedIn case study drove 42 minutes to a "small kitchen refresh" lead. The prospect wanted a full gut renovation but had a $15,000 budget for a $65,000 job. The contractor spent half a day. The lead went nowhere. The real cost of that interaction, including lost billable time and follow-up, came out to over $9,000 in opportunity cost.

That story repeats itself across the trades every day.

A 2025 FIELDBOSS survey found that 49% of HVAC service leads are unqualified. A study cited by Douglas Digital Agency found that up to 40% of all plumbing leads result in wasted time and revenue due to poor qualification. Contractor Scale's 2025 industry report found that 73% of home builders and remodelers fail at lead qualification entirely.

When you quote unqualified leads, you are not just losing time. You are giving away detailed scopes of work to people who were never going to hire you, and sometimes they take that work to a cheaper competitor.

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What Qualifies a Lead Worth Quoting

Not every lead deserves an estimate. These are the questions that separate real prospects from time sinks:

Budget: Do they have a realistic number in mind? If they cannot name a range, that is a red flag. Serious buyers know roughly what they are prepared to spend.

Timeline: Are they planning to start within 90 days? "We're thinking about it for next year sometime" is not a qualified lead. It is a contact for your nurture list.

Decision authority: Is the person you are talking to the one who writes the check? Quoting to someone who still has to "run it by" a partner or board adds a full cycle to your sales process, with no guarantees.

Scope clarity: Can they describe what they want clearly? Vague projects generate change orders and margin erosion. They also take twice as long to quote.

Prior bids: How many other contractors are they talking to? Three or more is a race to the bottom. One or two is a real buying conversation.

If a lead cannot clear those bars, they should not get a full estimate. They should get either a ballpark range over the phone or a paid discovery consultation.

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Qualify Before You Quote

The contractors who win more with less bids are not guessing. They have a system.

The Contractor Lead Qualifier at godigitalapps.com walks you through the exact questions to ask before you roll a truck or open a proposal template. It scores each lead on the key variables and tells you whether to pursue, ballpark, or pass.

It takes about three minutes to run a lead through it. It saves you the three hours you would have spent quoting a dead end.

Contractors using a qualification system before quoting report a shift from 20% close rates to 40-50%. That is not magic. That is math. When you stop wasting proposals on people who were never going to hire you, your close rate on the remaining leads goes up automatically.

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The "Free" Estimate Is a Competitive Disadvantage

There is a psychological cost here that does not show up in any spreadsheet.

When you give something away for free, you train people to treat it as worthless. A homeowner who got a free estimate from three contractors learns that contractor time has no value. They comparison shop. They negotiate each line item. They use your scope of work to buy materials at Home Depot and hire a cut-rate crew.

Michael Stone of markupandprofit.com put it this way: "Free only attracts people who are looking for something for nothing. That's not why you're in business. You're in business to provide a service and make a profit doing it."

The contractors who have moved to paid discovery calls or paid pre-construction agreements consistently report a better class of client. Not because the fee filters out people by income. Because it filters people by seriousness.

A client who pays $150 for a discovery call has skin in the game. They are not shopping you against three other bids. They have already chosen you as their contractor. The consultation is just formalizing it.

Many contractors structure this as a credit: the discovery fee applies to the project if the client moves forward. It costs the committed client nothing extra, and it weeds out every tire-kicker before they waste your afternoon.

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Fix Both Sides of the Problem

The quoting waste problem has two sides. Most contractors only try to fix one.

Side one: You are giving too many estimates. The Estimate Waste Calculator shows you the dollar cost of your current volume. Once you see that number, you cannot unsee it.

Side two: The estimates you give are going to unqualified leads. The Lead Qualifier fixes that by giving you a structured process to run every inquiry through before you commit your time.

Together, they close the loop.

• Calculate what your free estimates are actually costing you
• Qualify your next lead before you spend an hour driving to a dead end

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The Contractors Who Win More Work Less for It

The data is not ambiguous. Contractors who pre-qualify leads and charge for detailed consultations close at 60-70% instead of 15-25%. They do fewer estimates. They win more jobs. They do less administrative overhead per dollar of revenue.

The "free estimate" model works when you are new, when you are building a reputation, when you need volume to learn your market. It stops working the moment your time becomes a real constraint.

If you are reading this, your time is already a constraint.

The question is whether you are pricing that time accordingly.

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Run the numbers on your business: Free Estimate Waste Calculator | Contractor Lead Qualifier

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Sources: FreshBooks, "Are Estimates Free?" | ClearEstimates Blog, "The Truth About Free Estimates" (April 2025) | Redwood Construction Group, "Why You Don't Want a Free Estimate" (April 2023) | FIELDBOSS 2025 HVAC Industry Survey | Douglas Digital Agency, "The Real Cost of a Bad Lead for a Plumbing Company" (July 2025) | Contractor Scale, "Construction Lead Generation Ultimate Guide" (November 2025) | Google AI Overview: Contractor Estimate Statistics 2025-2026