An estimate predicts what a job will cost to deliver. Price is set from it; it is not itself a price.
What it is built from
Labour, at full labour cost rather than the wage, for the hours the work genuinely takes including setup and travel.
Materials, at current prices with an allowance for waste.
Subcontractors, quoted rather than assumed — see subcontractors.
Equipment hired or consumed, permits, and disposal.
A share of overhead, because the job has to contribute to the costs that run whether or not it happens.
Profit is then added. It is not what is left over.
Contingency
An allowance for what is not visible at the estimate. It is legitimate and should be deliberate: a stated percentage on work with known unknowns, rather than a figure quietly inflated everywhere.
The feedback loop
An estimate is a guess until it is compared with the job's actual cost. That comparison is job margin variance, and without it estimating never improves, because nobody learns which assumptions were wrong.
Persistent under-estimation of labour is the most common pattern, and it is invisible without the comparison.
What it is not
A quote is a committed price. An estimate is a considered prediction that may move. Which of the two has been given changes what the business is obliged to do, and it should never be ambiguous to the customer.
Speed against accuracy
A slow estimate loses work — see improving close rate. A fast one built on nothing loses money. The resolution is standard costs for repeatable work, so that speed comes from preparation rather than from guessing.