i don't know if you guys are in the same line of work as me, but at the end of calculating a quote, the profit is added at the end as a percentage.
on a smallish extension, say £12,000, the profit may have to be as much as 20%.
on a larger job, say £50,000 it could be as little as 10%.
the profit margin is dependant upon difficulty. if a job involves a lot of alterations to the existing property, then it is highly likely the job will be time consuming. similarly, a job largely involved in new-build is fairly straightforward.
for this particular customer it was only the profit margin that was altered, and it was a job that was rich in new work, i.e. single storey extension, using an existing window as the knock-through. i was not at all nervous about reducing the cost, so long as the customer was aware that i had the freedom to increase costs where necessary.
i agree, it is important to be professional at all times and to be on your guard. i have even done pro bono work for charity run institutions. i could not do free work all year round, but i will help where i can. i was not asked to work for free, i simply never sent the charity group a bill.
i do earn a decent crust for most of the year so a little charity once a year helps keep me 'on the good side'.