A business proposal is a written outline that specifically details a transaction between a business and a prospective client. A client may request proposals from many different companies in order to see which business offers the best price, quality, and timeframe. A proposal is an important part of any business' efforts to acquire new clients.
A project proposal should list the services that can be done and how long the expected project will take. An estimate can also be included. This doesn’t need to be 100% accurate, as it is not a formal offer or contract, but it should be well-researched. This information will help the buyer make their decision regarding the winning proposal.
A business proposal template is often the first step in what is known as a complex sale – any sale where the buyer must consider more than just price in purchasing. In an investment situation, the business proposal template will need to include anything that the investor might need to know before deciding whether or not to invest. It should also include anything that might convince the investor that the joint business venture is a worthwhile endeavor. This might include: a detailed explanation of the business venture you’re proposing, the amount of capital you anticipate needing, any research you’ve done that pertains to that particular market, and any additional information and investor wants before coming to a decision.
There are two basic types of business proposal – those that are solicited by the buyer or client, and those that are submitted to potential buyers even though they haven’t requested one. Both types of proposal are important; the solicited proposals, however, give you a chance to communicate and include information that is tailored to the specific job.
The terms business proposal and business plan are often used interchangeably, but it’s important to remember that they are, in fact, not the same thing. A business proposal offers a service or product to the potential client. A business plan, on the other hand, is a more formal document that may be part of a business proposal. The business plan sets out certain goals for the business interaction, and how those goals would be achieved.
If you’re new to business proposal writing, it’s wise to look over several business proposal samples online. When you go through business proposal samples, take note of what works – and what doesn’t – in the proposals other have written. When a proposal is well-written, comprehensive and presented confidently, the result is often a successful sale for both sides of the equation.
In some industries, a business proposal has a well-defined format that is specific to that industry. For example, in professions such as architecture and advertising, a visual presentation is the norm. However, most general business proposals will have the following structure:
To write a successful business proposal, follow these steps:
1. Gather the Information You Need
If you are responding to a request for proposal (RFP), read the RFP carefully. Make sure that you meet all of the requirements that are specified by the client.
Learn everything you can about the client and project to help you customize the best possible proposal. You may want to have an initial meeting with the prospective client before sending a proposal. In that case, you would send a cover letter thanking the potential client for meeting with you and attaching the proposal.
2. Outline the Scope of the Project
Before writing the proposal, think about the project. Reflect on the key people who will be involved in the project and the things that will need to happen to complete the job. Who will do the work and manage the project? Who will the customer call if there are problems? What work needs to be done? When will you begin work and when will it be complete? When is payment due? How will the work be complete? Why have you chosen the approach to complete the job? Knowing the answers to these questions will help you write your proposal.
3. Estimate Labor and Costs
Think about how many hours you will need to spend on the project. Many businesses use a simple formula to estimate labor costs. First, add up the realistic amount of hours that it will take to complete each task on the project. Then multiply that number by 1.5.
Adding in this extra time will help to account for the different things that may go wrong during your project. If everything goes smoothly and you end up using less than the estimated amount of hours, you could always bill the client a lower amount or offer extra work as a bonus.
Begin by identifying the problem that your potential client has. If necessary, explain any context that the reader will need to understand the proposal. Define any key terms and then offer a roadmap of the proposal.
Tell your reader how you intend to solve their problem. Your solution will typically be the goods or services that you are offering to your client. Explain the benefits that your solution offers. Justify your expected benefits with evidence.
Explain your timeline for when tasks will be completed. Lay out important milestones. Explain that your timeline is an estimate and may be subject to change based on other factors.
Include a conservative budget estimate about how much the project will cost. When you are calculating costs, make sure to remember to include: start-up costs, labor costs, materials costs, monthly fees, maintenance costs.
Explain key contract terms. Be sure to include information about deposits, penalties or interests for late payments, and cancellation policies.
5. Edit Proposal
Once you have written your proposal, set it aside for a short period of time and then review it. Reread it for accuracy, spelling and grammar. Pay close attention to the dates and numbers you’ve included in your proposal to make sure they are correct. Review the RFP and any other correspondence with the potential client to ensure that you’ve included anything that the client asked for.
If possible, ask another person to review the proposal. A second set of eyes will help catch errors that you did not notice. Make sure that the language of your proposal is professional and clear. Be sure that your proposal is short enough to read in a single sitting. A good proposal should take less than eight minutes to read.
6. Send Proposal and Follow Up
Once you’ve sent the proposal, you should follow up with the client to remind them about it and answer any questions. If you’ve sent the proposal by email, you can choose to receive a notification when your potential client opens your message. Follow up with them the next day to see if they have any questions.