So you’ve found a great opportunity to sell your product or service, but your potential client wants a business proposal. What is a business proposal and how do you write one that makes sales? Read on to find out.
What is a Business Proposal?
A business proposal is a document you send to a potential client to convince them to buy your product or service. They are sent from one business to another (B2B). Sometimes businesses will solicit proposals with a “request for proposal”, also known as a “request for quotation” or an “invitation for bid”, but it’s also common to send proposals unsolicited.
A business might write a proposal to:
- Win a contract that has multiple bidders
- Pitch products to a retailer
- Apply for funding
- Gain a new supplier
- Collaborate with another similar business
A business proposal is different to a business plan, which is a single document that explains your company’s vision, mission and plans.
What Makes a Good Business Proposal?
A good business proposal lays out the client’s problem, how you will solve it and why your company is the best for the job. You should take time to research the company you’re pitching to and tailor your proposal to their needs. Business proposals aren’t too different to job applications: your aim is to show that you are the most capable and compatible business for the task at hand.
Your proposal should be specific: explain exactly what you will do and estimate time and costs where possible. As a business owner, you know that time is valuable — so save your client the time of asking.
Before you start to write a business proposal, you should consider:
- What are the key points the client is looking for?
- Has the client has already tried to solve the problem? If so, why didn’t they succeed?
- Does your product or service fit with the client’s values?
- What concerns might the client have with your proposal?
- What challenges might you face?
How to Write a Business Proposal — In 10 Steps
Some businesses will ask for proposals to be formatted in a specific way; if this is the case, be sure to follow the requirements, or your proposal might be ignored completely.
In most cases, proposals follow a fairly standard structure. We’ve summarised this into bullet points that you can use as a template for your own business proposal.
1. Title page
First impressions count, so format this nicely and include your branding. Include the project name, your business’s name, the company you are submitting the proposal to and the date.
Before you start digging into the main proposal, introduce your business and its values. Talk about similar projects you have completed and any notable clients. Keep this short and sweet: enough to give a good impression and encourage the client to keep reading.
3. Executive summary
This is a neat, digestible summary of the document: you might want to write the proposal first, and then come back to summarise it. Include the key takeaways, including a brief overview of the client’s problem and your solution, but don’t try to summarise every point.
4. The problem
Describe the situation at hand, breaking it down into smaller points and looking at the bigger picture. It’s likely that the client’s problem is one that affects others in the industry. Include relevant statistics, remembering to cite them in your footnotes.
5. The client’s requirements
Here’s where you show that you understand the client and their specific needs. If you’re responding to a request for proposal, be sure to use all the information they have given you. Keep the tone positive: you’re presenting opportunities, not pointing out issues.
Now it’s time to outline your solution. Describe your solution, strategy and goals with the project. Give a detailed methodology, explaining each step and why you are approaching the situation this way.
7. Why your business is the right choice
Show that you are experienced and capable of carrying out your proposal by writing about your skills and experiences. Discuss prior projects and existing clients, including relevant case studies and testimonials where possible. Introduce your team and their strengths, as well as other selling points such as specialist equipment.
Give your proposal dimension by offering an estimated, realistic timeline for the entire project, from signing off on the proposal to completion.
9. Pricing and contract terms
Give a quote for your work, breaking it down into smaller parts such as startup costs, materials, labour and monthly charges. It’s better to overestimate slightly than to give an unrealistically low quote. Lay out contract terms such as deposits, late payment penalties and cancellation policies so that you’re protected and the client knows what they’re signing up for.
10. Call to action
Round out your proposal with a call to action, inviting the client to reach out and ask you any questions.