Understanding the basics of a business proposal
When it comes to gaining the trust (and wallet) of a potential client, business proposals are an entrepreneur’s magic wand.
Every business was created to solve a problem. And every problem-solving endeavor begins with a good “pitch” or proposal. So, proposal writing is something that you must master if you want to have a leg up on your competition in business.
What is a business proposal?
A business proposal is a value proposition on paper.
- What you bring to the table
- What you can do to solve another business’s problem
- How you plan to solve that problem
- The fine print of solving the problem (i.e., compensation, time elements, other assets needed to complete the work, etc.).
The first thing you have to understand is that writing one isn’t so much of a science as it is an art form. And, art is subjective. What one potential client might see as a great proposal, another client might disregard. So while there are basic guidelines and components that should include in any proposal, which we’ll discuss later on, every proposal must also have its own level of creativity.
A note about RFPs
Often companies will release what’s called an RFP, which means “request for proposal.” This is when a company has a problem that needs to be solved, and they’re inviting people to submit a proposal explaining how they’re going to solve it.
That company will then sift through these submissions to weed out unqualified applicants.
On many project marketplaces, such as Upwork, you’ll see RFPs (which can sometimes be called by another name) where a client will create a project query and then allow applicants to compete for the job by writing a solicited proposal. The RFP process is also extremely common for government agencies looking to fill government contracts, as well as in the private sector when a company is seeking a new vendor such as an advertising agency.
Curious about how you can win RFP’s? Read more about how to submit killer RFP responses in this post.
As there are many types of RFPs, there are even more types of proposals so let’s explore a few.
Other types of proposals
One popular type of proposal is a grant. Grant writing involves crafting a proposal to receive funding for a business or cause, as opposed to offering a service.
Then there’s what’s called an RFQ (request for quotation), where a company allows vendors to offer a competitive price and bid for the completion of a specific project. RFQs are written similarly to an RFP. Sometimes an RFQ is an attachment to the RFP.
An RFI (request for information) is exactly what it sounds like. This is when a potential client requests more information about what you bring to the table so they can decide if they want to go to the next level of sending an RFP your way or not.
There’s also what’s called an “unsolicited proposal,” which is when someone sends out a proposal to a company that didn’t request it. These kinds of proposals are the way many entrepreneurs gain new business.
The goal of creating an unsolicited proposal is to notice a missing element or problem a business has and pitch yourself as the one who can solve it.
Think of it as a cold call or conversation at a networking mixer with a client you’ve always wanted to work with. The objective is to introduce yourself, your value, your knowledge of that individual’s business, and what you can do to be an asset to their overall objective. The only difference is that in a business proposal, you’re using the skill of writing as opposed to talking.
Most business people can become terrified by the idea of having to write a proposal because it tends to feel more formal and rigid than conversation. But there’s no need to be. There are numerous ways to write this kind of pitch to win a potential client’s attention, and ultimately, their trust and business.
Tips and strategies for creating your first business proposal
As already mentioned, writing a great business proposal is an art: not a science. So this means that as varied as business plans are, the same can be said for business proposals.
Every potential client has their own unique personality and voice, so good a proposal will mirror that – while still expressing your personality as an entrepreneur.
Acclaimed life coach Tony Robbins once popularly stated that “mirroring” is the way to build rapport with people and help them feel as if you truly understand them. Keep this in mind when pitching a company your services.
The first objective of writing a proposal isn’t landing a new client – it’s standing out from the crowd. A proposal is essentially a sales pitch. The first rule of getting a sale is getting the potential buyer’s attention. To get the client to take action and “buy” what you’re offering, there are some key things to do first.
1. Study The Client
The quickest way to ruin your chances of having a great proposal is by not doing homework on who the client is so that you’re very comfortable with what you’re pitching. This requires research, but it’s worth it. How can you meet the need of that client if you don’t know the main objectives of their business?
How can you make an emotional connection with that client, and cause them feel secure hiring you if you don’t know how their need relates to the objective?
So, do your homework. Here’s a quick pre-proposal homework checklist:
- Visit the client’s website; check out some videos, read some articles, and study what that client’s brand stands for. This one step alone will cause your proposal to stand head and shoulders above the competition.
- Take a look at their social media content, if they have any. This will help uncover exactly what tone and messaging the client uses when talking to their customers.
- Dive into what it is they’re selling and how they position their offerings.
- Do some cursory research into the audience they serve. What are the pains, desires, or challenges that this audience faces and how do those emotions contribute to their choice to buy from your prospective client?
- Skim a few of the prospective client’s competitors’ websites to understand how they’re different from your prospective client.
Once you understand a potential client’s business, you can infuse that knowledge into your proposal to help them recognize you’ve done your homework and put in the effort to understand them.
2. Gather your bragging rights
Because you’re more-than-likely competing against other applicants hungry for that client’s attention, it’s important to pluck off the other suitors by letting the client know why you’re the greatest.
A client chooses people to handle a task based on the value they provide. That potential client wants to know they’re getting their money’s worth with you and choosing the right person to do the best job. Therefore, you’ll need to pull out all the big stops if you want to create a winning proposal. This includes detailing prior outstanding results on similar projects, testimonials from satisfied past clients, and other proven know-how that can be included.
Also, be concise in with the proposal. If what you present is too long-winded, you’ll risk the client’s attention and winning the job.
3. Explain How you can solve the problem
Everything we’ve touched on so far culminates in why you must do your research and provide information on your proven and praised abilities: because you want to show the client that you will solve their problem.
One piece of advice any great salesman can give you about a great sales letter is a sales letter talks to the potential client, not at them. So, consistently address the client’s need as if you’re talking directly to them. Give them a sample of what you plan to do.
A word to the wise: many people go overboard with the bragging rights and never get around to showing the client they understand what the need is, and how they can solve it.
A potential client needs to feel confident you understand what their need is, so make sure you find a way to restate that need early in your proposal, to keep the client engaged with the rest of what you’re saying.
4. Include a call to action
It’s easy for one to assume that the fact they’re writing a solicited proposal is an automatic call to action, but that’s not the case!
So, boldly state your desire to take the conversation further: this is the call to action or CTA. For example, to shorten your sales cycle, your CTA might actually be to request an eSignature to initiate the project.
The call to action is a clear, concise statement that compels the recipient to take the next step in the consideration process. Figure out the appropriate call to action for that particular client and project, and end with it.
Basic template for writing a business proposal
Here is a basic format for structuring a proposal. (Looking for a more in-depth look at the components of a winning proposal? Check out our recent post about the specific components to include.)
Please note that some companies will state a required structure in their RFP, so follow that (to a T!) if they do.
1. State the client’s need.
A proposal is a conversation. If you’re talking to someone who had a problem, the first thing you’d do to put that person at ease is to repeat back what they said. This helps the listener feel validated and understood.This is how you’d want to start a proposal. Don’t try to sell yourself without first ensuring that the potential client knows that you’ve understood what they said in their RFP, or what their needs are in general (if it’s an unsolicited proposal).
2. Summarize the solution.
In the next section, explain to the client, as concisely as possible, the plan to solve their problem.This part is where you’ll want to show credibility by including similar prior work that produced great results. Give the clients a written appetizer of the steps you’ll take to get the job done.Feel free also to include what you would need to get the job done – this shows you fully understand what it takes to get it done, and isn’t just talk.
3. Call to action.
Don’t ever leave a client hanging. After providing the above elements in your proposal, keep that client’s attention by inviting them to discuss things further. This could be as simple as including a prompt to sign on the dotted line. And don’t forget to follow up with a reasonable amount of time, again compelling the prospective client to continue the conversation.
Bring your own style and creativity to proposals. Even more importantly, a successful proposal requires an aptitude for understanding the problem that the client is looking to solve so make sure to speak directly to this challenge within your proposal and you’ll be well on your way to winning a new client.