How to Draft A Business Proposal

Crafting a well-written, solutions-oriented proposal requires diligence and extensive preparation.

Whether the economy is booming or the markets are in a downturn, standing out from the crowd is essential to growing a successful business. A well-written business proposal is a comprehensive communication of a company's value proposition, and is primarily a sales document designed to secure a client's business contract and tailor services to satisfy his specific needs. Drafting an exceptional business proposal is vital to earning the client's trust, enthusiasm and confidence.

Instructions

1. 

   In-depth research is the most vital element in determining the quality of a business proposal.

   Perform extensive background research. Every successful business proposal depends on a foundation of understanding and catering to the specific issues a prospective client is facing. Browse online and offline news sources, including blogs and industry journals, to capture an in-depth understanding of the client's current position in his market. Meet with those who will be making the ultimate decision on the contract and ask specific questions to determine the problems they are attempting to solve, the outcomes they want to accomplish and the goals they hope to achieve. Make as many contacts and ask as many detailed questions as possible.

2. 

   The cover letter is of great importance, as it is often the first document the client will read.

   Draft a cover letter. A cover letter, sometimes referred to as a letter of transmittal, is a one-page introductory document that provides a brief overview of the proposal; how your firm qualifies and deserves the client's business; the proposed price for the project; and an explicit request for selection to complete the proposed tasks. Ensure the letter has a professional and direct tone and contains any critical information the client may need before exploring the details of your full proposal.

3. 

   These organizational documents give your business proposal increased utility and a professional appearance.

   Create a title page, table of contents and executive summary. The title page should clearly identify you and your organization, the client and the date of the proposal submission. Larger and more complex proposals require a table of contents that assists the client's navigation of the proposal and allows the examination of specific sections -- such as Hardware, Schedule, Landscaping or Financing -- by his respective department representatives. The executive summary is a one-paragraph explanation and reiteration of the proposal's key points, and may include information previously given in the cover letter.

4. 

   A client must have absolute confidence that you truly understand and identify with the problems they are facing.

   State the problem or issue that requires addressing. This section of the proposal is where your background research pays its dividends. Explain the problem the client is attempting to solve or the goals they are striving to accomplish in simple, concise terms and showcase your comprehensive understanding of the clients needs and aspirations. If you cannot accurately define the issues at hand, the client has no reason to read the rest of your proposal and you will not secure his business.

5. 

   Include just enough detail to inspire confidence without losing sight of the bigger picture.

   Present your solutions. Outline your "big picture" strategic approach to solving the problem by presenting the resources you possess and how they specifically address and solve the client's problems. This section presents your competitive advantages and outlines the assets that differentiate you from the competing bidders. Dictate your plan of action and the specific methods you will use to execute your strategic approach.

6. 

   In business, time really is money, so create a project schedule that uses time wisely.

   Create a time line for your plan. Most clients will have an expected or required completion date for the proposed project, and you must create an aggressive, yet realistic schedule for your proposal. Competitive markets demand fast and frequent innovation, and showing the prospective client you can take his project to market faster than the competing bidders can be a critical advantage. Create a detailed schedule that ties operational tasks to strategic objectives, and identifies specific benchmarks to measure and evaluate progress.

7. 

   Include as much quantifiable data as possible to provide powerful evidence of your success.

   Identify your qualifications. Much like a cover letter and resume for a job application, this clearly presents why you are the right person or company to satisfy the client's specific needs. Showcase your past successes with similar projects, and include references to mutual clients you and your prospective client completed work for. Include specific, quantifiable results to bolster your claims, such as "We reduced our client's operating costs by 40 percent and increased the division's annual profits by 60 percent." Do not be afraid to sell yourself or your company, the business proposal functions to make you stand out above the competing bidders, and touting your previous accomplishments is a powerful tool.

8. 

   Price negotiation is a part of doing business, so have a plan and set a discount limit.

   Outline the proposed costs. Although strong past performance and a promise of quick delivery are critical factors, the client will ultimately decide whether or not to accept the proposal based on the price. Include labor costs, material costs and legal costs, if necessary. Propose a price that adequately rewards your market value while ensuring your client receives a fair deal that corresponds with the services and results he will receive. Outline the specific schedule payments -- based either on elapsed time or upon completion of certain project tasks. Prepare yourself for possible negotiations on the price based on other bids the client receives and be open to small discounts or adjustments. A project awarded at a 5 percent discount is better than losing the contract entirely.

Tips & Warnings

• Visual tools such as graphs, charts and diagrams that enhance and support your data add immense value to a business proposal.

References

• "Inc."; Business Proposals; Sharon Berman
• Reference for Business: Business Proposals

Resources

• Read this Article in Spanish