Learning how to write a business proposal is critical to winning new business. In this article, you will learn how to start a business proposal, how to write a business proposal effectively, and how to conclude a business proposal with a persuasive ending.
Mastering how to write each of these business proposal areas will help you deliver a well-structured, well-defined solution for your RFP response. We want to make sure you have everything you need to be successful. Several other areas will be addressed as you read including how to understand the customer, how to evaluate your competition, and how to leverage the right resources to finalize the business proposal prior to deadline.
What is a business proposal?
A business proposal is a solution-oriented document that organizations write in response to a request for proposal (RFP). External organizations and government agencies will solicit RFPs to procure resources for a project or need that they cannot fulfill with internal resources only.
Organizations that receive and respond to the RFP – bidders – submit business proposals to bid on the opportunity to win the business contract. A business proposal contains specific and detailed information including an Executive Summary, Technical Proposal, Cost Proposal, and supporting information like Terms of Agreement and attachments.
How to Start a Business Proposal
Truthfully, gaining new business begins well before an RFP is released. Think about how any other agreement happens. If someone knows you, they are more likely to be receptive to what you have to say or offer. External organizations are more likely to choose partnership with companies that are familiar and offer the right solutions. It is recommended that you build a relationship with the customer and the decision makers over time rather than just rely on your proposal.
Grab customer attention right from the start with your business proposal when you show understanding of the customer, the customer background, and the customer’s industry. That means starting the business proposal does not begin with jumping into writing. It starts with good old-fashioned relationship-building, evaluation of the opportunity, and review of the RFP.
Here’s how to start the business proposal once you have the RFP:
Step 1: Read the RFP
Thoroughly review the client-issued RFP. The RFP will contain pertinent information related to the client’s requirements, the contract terms, and the project that needs support. Understand every nuance of the RFP to ensure you know how to write a business proposal. If limited on time, an RFP software with an RFP Parser will save you substantial time.
- Verify that you can meet the client requirements. There are some areas that may inhibit your ability to effectively respond to the RFP with a business proposal. For instance, if you cannot meet the allotted budget or given timeline, then you ought not submit the proposal. Otherwise, consider partnering with an organization that can help you close requirement gaps.
- Gather questions to ask the client. Prior to starting the business proposal, get as much clarity as needed on the client requirements, the RFP itself, and any other questions that are permitted to send to the Purchaser or RFP personnel. Some of the questions you may want to think about are:
- Were there any prior attempts made to address the issue. If yes, what were the results?
- What are the evaluation criteria for proposal submissions? Specify the evaluation process.
- What are your concerns about the current vendor?
Step #2: Format Your Business Proposal
Format the document properly according to client and your organizational standards. Think about the font size, color, page usage, outline, and all other components that will make the business proposal readable. You can format your layout before writing the bulk of the business proposal with a proposal management software.
- Fonts. Generally, serif fonts are business appropriate and grey font helps with readability. Sometimes a client RFP will specify these details. If not, it is recommended that you use Times New Roman at 12 point.
- Templates. Look for sample proposals used in the industry, created by your competitors, or even client-awarded proposals to get an idea of business proposal layout. There are plenty of business proposal templates online to help you make the proposal look professional.
- Title Page. Most business proposals will have a title page or cover page. The title page comprises your organization’s name, the point-of-contact’s name, the name and organization we are submitting the proposal to, the RFP number, and the due date.
Step #3: Introduce the Problem
Introduce the client problem as soon as possible in your business proposal. Your business proposal is meant to recognize the problem and detail your solution. Usually business proposals identify the problem in simple and clear language immediately in the Cover Letter, and then again in the Executive Summary. Tailor your introduction of the problem to the client’s industry and the RFP to show your understanding. Then introduce your solution.
- Establish the context. Introducing the problem helps you establish the context for the proposal. You must remember that the reader and the evaluator read hundreds of proposals all the time. Make it easier for them to qualify your business proposal.
- Define terminology. Your business proposal must be tailored to the client, which means you should use their terminology and clearly define your organization’s terminology as well. With that stated, keep the business proposal as simple as possible. No need to overfill with industry jargon.
Step #4: Define a Roadmap
Business proposals are lengthy documents. Provide an overview of the business proposal components (beyond just the Table of Contents). Make sure to use the section titles and wording that is outlined in the RFP. A great place to define the business proposal roadmap is in your Cover Letter.
Here’s an example: “Part I of this response to RFP No. ### includes the Executive Summary and Company Background. Part II offers the proposed solution, timetable, and an explanation of benefits in detail. The itemized budget and a set of standard contract terms is provided in Part III. Finally, in Part IV, we summarize our experiences and solution.”
How to Write a Business Proposal Effectively
Research plays a major role before you can learn how to write a business proposal effectively. Research and analyze your product, your market, and understand your objective. Consider spending twice as much time researching, analyzing, and evaluating as you spend writing the business proposal.
Afterward, your business proposal must contain very detailed, yet concise information. For the sake of brevity, represent the solution’s benefits or other lengthy information in bullet points where possible.
Here is what you want to do:
Step #1: Suggest a Detailed Solution with Graphics
Once the problem you are trying to solve is identified, your proposal must show and tell the proposed solution. Try to be as clear as possible and demonstrate the value of your products or services. Rather than just say your organization can do “XYZ”, provide detailed examples and proof points that support your claims. Show the solution with tailored graphics that catch attention and provide a visual way to understand your explanation.
Step #2: Explicate the Benefits of Your Solution
There is more than one way to solve a problem, and your reader knows that. An effective business proposal persuades its reader that the proposed solution is the best because the benefits will be clearly defined.
Benefits that resonate with proposal evaluators include cost savings, professional expertise of the solution team, and outcomes from tailored procedures.
Step #3: Provide Evidence for Benefit Claims
Adding case studies and past performance to your proposal are strong forms of evidence. If there are no previous studies, then observation from prominent people in the industry or previous customer recommendations will suffice. A former customer could testify that you saved their business money with the XYZ solution.
Step #4: Outline Your Solution’s Schedule
Your reader wants to understand the solution and how and when you will implement it if awarded the contract. Explain the timeline for the tasks that need to be completed. It is possible that your schedule will adjust in the future, but that is understood. In fact, explain that your solution is flexible to meet changes to client’s needs. A solution schedule helps the reader understand how solution execution will fit into business objectives. Your outline should:
- Summarize key milestones. For example, if you propose a solution to remodel a store, then you would include the start date for project planning and execution and when the store will be reopened to the public.
- Emphasize flexibility. Overexplain that the proposed solution schedule is an estimate that may change to ensure your organization is not held liable for missed milestones.
Step #5: Determine the Budget
A budget or cost proposal may be the most critical part of the business proposal. The reader needs to know if they can afford your services, so you must include pricing and applicable terms like price guarantees. Factor anticipated risk into the pricing. For instance, you can multiply the sum of the predicted budget by 1.5 to account for any unanticipated circumstances. Initial set-up costs, labor costs, supply costs, ongoing monthly charges and maintenance charges should be included in the budget based on requirements.
Just like with your proposal schedule, explain that the budget rates are estimates and account for risk.
Step #6: Include the Contract Terms
Your reader wants to understand your terms for executing the proposed solution. Be sure to include the terms and conditions, including price guarantees in the proposal. Adding legal terms and conditions upfront, such as for the following concerns, will protect your organization from legal issues:
- How much is being paid on the date of signing?
- Penalties or interests calculated for late payment.
- Cancellation policies such as pre-payment penalties.
How to Conclude a Business Proposal
The conclusion of the business proposal is like the final chord in a song. A song’s conclusion gives the listener the final feeling, one that will be remembered forever. The same impact is true for proposal readers. As we conclude (no pun intended) this article, learn how to conclude a business proposal with these critical steps.
Step #1: Sign Off the Right Way
Once you have carefully shaped your proposal and final points, there are several ways to end a proposal with an appropriate sign off. Summarize the main points, restate the purpose, and finalize your business proposal. These areas should help you write a proper sign off to conclude your business proposal:
- Past performance. Reference projects and past performance within the same scope as the RFP and explain the success you achieved. Make sure you summarize that your experience in these areas will ensure your solution for the prospective client. For confidential information, simply replace previous client names from the project summary with a an eye-catching description like “Multi-national Financial Services Firm Headquartered in Boston, MA”. You can also summarize information together like this: “Effectively provided Accounting and Payroll Services to 30 mid-sized businesses for the past five years.”
- Strong team capability. You can certainly explain your team’s capabilities in the meat of the business proposal. Yet, in the conclusion, you still want to drive home that your organization offers a team of fully capable and well-experienced professionals who will oversee the project. Typically, resumes of the internal team and hired resources will be added at the end of the business proposal.
Track your team’s information and hired resource capabilities to easily add profiles to your business proposal. A proposal management software like Zbizlink maintains a content library, autofill features, and built-in resume templates to streamline this process so that you do not have manage this information manually for every proposal.
- Your conclusion is your last shot to shut down any possible opposition about your solution. Deliver your differentiators one more. For example, if our business proposal is to assist businesses by categorizing which employees they could fire, then we can expect opposition to rising. At the same time, if we propose to construct the company rebrand, then others in that company might obstruct it. Hence, we need to recognize and then counter any predicted opposition as: summarize the expected competitors, discuss the likelihood and raise counterarguments.
- Cite your past performance and add references including point-of-contacts from previous clients. It is recommended to add references in table format or however the RFP requires.
Step #2: Review, Review, Review
First, pat yourself on the back for finalizing your business proposal. It is time to review it before submission. After you conclude a business proposal, set the draft aside for a day or two and then review it. Search for typo errors, accuracy of numbers, and missed requirements. Use a search and find feature in a proposal management tool to fast-track review for certain words or phrases. Shorten the proposal if necessary.
Step #3: Submit with Care
Your business proposal must be submitted based on the RFP requirements. Sometimes that is as a hard copy, via email, or via an online portal. Before submission, follow these measures:
- Review the RFP once more and any other correspondence.
- Remind your team of submission deadline.
- Double check that all required components are visible, easy-to-find, and included.
For email submissions, send careful closing lines such as “We would be delighted to have you as a client,”, “We look forward to your partnership…”, and so on.
For hard copy submissions, ensure that your packaging is compliant and neat. Submit your business proposal in an organized binder unless otherwise stated in the RFP. Make sure everything is labeled according to proposal sections.
Zbizlink is a cloud-based software that provides end-to-end proposal support with automated workflows, centralized content libraries, and teaming management capabilities to help you cut down time on proposal response and find the right partners to help you.
When it comes to how to write a business proposal, leverage the right resources and the best proposal management software so that you can repeat your strategy with minimum effort.