How to Write a Business Proposal

Business proposal writing Providing general advice regarding how to write proposals for business purposes is not easy. This is because the type of proposal required can be diverse in terms of its purpose, size and the intended recipient.

For example, in terms of purpose there is a difference between a sales proposal and a proposal intended for internal use, which could relate to changes in processes or strategy. Similarly, there is a difference between preparing a product or service based proposal. The size and complexity of the proposal also needs to be considered, particularly in relation to the numbers of participants. A proposal for the development of a major project, such as the building of a new operations plant, would require involvement and input from a number of business experts from various departments, whereas a sales proposal being submitted to a single customer might be written by one person. Furthermore, the type of recipient may also influence the proposal content and style. A typical example of this is the variances between a proposal submitted to the private and public sectors.

However, there are areas of a written business proposal where the same rules would apply to all.

RESEARCH

In many cases, the person or organization requesting the proposal will provide verbal or written instructions, which can be used as a guide for the proposal author. However, this is not always the case. In either situation, there is still a need for research. The purpose of research is to ensure that the author has availed himself or herself of the necessary level of knowledge to be able to address the issues in an efficient and effective manner.

This research may include further discussions with the recipient. The intention here is to make sure that there is a full and complete understanding of what is required, which may relate to such issues as quality, style, transportation, timing and price. Unless this knowledge is available, there is a potential risk of the implementation of the proposal failing to deliver the required solution.

Furthermore, research is required to ensure the proposal contains the latest and best practices and processes. An example of the importance of this can be seen within a marketing proposal. A recipient of such a proposal is hardly likely to be pleased if the marketing plan has not taken into account the latest Internet promotional opportunities, such as networking and websites. Similarly, a client would not be happy if the proposal they receive shows no sign of investigation into cost and other supply comparisons.

Competition is another area of research that is required. This area is of particularly concern when writing a sales proposal. If one does not have knowledge of competitors and how their businesses are operating in terms of price, quality and other processes, there is every chance that the proposal will not provide the business with a competitive advantage. The best-prepared proposal in the world will not succeed in its objectives if it is not competitive in terms of price, cost reduction, quality and purpose, as many failed businesses have found to their cost. Therefore, to ensure that the proposal is positioned correctly, knowledge of other market players and their processes is important.

LAYOUT AND DESIGN

The days of writing proposals on the back of cigarette packets or scraps of paper have long gone, if they ever existed. Yet still, even with the benefit of modern design, presentation and word processed proposals are being submitted in a condition where it is evident that the author has paid little attention to layout and design, despite the benefits of these programs.

Recipients of proposals want to receive a document that flows in a logical manner, is well designed in terms of layout and continuity and where attention to detail is evident. Simple errors such as grammar and spelling mistakes or lack of a logical flow of the information contained within the proposal are likely to raise concerns. If the proposal does not show evidence of attention to detail, the recipient may question whether the implementation and delivery will suffer from the same problems.

CONTENT

In some areas, advice upon the content of a proposal might be seen to overlap with the previous section. However, there are factors that need highlighting in this respect. The first of these factors relates to the logical progression of the proposal, which will ensure ease of reading and understanding. A document that is not properly structured is difficult to read and, more importantly, can lead to confusion in respect of what is being proposed, which can damage the eventual outcome of the project implementation.

In the author's opinion, the proposal should follow a logical sequence that covers the following points.

1) Introduction

The introduction is intended to provide a brief overview of the project, including what it relates to, the client it is being prepared for and information about the person or organization that is submitting the proposal.

2) Objectives

In the objective section, it is always advisable to commence this with a detailed understanding of the client or recipient's requirements. This approach limits the potential risk of future misunderstanding. Following on from here a more detailed analysis of the objectives can be provided.

3) Project plan

Within this section, a detailed plan of the performance of the project is required. Often on larger proposals this might include a Gantt chart that will indicate the various project milestones and timescales within which each part of the proposal will be implemented and delivered to the client.

4) Project resources

Providing the recipient with details of the resources being committed or required for the project is important. For example, the details of specialist equipment and numbers of human resources being assigned to the project will allow them to judge the level of realism applied to the project plan indicated in the previous section.

5) Competencies

All recipients will want to know how competent the proposing person or organization is in terms of the type of project being referred to within the document. Therefore, it is always advantageous to incorporate within the proposal details of similar projects or sales levels that have been previously carried out and some indication of the expertise of the human resources that will be committed to the tasks identified.

6) Cost and contracts

Certainly from both the writer and recipient's viewpoint one of the most important aspect of the proposal will be the cost of the project, product or service being delivered. However, it is also important to include the terms and conditions that these costs apply to and any other issues that might affect the costing.

For example, there may be a penalty clause included for late delivery or payment. Similarly, costs might need to be qualified. If the price of supplies increased between the date of the proposal and its acceptance, there will be a need to add a proviso that allows for these increases. In addition, the cost of alteration to specifications needs to be addressed within this section.

7) Appendices

Appendices can be useful for the inclusion of references relating to the conduct of previous projects or sales contracts and detailed resumes of the key personnel who will be involved with the performance of the contract. In addition, other relevant information that is considered to add value to the content of the proposal might also be included within this section.

Other sections that might need to be included within the proposal could include regulatory and legal conditions outside of the control of the person making the proposal but that need to be adhered to in the performance of the project.

SUMMARY

Whatever type of written business proposal is being presented, as is apparent from the above, three of the most important areas that need to be considered are research, layout and design and content. If sufficient attention is not paid to these areas, and the results communicated effectively within the proposal, there is every chance that the proposal will be consigned to the nearest recycling bin. This will not only lead to the loss of the project being promoted within the proposal, but also reduce the chances of developing a future positive relationship with the recipient.

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9 Practical Ways to Improve your Business Proposals

Business proposals can be difficult documents to produce. It’s sometimes hard to figure out what’s right and wrong and what the customer would prefer to see versus what you need to propose. Because every customer is different, both from a corporate perspective and from an individual personal point of view, it’s very difficult to definitively say what a successful proposal should look like. Each customer will have their own corporate and individual preferences in the way they want to see proposals offered and in what content they believe they should contain.

It is possible, however, to identify some generic guidelines that can apply to all proposal documents that will increase the chances of yours being a success. In general, these will help you to get your message across more effectively and avoid you making basic errors in the documentation that can undermine your credibility and what you’re trying to achieve.

1)  Spelling, grammar and punctuation.

This is a basic precaution, but one that is missed all too often in the rush to make a delivery to a customer. Few things will undermine a proposal faster than a document riddled with basic spelling, grammar or punctuation errors. The irritation factor alone for the reader will mean that your document is unlikely to be taken seriously and at worst, it may cast doubt on the seriousness with which you approached the subject and the amount of effort you put into your solution.

Some will say that there are other things to worry about in a proposal, like making sure you address the customer’s requirement and demonstrating that you understand their business. These are rightly important issues, but if you allow a basic aspect of document production to be missed, you risk undermining all of the good work you’ve done in getting your message across. Check, check and check again. Never submit a proposal document that has not been thoroughly proofread and edited, preferably by someone other than the author. Never rely fully on software spelling and grammar checkers as these are not foolproof tools.

2)  Make full use of illustrations and captions.

You’ve heard before that ‘a picture is worth a thousand words’. This is true in proposal documents as much as in other aspects of life. Where you have a solution or issue that can benefit from using an illustration or a diagram, use it one. Readers are generally drawn to pictures and graphics and you can use this to your advantage. Make sure that the graphic is useful and not a gratuitous picture of something only semi-relevant.

Since the reader will be drawn to the graphic, it’s a good idea to maximize the effect of the graphic through the use of captions. These are short lines of text located with the picture that explain the picture or get across a key idea or message that the picture relates to. These are excellent tools to get key ideas into the reader’s mind quickly.

3)  Highlight your key messages.

In a similar tactic to the use of illustration captions, it can be beneficial to draw out key phrases or sentences to catch the reader’s eye. Often these will not relate to a picture, so try using pull quotes. A pull quote is typographical design or style element often used in journalism and graphic design that places a piece of text on a page in such a manner as to catch the eye or draw attention to it. Look up pull quotes on the internet to see examples of how it’s used and its effect.

The effective use of pull quotes with an emphasis on graphic design can make your document look and feel more professional, especially if they are integrated into the document design and style.

4)  Make your document look and feel professional.

As with anything in life, first impressions in business proposals are vital. Having a document that looks and feels professional will help you give the best possible first impression. Making your document look good, won’t help if the content isn’t up to scratch though, so don’t forget that while it has to look good, it also has to deliver the goods in terms of what you’re proposing. While you want to avoid having your proposal look like a triumph of style over substance, the impact of a well presented and well-designed document should not be understated. It could be the difference between winning and losing if you’re document gives the impression that you tried just that little bit harder or that you’re just that little bit more professional. Remember you’re almost always dealing with a situation where your proposal will be read and assessed by people. People like to look at documents that are pleasing and well structured.

5)  Make the most of automatic cross-referencing.

Much like the spelling, grammar and punctuation advice, this refers to the elimination of basic errors in your document that can undermine your hard work. Modern word processing applications have the ability to automatically link and cross reference different items within themselves, like headings, figures and tables. Where you want to make reference to another paragraph or section, use the ability to automatically insert a cross reference to do this. The reason this is a much better approach will become clear if you have to insert or delete a paragraph heading. Using an automatic method of inserting the paragraph or section number will allow the document to automatically update if those numbers or names change. Entering the reference by hand means you will have to proofread the whole document to find every cross reference whenever you make any changes that affect them. This may seem pedantic, but you don’t want to reference a section wrongly and undermine your work. When you send the reader to a paragraph or page, they should find what they’re looking for.

6)  Be careful with jargon and terminology.

Conventional wisdom would have you believe that the use of jargon should be avoided at all costs but in business, jargon can sometimes be what makes the subject comprehensible for those that are steeped in a particular subject or industry. Use of jargon or technical terminology can be entirely appropriate provided you can demonstrate that you know what it means and what it means for your customer. Be sure to use only terminology that the customer will readily identify with. To be on the safe side, where you have used jargon or specific terminology, make sure you include a glossary or definitions page. The purpose of this is not so much to educate your customer in the meanings but more to demonstrate that you have a shared understanding of the meaning.

7)  Include an abbreviations page.

Some industries seem to thrive on the use of abbreviations. Specialists in some subjects will understand whatever abbreviations you can throw at them, but remember that your proposal may be read by others, who may not have as full an understanding of the subject as you do. Make sure that you include a page listing all of the abbreviations used and their expanded meanings.

The most reliable way to do this is to print the document out when you’re ready to proofread it and have a highlighter pen ready. As you proofread, highlight every abbreviation you encounter. This will allow you to go back through the document and add all of the abbreviations used into a single list, safe in the knowledge that you haven’t missed any.

8)  Use a style guide.

Consistency is a quality that most readers will not notice when it has been achieved. Get it wrong though, and every reader will notice. By far the best way to ensure consistency of writing style, terminology, branding and practically every aspect of your documentation, is to write in accordance with a style guide. A style guide is simply a document that lays out the rules for producing your proposals and gives authors the guidance they need to ensure that every document and section within a document is consistent. It’s particularly effective when more than one person is contributing to the proposal, allowing a cohesive and consistent document to be written from many different sources.

9)  Have a checklist prepared.

In the rush to meet deadlines and get your message across, it’s very easy to miss the basic things that help make a successful document and a successful proposal in general. As you start to form an idea of what you want to propose in terms of your key messages and the content of your proposal document, prepare a checklist that you can use when you think the document is complete. Make sure your checklist covers the business aspects of your proposal in terms of the key messages and solutions you are actually proposing but also make sure it covers the basic document related things like proofreading, formatting, abbreviations, definitions and spelling checks. Having a checklist for these basic items will allow you to speed up the time it takes to get the document completed and ready for submission. You can also be sure that they have been checked and your document is really ready to go.

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How to Write a RFP

As a management trainee in an export firm, I was expecting to be on the frontlines canting on marketing concepts and market strategies. I was in for a surprise when my manager gave me the apparently mundane task of drawing up a RFP document. Now, a RFP is a 'Request for Proposal'. A seemingly simple name for a fairly innocuous task. I knew about it but was not really expecting it to fall on my plate. Perhaps, seeing my discomfort, my manager said to me,” Good business is always good communication. "

He went on to explain:” You are at the preliminary stage of a business process. Your RFP will determine, how you want to go forward...with what...and with whom. This is where the importance of a good RFP lies. I am sure if you understand how we do our business, you will manage the task. Consider it an education."

After these 'encouraging words', I 'sharpened my pen' and jumped into the assignment.

From my initial groundwork I slowly began to appreciate that a well crafted RFP is an extremely powerful tool in any business arsenal. I realized that the effort I spent now in preparing a solid RFP will later save time, money and frustration. After all, the RFP is the guide for a supplier's contract with us. If the supplier doesn't know what we expect, a long negotiation is a certainty, wasting man-hours.

Knowledge shared being knowledge gained, here's a top down approach to preparing an effective RFP.

THE BASIC QUESTION - WHAT IS A RFP?

Request for Proposal is a formal document issued by a company when it wants to buy something and thus chooses to make its requirements public. Through the document it establishes the required specifications and invites those companies who can fulfill it. Usually this is a competitive process and several companies bid for the order. The cheapest price can be one of the selective criteria for arriving at the final choice.

In some usage it is also called as a Request for Quotation (RFQ).

Why do we need a RFP?

A RFP is a decision making tool for a business. It allows the business to decide the best source for its material needs. Potential suppliers also come to understand the specific nature of requirements and what exactly is expected of them. RFP's provide a stable set of specifications for suppliers to work on. Typically, a RFP is more than a quotation about price. It includes information on the company, its history, financial information, technical capability, product information and various estimated time schedules.

Here are some preliminary steps to consider before preparing a RFP:

1. Measure your requirements.

A RFP needs to be carefully built around the specific requirements. The correct estimates give the bidders the exact idea of the demand and supply scenarios.

2. Define specifically what you need.

Distinguish between need and wants. Needs are always primary, wants can be optional. Determine the scope of your requirements. Some components may be not essential but would add value if provided (the 'wants', 'nice-to-haves'). You can choose to accept these components if budgets or schedules permit. The supplier also will know what additional value he can provide as a sop.

3. Prioritize your needs.

In any particular situation, a company can have many needs. It is imperative to distinguish between what is vital and what is less so. It helps to rank your needs in order of importance. An order of priority also helps when final comparison between all submitted RFP's is made. Decide how much information you need to make a qualified decision.

4. Organize and structure the RFP.

The information in a RFP needs to be organized. It helps if the information is structured into sections and/or subsections. Functional and technical information can be put under their own respective heads. Decide the contents so that easy comparisons can be made. The motto should be to share as much information as you can with prospective bidders.

5. Decide on how to send the RFP

You may post the RFP on your company website or send it by mail to an accepted list of suppliers.


The Nuts and Bolts of a RFP

Their is no standardized format for a RFP. Each RFP has to be tailored to the requirements and designed around the information that is to be shared with the bidders.

Generally, a RFP should contain the following information:

Introduction

Give a synopsis of your company and the business you do. A short background of the company also helps the bidding companies 'connect' to the company. Mention the reason for the RFP and the objectives you seek to attain. A 'Where we are' and 'Where we want to be' statement can be included.  Briefly, touch upon the selection process that would follow.

Purpose and Objectives

Outline the main purpose of your business. Your vision statement helps the suppliers to understand your corporate philosophy. The stated objectives help to establish common ground with suppliers and also communicate the serious intent of your company.

Proposal Guidelines- Requirements

This is the most expansive section of the proposal. Also, this section has to be prepared with strict attention to detail. It is here where the process and the guidelines are laid down. Be as descriptive and detailed as possible. If necessary, categorize your requirements under various heads. Also all requirements should have some measurable criteria.

Technical/Infrastructure Requirements

Address the current environment by giving the technical specification of the present system. Following this, mention the projected requirements which form the basis of the RFP. This is what the bidding company should focus on. Depending on the industry, technical specifications could cover some of the following areas:

  • Performance requirements
  • Requirements of space or environment.
  • Hardware requirements
  • Software requirement
  • Communication requirements
  • Benchmarked critical success factors.

Functional Requirements

The functional requirements section should list out total resources that would be required for sustaining the objective.

Possible functional requirements include:

  • Supply Chain and Delivery Schedules
  • Implementation/ installation requirements.
  • Manpower requirements
  • Training, support and maintenance needs.
  • Documentation requirements

The information in this section ensures that suppliers can meet the overall business goals. A supplier may have the technical know how but fail on the service support side. This section thus helps to distinguish between suppliers and their overall capabilities.

Budget

This section should detail all the price points. Comprehensive information would enable the suppliers to prepare their price proposal. A useful exercise would be to give a uniform format (e.g., a sample spreadsheet) with all the breakdowns. A common format also helps when price comparisons would need to be made during proposal evaluation. Distinguish between one time costs and recurring costs. Credit terms if any, can be explicitly explained. Pricing is not usually the sole factor for selection but should be used to decide between two suppliers with equally good technical and functional proposals.

Evaluation and Selection Guidelines

As various requirements are confirmed, a general rule for measuring the requirements should also be established. The evaluation criteria can range from the purely technical like price or product demonstration to more subjective ones like previous experience, referrals etc. All the requirements should be evaluated using the agreed upon criteria. The subjective ones can be mulled over through team meetings.

Timeline and Schedules

Clearly identify your timelines and possibly how flexible they can be. The more detailed the proposal, longer should be the response time. Also tell the suppliers how long the evaluation will take and how soon they will have to start the final negotiations.

Contract and Legal Terms

This section can contain information relating to the purchase, non-disclosure agreements, mention of any penalty clauses etc. In short, any clause which is legally binding should be emphasized here. Warranty clauses should also find mention. Include any conditional clauses which may be binding on the final contract. For e.g., the technical system may need to pass certain tests for final approval. This condition can be reiterated here again. Also, include the validity dates for any contract applicable.

Process of Submission

In this section you can outline how the entire process will work from start to finish. Include contact information, submission method and formats (e.g. number of copies), the anticipated selection date.

It may be also helpful to provide a time window for any corrections which suppliers may want to make in their original submissions.

Appendix

Any information which cannot be included in the main body may be placed here. Specification diagrams, workflow sketches, any statistical information can be outlined.

It helps to provide definitions for difficult to understand terms. We should not assume that the person receiving the proposal would understand everything.

Basically this section gives out any supplementary information which may be too detailed for the main section.

RFP's are the means to an end...not the end itself. Think of it like a map…it says – ‘Here I am, and I am going this way...’ ,the RFP not only tells suppliers where you are going but also selects the road on which they should travel.

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