A business proposal is a written request to engage in business with another company. Responding to business proposals is one of the most effective ways for businesses to get business and continue to grow-and should be accounted for when developing a business plan.
Requests for business proposals (RFPs) are both solicited (often through email distribution lists) and unsolicited. A solicited business proposal is one in which a company who wants to buy something issues an RFP, or Request for Proposal, inviting prospective vendors to submit a product or business idea that will solve a particular problem or address a particular need.
Unsolicited business proposals are usually created by companies who need money, or who wish to partner with another company in a joint venture. Either way, a successful business proposal is one in which the buyer and seller both benefit.
A winning business proposal is one that is well-considered, meaning that much thought and planning go into gathering information and creating a solid template. For the company writing the proposal, thorough research is imperative. It is recommended that, in situations where the proposal is solicited, the vendor interviews the company that issued the RFP.
Key questions to ask during the interview include the following: What have you done in the past to address the issue you are currently facing? When would you like this project completed? What is your budget? What is your expected outcome with this project?
Business proposals are complex documents that are seldom less than 20 pages, and can sometimes reach thousands of pages. They typically include two parts. The first part describes the proposed business plan, including how the vendor will meet the buyer’s needs. The second part explains the financial details of the plan. Together, the text and financial data form a unique solution that is different for each situation.
Whether the business proposal is solicited or unsolicited, a proposal that is convincing includes five fundamental parts.
A successful business proposal focuses on buyer benefits
The buyer should clearly understand the benefits to be gained from working with the vendor submitting the proposal. Is the vendor committed to finishing the project on time? Will all buyer requirements be strictly adhered to? Will the vendor willingly accept feedback as the project progresses?
An effective business proposal details solutions
The vendor should spell out how it will provide solutions to the buyer’s needs. This means that the proposal should provide specific details regarding deadlines and costs. Buyers need concrete information regarding how the vendor will meet their unique needs. If the vendor’s implemented business plan will reduce the buyer’s operating costs by 30%, then that process should be clearly explained.
A winning business proposal uses language tailored to its audience
As with all professional writing, a well-crafted document considers its intended audience and uses language with which that audience is familiar. It’s fine to use jargon, as long as the jargon is standard in the target industry.
A persuasive business proposal aims at establishing credibility
Convincing buyers of benefits and solutions is crucial to selling a proposal, but establishing credibility is just as important. Ringing, third party endorsements from customers and others in the industry go a long way toward placing a proposal closer to acceptance.
A convincing business proposal uses samples to drive home a vendor’s ability
The best business proposals list samples of previous work that highlight the vendor’s ability to provide viable solutions. Even a small sample that shows off the success of past projects could mean the difference in winning a bid. There is no substitute for experience.
Finding RFPs either online, offline, or through email subscriptions lists is a great way to start generating more business for your small business. When you’re looking for more business in your free time, it’s wise to look for RFPs and develop streamlined, effective responses.