A business proposal is critical for forming new relationships to grow your business. A well-written proposal can make the difference in winning or losing prospective clients or customers. When looking for new customers, a business proposal is a formal document that provides essential details of your goals and plans.
Writing a business proposal does not have to be complicated. Legal Templates has an accessible business proposal template available for you.
What Is a Business Proposal?
A business proposal is a formal document that you provide to a prospective client in hopes of obtaining a business agreement. They are commonly used by B2B or business-facing companies where the seller attempts to persuade prospective buyers into buying their services or goods.
The proposal aims to gain business, not sell the company itself. Unlike a business plan which seeks potential investors, a business proposal seeks new customers.
Types of Business Proposals
There are two primary types of business proposals:
- Solicited Business Proposal: A solicited proposal is one that was requested by the client or potential customer. Your company then provides the business proposal it asked for.
- Unsolicited Business Proposal: You send unsolicited proposals to a customer when the customer has not explicitly asked for them. Your company is reaching out to attempt to gain new business with your submission.
Customers may seek a business proposal with a request for a proposal document. They are coming to you to see if you would be an appropriate vendor in this situation. A solid business proposal can help you answer their request and win business.
Other types of business proposals include continuation business proposals and renewal business proposals. Both are used to continue working with an existing client to update the terms of an agreement or to extend one.
When to Use a Business Proposal?
You should use a business proposal to grow your business and solicit new customers. You are reaching out to potential clients to see if you could work together to further your mutual goals. Whether the proposal was solicited or unsolicited, you want to create a compelling proposition that lays out the essential details of your business.
How to Write a Business Proposal?
You can write a business proposal by following these steps. It is even easier to do when using a template.
Step 1 – Title Page
The title page should introduce your company’s basic information. It is an introduction to yourself and your business. This should include:
- Business address
- The date you submitted the proposal
- Your contact details
Keep the look of the title page professional and reserved in most cases.
Step 2 – Project Overview
The project overview provides a quick summary of what your company does. It will quickly address why the company is well-suited to engage in business and deliver the goods or services the client is looking for.
An effective business proposal provides comprehensive information succinctly. It is not overly wordy, and you do not need to share every piece of information about your business. Focus on the essential details that will catch the reader’s attention.
Talk about the service/product details and any challenges and how you can address them.
Step 3 – Executive Summary
The executive summary outlines why you are sending this proposal and why your solution is best for your prospective client. Be specific in this section. Address the needs of the individual client and be specific. Outline the benefits of your company’s services and products and how they will solve the client’s problems. You want to show that you bring something unique to the table. Show why this business should pick your proposal instead of the many others they have received.
Step 4 – Project Details
A business proposal should include the key details of your proposed project. This helps the client see how you will address their scope of work and meet their unique goals and objectives.
Step 5 – Budget and Financials
Pricing projects is not always fun, but it is essential to a successful business proposal. You need to explore your pricing strategy and understand what you will charge for goods or services. You need to propose a budget and price that is attractive to prospective clients but is appropriate for your bottom line.
This section is adaptable to your business’s needs. The sale of goods or services requires different pricing terms. A customizable business proposal template allows you to create a document that fits your needs.
Step 6 – Terms and Conditions
The final section of your business proposal is where you can lay out any additional terms and then finish with the proposing company and proposal receiver signing the document.
Business Proposal Sample
You can download a free business plan template in Word or pdf format:
Business Proposal
Business Proposal Frequently Asked Questions
What information should be included in a business proposal?
A well-written business proposal should include important information such as:
- A title and table of contents
- An introduction and executive summary
- Your qualifications and why you will meet the customer’s needs
- Pricing, billing, and legal information
- Proposed solutions and description of goods or services
What is the difference between a business plan and a business proposal?
The difference between a business plan and a business proposal is that a business plan is a document meant for new business planning and seeking out investors. A business proposal aims to acquire customers or buyers for your products or services.
What is the purpose of a business proposal?
The purpose of a business proposal is to convince a potential client (usually a business) to buy what you have to offer, whether a product or a service. As your proposal will typically be in competition with other proposals from rival companies you need to use yours to show how you differentiate and demonstrate the value you can provide to the potential customer.
How many pages should a business proposal be?
How many pages your business proposal should be depends on the amount of information you need to communicate to a potential client. You should always try to be succinct, but you need to include all the points the ideal buyer needs to know about your business. The length of a business proposal often comes down to the complexity of the project.
You don’t want to overwhelm a potential client with pages and pages of information. Simple and straightforward projects could be one or two pages long, while complex projects could require a lot more or even a small marketing plan. Just keep your information clear and concise and avoid fluff and filler content. A simple business proposal template is an effective way to ensure you don’t under or over-sell yourself.