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How to craft a winning proposal

By following my three-step process, you can create a repeatable process that will significantly reduce the time and energy you put into pitching business. You’ll also bring consistency to your offers and convert them to business faster and easier. If you get good at pitching business, you’ll inevitably get better at closing business.


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Richard Fouts

3 years ago | 8 min read

“When can you get me a proposal?” It’s a great buying sign, but most organizations misinterpret this question to mean, “When can you get me a big, fat document that no one will read?”

By following my three-step process, you can create a repeatable process that will significantly reduce the time and energy you put into pitching business. You’ll also bring consistency to your offers and convert them to business faster and easier. If you get good at pitching business, you’ll inevitably get better at closing business.

Step 1. Craft a Proposal Theme (aka, a reason-to-buy).

Think of your proposal theme as a movie’s one-line descriptor:

A depression-era Southern lawyer defends a black man against a false rape charge, and his children against prejudice (To Kill a Mockingbird)

The aging patriarch of an organized crime dynasty transfers control of his empire to his reluctant son (The Godfather).

We’ll build you a custom home within your budget, using an award-winning architect — from start-to-finish in under a year.

What differentiates a proposal theme?

Competitive bids begin to look and sound alike, especially in mature markets where companies approach a business problem in similar, if not identical ways.

By creating a strong theme you can be the proposal that stands out, that the buying committee remembers when it comes time to narrow the field or make an award. So how do you do it? Get your team together and brainstorm answers to this question:

What is the most important (quantifiable) outcome you want the buyer to remember?

When I was an analyst covering digital commerce, IBM started its brief with “Most clients double their online revenues during the first year of our implementation” (and they had the references to back it up). When I wrote my report, I remembered the doubling of online revenues.

Tightly align your theme with your buyer’s key decision criteria.

While this sounds obvious, I’m amazed at how many providers make the theme about them, not the buyer. I once told five competing vendors that, based on Voice-of-the-Customer studies, my company was viewed as hard to do business with (yet, only one competitor picked up on it). Guess which vendor won the business?

Don’t forget your impact statement.

Always, always address what is preventing your buyer from achieving their desired outcome, also known as the impact statement. Without impact, there’s no business case. Without impact there’s no reason to buy. Tie your impact statement to outcomes.

Consider this from Vantos Software:

<<THEME>>

We propose to help you reduce the time to close an investigation by up to 50% while giving your investigators more time to investigate.

<<IMPACT>>

Too many Investigators divert limited windows of opportunity to gathering data and filling out reports. This prevents them from conducting investigations and solving cases. When this happens, prosecution levels drop, and perpetrators go free.

<<OUTCOME>>

On average, users of Vantos software have reduced the time to close an investigation by over 50%. One District Attorney reports average time to closure has gone from 5 months to 2 weeks. Investigators love it because out analytics point them to specific areas to investigate. On-line reports take the place of manual processes — so they can focus on what they do best.

Vantos has a great proposal theme: to help investigators investigate — while reducing the time to close an investigation by 50%.

Step 2: Scope the Proposal (using a Statement of Work).

Many providers do not include the SOW in the proposal, preferring to first get a letter of intent or verbal acceptance of the proposal. Once they’ve secured this, they go on to draft a work statement. This is usually a mistake. Why? It simply extends your sales cycle (bad for you, good for your competitor).

Use this three-pronged scoping tool (Table 1) to specify what you will deliver, how much time and money it will take, and your terms (also known as assumptions).

Table 1: A proposal scope answers three questions that are universal to any deal structure:

  1. What will you deliver? Often best achieved with a statement of work, list of products, or an SLA (Service Level Agreement).
  2. How much time and money will it take? Also known as Price and Schedule, this section clearly articulates how much it will cost and when your offerings will be delivered.
  3. What are your terms (or assumptions used to price the work)? What have you assumed to assure the customer receives everything you’ve committed — within the time and money constraints you’ve specified? This section could also include terms around IP ownership.

When it’s time to put it all together, use my Table of Contents (Table 2).

Table 2: Standard Table of Contents for any type of offer.

Step 3: Present Your Offer

Never miss an opportunity to deliver your proposal in-person or via video. The passion in your voice about solving your buyer’s problem is far more effective than reading words on a screen. Always start by reviewing the starting assumptions you used to craft your bid. Before you continue, ask your buyer if anything has changed since you last spoke.

When you present your offer, communicate the price early on.

This is not a hard-fast rule, but audiences tend to drift off while you’re talking about what you do — because they really want to know what it will cost them. Presenting price sooner than later, scares most salespeople, but it’s what buyers want.

If you think your price tag will cause sticker shock, it’s even more important to have a solid, convincing impact statement. Show how your proposed solution dilutes the impact (or even makes it go away). Be confident that you’re worth a premium price. When things go wrong, no one ever says, “But they were the low-cost vendor.”

Another good rule (if your price is likely to cause alarm), float it by your buyer ahead of your proposal due date. Remember: anything you can do to socialize your proposal ahead of the due date is a good thing.

In Conclusion ….

Use proposals to convey what it will be like to do business with you.

Twice, I hired vendors that submitted complex proposals with hordes of detail (my error was being overly impressed). Both produced nightmare relationships because they couldn’t solve problems. They couldn’t get out of their own way. Look for the type of people Albert Einstein liked to work with (he used to say “I like people who simplify things”).

Use the proposal phase to gauge what it will be like to do business with the prospect.

If the pre-sales relationship is difficult, the post-sales relationship will be even worse. Trust me on this. I once sold to a prospect for a year. It was a big company with big budgets but the pre-sales process was packed with distrust and humiliation.

(My designer later said, “they must have founded their own vendor-abuse school.”). We lost money on the deal, mostly because the customer didn’t take their dependencies seriously.

Beware of abusive buyers.

We’ve all been there. If your buyer was a vendor-abuse graduate — think about walking away. When I worked in sales support at HP I was on a call at Southern California Edison, where the CIO just couldn’t stop dumping on how much he hated computer companies.

I’ll never forget the account executive (Jan North). She said, “If you continue to disrespect my people I’ll end the meeting.” The buyer ignored her (sure that she was bluffing). Sixty seconds later, Jan politely said, “I’m sorry we couldn’t be of service to you today.” And with that, we left (the CIO apologized later that day and invited us back in).

Beware of buyers that ask for a proposal too soon.

Proposals can be a lot of work, even when you have a standard, repeatable process and good templates. But in my experience, buyers that ask for a proposal too quick are either 1) not qualified or 2) just trying to blow you off, because they’ve already made a decision.

It’s okay to say, “I don’t have enough information for a proposal” or something more disarming, “It’s way too soon to be asking for a proposal. Can you share what’s going on?” If you get a good answer, you can agree to submit a scope of work, without a price tag (to get agreement on needs).

Use proposal requests to negotiate, e.g., “I’ll get you a proposal if you get me in front of your CEO.” Or, “I’ll deliver a proposal if you deliver your CMO to the presentation”.

Include an FAQ.

Buyers are shy. And they don’t always ask the hard questions because they’re afraid of confrontation. Use FAQs to communicate crisp answers about what it’s like to do business with you.

How do customers get support during off-hours? What’s your escalation path, in the rare event it’s needed? Who is the customer’s single point of contact? Who retains IP? Is there a warranty? FAQs are great tools because they add Outside-In perspective.

Make it easy to convert your offer into an agreement or contract.

Most providers in the service business wait for the buyer to request a work statement or contract. Put these documents in your proposal. Granted, things will change (perhaps during negotiations) but having it up front for review, puts you a step ahead of your competitor.

Meet proposal due dates.

I have never, ever in 25 years asked for a proposal extension. If your buyer requests a turn-around-time that is simply impossible, negotiate the date upfront.

Think of ways to avoid a proposal.

Do you have a free trial? Or, if you’re in consulting, can you deliver a free strategy session? Or a free audit? If you can deliver meaningful value, as a proposal substitute, you stand out from your competitor (and start forming a relationship).

I learned this from a sales veteran who said to a prospect: “I could spend 10 hours on a proposal or 10 hours delivering real value that you can use right away.” It’s a compelling way to do business. And, it provides a way to gauge the tone of the future relationship.

Have fun (and don’t forget to qualify).

After all of these pitfalls and things to avoid, I have the audacity to tell you to have fun? I once asked my youngest sister (an actress) why she was so calm just before an audition. Her answer, “I love auditioning.

It’s an opportunity to practice what I do and I love bantering with the director.” She had a 90 percent close rate (which eventually grew to 100) which she attributed to picking auditions where she was well-qualified. Eventually, directors would pitch her and why she should work for them.

It pains me to see so many salespeople wasting time on prospects who will never buy from them. Do your homework. Always be qualifying. And don’t forget to practice your pitch.

Again, trust your instincts. Ask yourself, “Is our offer right? Will this company make a good reference? Is the chemistry good? Do we respect each other?”

Remember, you’re not just auditioning for them, they are auditioning for you.

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Richard Fouts

I help organizations get their stories above the market noise.


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