10 steps you can take to close more deals by creating winning business proposals.
1. Follow a Bidding Policy
There is no need to commit to every project or bid that comes your way. By doing this, you waste time and money.
You should have a clear bidding policy, which allows you to understand whether a project is worth bidding on or giving it a pass. Sometime projects look lucrative and appealing on the surface, but a bidding policy will give you clear criteria and tests that will force you to be objective.
Here are 3 simple questions you should ask yourself before you consider writing a business proposal in response to an RFP or request for a bid.
1. Can We Deliver?
Do not jump into bidding without assessing your strengths and weaknesses. Writing a great business proposal takes time and preparation. If your core skills do not meet the requirements, the time spent analyzing the market and learning new project requirements will be wasted. That time is better spent on other activities that bring results. Ask yourselves:
- Have we completed a similar project before within the required time frame?
- Do we have all the necessary skills for this project?
- Do we have enough people to complete this job on time?
- Do we have to bring in additional workers? If so, is there a budget for it?
- Will the client be reasonable to work with?
Also answer any questions specific to your market and the particular RFP.
Be honest with yourself. Evaluate your business as if you were the client.
2. Can We Win?
First things first. Get as much information as possible about the client and find out if there is an incumbent. If there is, dig harder to gather information on them other service providers that may compete with you in the tender. Understanding what may be right or wrong with an incumbent’s performance may give you the keys to writing a successful business proposal.
Some tenders are thrown to the public to simply meet legal requirements or justify management’s decision to extend an incumbents contract. Look for hints in the RFP and for transparency in the overall bidding process. If you feel some things are not right, then it probably isn’t.
List client issues and compare how you stand up against competing companies. Can you add something extra to persuade the prospect to choose you?
You might also think about using proposal software to look more professional.
3. Can We Make a Profit?
Consider your business plans and current projects and sales pipeline. Keep your business proposal flexible, but adhere to the tender timelines. Make sure you know the answers to these questions:
- Will we need the required expertise later?
- Will doing this project influence our existing customers?
- Is there a realistic probability that we will gain more projects with this client?
- Are we making money or working to build our portfolio?
- What are the long term benefits or potential negative impacts on our business?
Only after you’ve answered YES to each of the first three questions, should you move forward with business proposal preparation and submission. Be honest and assess yourself critically. Give the RFP document a deep analysis and evaluate your competitors. Remember to take into account the current state of your business plans and long-term objectives.
Check also 3 Questions to Ask Yourself Before Bidding on a Freelance Project
2. Create Clear Value Proposition
A business or marketing statement that summarizes why a consumer should buy a product or use a service. This statement should convince a potential consumer that one particular product or service will add more value or better solve a problem than other similar offerings.
A clear value proposition is the most important factor in your business proposal. It’s what makes prospects become customers.
Building a working value proposition is not easy and requires critical assessment of your business, exploration of the competition, and clear understanding of your clients.
If your company has several products or services, you will need to define a strong value proposition for each of them.
Key points of a value proposition
Make sure your value proposition answers these questions:
- Who is your target audience?
- What problem do they have?
- How does your offering solve it in a unique way?
Writing a great value proposition requires that you have a clear understanding of your target customer, their wants and needs, habits and financial realities. You wouldn’t be selling logo design services to an English teacher, as they don’t need it. Don’t try to sell something to people if they have no time, no need, or no money.
Figure out the problem, or better yet, ask your clients about it. When you discover a “hot button”, you know how to respond better, instead of guessing. Customers want to help you, but you must ask the right questions.
If you are selling buckets, chances are there are many competitors. You can copy your value proposition, but you need to understand that clients spend time on research, the same as you do before buying a new TV. Add something unique to your value proposition, something to stand out and appeal to your target audience. It can be a custom print on a bucket, a 2-hour delivery, or an ergonomic handle, but your bucket must stand out as better suiting their needs.
Write one compelling sentence in your business proposal persuading a customer to buy your services. Would it compel you to buy your own product?
Always refine your value proposition. Your business is always evolving, and so is your value proposition–they must stay in sync. Testing several value proposition statements can be a useful approach to learning what will get the most traction with your target audience.
3. A/B Test Your Business Proposal
If you seriously want to improve your winning rate, you should start split testing your business proposals.
What is A/B Testing
If you are working in web design or marketing, you are most likely already aware of the A/B testing technique. In an A/B test, you compare two different versions of an element for a particular duration and measure a metric to define a winner.
A. One business proposal consists of 5 pages.
B. Second version consists of 6 pages with one additional page, “About Our Company.”
After running the above test, the results say that business proposal template A is 31% more likely to win. From now on, you know that you can skip the “About Our Company” page and start testing another element of your proposals.
Try to have more than one A/B test at a time, as testing requires several weeks to collect statistically meaningful data, particularly if you don’t have a vast array of clients and you don’t send business proposals very often. Too short a test and too little data can be misleading.
Designing your test
First, decide what your goals are. Rank goals in terms of potential impact and start by testing them one by one.
For example, your goal may be to increase the acceptance rate of your business proposals. You have to analyze possible obstacles to clients accepting your proposal:
- Is the pricing structure clear?
- Is there too much or too little information?
- Does my business proposal look credible?
- Is it easy to accept and sign the proposal?
- Is my layout clear?
- Is there a prominent call-to-action?
Test only one element at a time. If you start with adding a call-to-action element to the final page of your business proposals, then don’t test new pricing at the same time!
There are no readily available tools designed for A/B testing proposals, however, you can design your own A/B test matrix to determine a winner:
It’s quite simple to test various parts of the business proposal with the analytics tools provided in Quote Roller. We’ve designed a proposal analytics module specifically so you can test your business proposals and understand which elements are working and which get no attention or even hurt your chances of winning..
A/B testing is an inexpensive way to learn about possible bottlenecks and optimize the results from your business proposals. As soon as you’ve finished one element, develop more hypotheses and continue testing. Keep the results in mind and apply the insights you have gathered.
4. Cut the Crap
Your business proposal will be read by people, who have very little time to evaluate your offer, business, and you. Focus on the needs of your client and offer working solutions. That’s it!
Keep your business proposals clear, concise and succinct. Avoid at all costs these popular sections and practices:
1. Your objectives, philosophies, mantras and other spiritual practices
These are of little interest to potential customer, and could be boorish. Clients will figure out if you are the right company to work with after one or two phone calls and several emails.
2. Don’t be Mr./Ms. Proud
Some companies are very proud of themselves including phrases like “We are proud to be on the list of Most Pleased Companies of 2012.″ Do not follow this lot. Your customer has a pain that needs attention, and fixating on your own achievements doesn’t help..
3. Don’t pretend to be a shrink
How many times have you stated: “We understand your needs” or “We share your pain.” Customers do not need moral understanding – they need a solution to their problem at a reasonable price, and one which meets deadlines and is professionally executed.
4. Never say “Trust me”
With new clients, you have probably not reached a point of mutual trust in your relationship. Let your experience, presentation and communication earn your trust and credibility.
5. Avoid vague predictions
Don’t assume you have a complete knowledge your client’s business. Some business proposals boast such a wide range of predictions that you’d think the service provider has a crystal ball in their possession. Don’t mention things and commit to things you are not sure are going to happen.
6. Don’t add “Section 29: Tea bags usage policy”
Don’t include sections and pages that were not requested by a customer. Do you like when you ask a man on the street the time and starts tell you about his coulrophobia (fear of clowns)?
7. Never tell a lie
Someone will slip eventually in one of the emails forwarded to a wrong address or during a phone call. Once caught, you will never be trusted again. If you feel unsure about the truth, it’s best to leave it out.
Check also 10 Things I Hate About Your Proposal
Admit when you don’t know something and tell your clients you will get back to them soon as you can with the answer.
5. Do Not Open Your Kimono Outside the Box
What does that mean?
That’s what your clients think when you sprinkle proposals with complicated business jargon, clichés and gobbledygook.
Keep your language simple and clear.
Readers of your proposal will question your possible working relations. If you can’t be clear in your business proposal, perhaps you cannot communicate well during the project either.
There is no clear success formula. Try to improve your writing skills every day, always choosing correct and precise words, eliminating redundancy whenever possible. Try to say things with the fewest possible words. When in doubt, delete it.
Top 25 Business Cliches
Cliches are words, which has been overused to the point of losing its original meaning or effect. You might think these words are useful, but, in fact, they don’t bring any value and waste the time of your readers.
1. Think outside of the box
2. A win-win situation
3. Giving 110 percent
4. At the end of the day,…
5. Best Practices
6. Paradigm Shift
8. Low-hanging fruit
9. Going forward
10. Push the envelope
11. Web 2.0
12. Value-added proposition
13. Take it to the Next Level
15. The 80 percent to 20 percent
16. Maximize customer satisfaction
17. Core competency
18. Drop the ball
19. Let’s take this off-line
20. A leading provider of…
22. Seamless integration
24. Creative destruction
25. Perfect storm
Top 25 Gobbledygook words and phrases
Gobbledygook = nonsense. Don’t use pompous words in long sentences. It complicates things, sparks too many questions, and gets you nowhere.
2. Pleased to
4. Focused on
5. Leading Provider
8. New and Improved
10. 120 percent
11. Cost effective
12. Next generation
13. 110 percent
15. World class
17. High performance
19. Proud to
22. In terms of
23. Value added
6. Present Your Business Proposals
To make it a memorable experience, always present your business proposal!
Don’t just send the business proposal in an email and wait for an answer. Most sales reps don’t bother with presenting their proposals. This will give you a competitive advantage.
When you are presenting your business proposal to a client–be it by phone, Skype call, or a face-to-face meeting–try to follow these guidelines:
1. Customer needs come first
Set everything aside and focus on the core question you need to solve: your customer needs. Make sure you understand what matters to them and build your presentation on top of it.
The more you know your customer, the better your chances of closing them. You can often find interesting facts about your customer and their business on the internet. Resources like Facebook, Linked-In, Hoover’s, D&B and others can give you important details you can use to build your relationship. If you know how to make their day or fulfill their interests, or you can appeal on a personal level, you can improve your chances of a win.
3. Tell a story
Everyone likes a good story. Writers, presenters and speakers know and employ this technique. Ideas sound more powerful, when they are put into real world situations. Gather a pool of several stories to entertain and inspire to your potential client.
4. Make them feel like a VIPs
Your client is important, or at least they want to feel that way. We are all ego-centric to a certain degree, that’s why everything labeled with a VIP tag sells so well – it’s an ego boost. If a client feels that you treat them as a critical part of their business, they will be more inclined to choose you.
5. Visualize your presentation in your head
Artists and musicians visualize their performances (and their audience’s reaction) in detail before going on stage. The trick is to make your brain and body think you have done this before, so you feel more natural and at ease for the live performance. Practice makes perfect because we carry out repeated actions automatically. The result is that you can control your body language and tone more efficiently.
6. Commit to success
Start expecting success instead of failure. Make sure you believe you can and should win the deal before you invest time and effort in creating a business proposal. It’s simple. You must believe in your product or service, and in your ability to sell it.
7. Know your business proposal
As you would never buy anything from a shopkeeper lacking in product knowledge, your clients won’t buy from you if you are unprepared. Look confident and know every line of your sales proposal. Several might have contributed to it, but the presenter should know every detail.
8. Address objections
This is the turning point in most deals. Prepare for answers that will come your way. Anticipate questions your client may ask, e.g.:
- I don’t think you fully understand our problem.
- It is too advanced for our needs.
- Why should we buy from you?
- Is the price right?
Draft your answers and you will not be left gasping for air, desperately searching for answers you don’t have.
7. Define Clear Next Steps
Give a customer fewer choices and they are more likely to select the direction you have outlined.
A common mistake is not defining on clear next steps in your business proposals and when you make contact with customers. They like proactive sales reps with a simple straightforward process and take responsibility for planning and execution.
Always explain to your customers what to expect next. If a ball is in their court, make sure you know what to anticipate and be ready for it.
Since most of the communication when you are sending your business proposals happens via email, let’s define the structure of a successful actionable email:
1. Compose direct subject lines
The subject line is the first thing your customer sees when opening their email. Take advantage of this opportunity to stimulate action.
Make a habit of using eye catching subject lines in your emails, which would look like a to-do list in any client’s inbox, e.g.:
SIGN: Suggested workload for Iteration 1.
CALL WED 10am: Agreement terms discussion.
REVIEW: Proposal for Cleaning Services at St. Longtown.
Ideally, your subject line should contain 80 percent of the message. Your client will be thankful for your brevity and clarity.
One more trick to raise awareness of your company, is to include your company name in the subject line:
Quote Roller: When would you like to discuss the project in more detail?
2. Ask Questions
If an email contains no questions or actionable steps, it’s just a narrative. The goal of an efficient sales email is simple –to get a response.
Your recipient doesn’t want to look rude and will most likely reply to emails that have open-ended questions.
Your questions should be to-the-point, demonstrate your understanding of your business, and that you’ve done your homework before the initial contact.
3. Final Call-to-Action
Giving your client a specific action pared with a specific date and time makes it more likely that they will complete that action.
Send emails that end with a suggested course of action. Human psychology studies show that most people prefer to be guided and given directions. That means that your customers prefer you to tell them what to do, that you define the agenda and they follow your lead.
When you are sending a business proposal, don’t make it a possible final contact with a prospect. Always include an action line in a final paragraph, e.g.:
John, I’d like to call you tomorrow and present our proposal via Skype. Will 10am work for you?
Martha, I’ve booked a table for us at Green Lakes for 3pm this Thursday, so we can meet and discuss the proposal in detail. I’ll give you a call on Thursday morning to remind.
Chris, let’s have a quick phone call tomorrow at 11am, so I can present our proposal in detail and answer all the questions you might have. Should I call you at this phone number: 555 123-4567?
Check also Mastering the Art of Presenting Business Proposals: 4 Ingredients to Win
8. Timely Follow-Up
80% of sales are made on the fifth to twelfth contact.
How many times have sales reps promised they will call you in a few days, and then vanished? Aggressive and timely follow-up (FUP) techniques will increase your closing percentages and make your business proposal stand apart from your competitors.
Consider these numbers:
2% of sales are made in the first contact.
3% of sales are made in the second contact.
5% of sales are made in the third contact.
10% of sales are made on the fourth contact.
80% of sales are made on the fifth to twelfth contact.
However, most customers never hear from a seller again after one or two initial contacts. When sending a business proposal, it is crucial to follow-up with your clients as fast as possible.
Nobody likes stale FUP calls and letters. They taste like flat soda, and the more you delay a follow-up activity, the colder the lead becomes. Here are two main rules for an efficient FUP:
Rule #1: Follow-up immediately.
Rule #2: If in doubt about whether to follow-up or not, always follow-up.
Follow-up calls are very effective when it comes to moving your sales proposals to closure. It takes no more than 30 minutes to get through most proposals and shape questions and concerns.
Don’t leave your clients with too many open questions. The best time to address them is right now.
Your timing may vary, depending on a business proposal length and complexity. Calling between half an hour and 2 hours after the quote is opened can really help you stay on top of issues and keep you out in front.
Quote Roller provides you with the information you need to strike at just the right moment. The moment your b usiness proposal is opened, you get a real-time notification and can see what sections were read carefully and which were skipped, so you can prepare better for the FUP call.
9. Make It Easy to Accept and Sign Your Business Proposals
The urge to buy can be changed within seconds, and you might lose a potential deal.
Doing business with you should be easy. A lot of purchase decisions are made irrationally and your goal is to make the process of contacting you and signing and accepting your business proposals intuitive and unobtrusive.
The impulse to buy can be changed within seconds, and you might lose a potential deal.
Using PDF or Word documents makes it more difficult for your customers to accept when the mood strikes. Although PDFs allow e-signature, your clients need to have Adobe Reader installed and have their e-signature set up to be able to sign your business proposal. And Word documents cannot be signed at all. In most cases your customer will have to print the document, sign it, scan it and then send it to you again. Any barriers or inconveniences like this give your clients time to rethink their decision to buy.
Offering your clients a seamless online workflow, complete with electronic signatureы closure will help you close more deals. This can be easily achieved with Quote Roller – you can offer your clients to sign business proposals with e-signature and forget about paperwork that takes a lot of fuss and time.
E-signatures are legally enforceable in many countries and have been available for business since 1996. It is a common practice for many businesses nowadays and can be a valuable addition to your sales arsenal.
10. Business Proposal Checklist
- Can we deliver?
- Can we win?
- Can we profit?
- Is your Value Proposition clear?
- Have you cut out all the crap?
- Is your language accurate and clear?
- Have you defined the clear next steps?
- Is it easy to contact, accept and sign your business proposal?
- Are you ready to present your business proposal?
- Have you followed up with your client?