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What Is a Business Proposal?
A business proposal is a written offer from a seller to a prospective buyer, or selling an idea in a formal an structured way. It is wide in scope and could be a request for funding, request to access proprietary information, request for staff or any other request from the entrepreneur to any other stakeholder of the business.
A typical business proposal might include:
- An Executive Summary that introduces the company and its products or services
- A statement of work or technical approach with an implementation schedule and description of deliverables
- A management plan detailing organization of work with milestones
- Corporate qualifications that describe the capability to do the work
- A Staffing Plan
- Contracts and Pricing.
Business proposal ideas to dress up standard business proposals include:
- Covering the basics in terms of “what," “who," “where," “when," “why," and “how"
- Adopting the most relevant business proposal structure
- Adopting a customer centric approach
- Quantifying the business proposal
- Benchmarking with Federal Acquisition Regulation (FAR)
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Dressing Up a Business Proposal: Covering the Basics
The best way to make the business proposal appealing to the investor is to cover all bases in specific terms by addressing the primary questions of “what," “who," “where," “when," “why," and “how."
- What: The business proposal should be clear on the purpose of the proposal and include the competitive advantage of the proposal
- Who: The business proposal needs to detail the person responsible for each specific work component or process
- Where: The business proposal needs to specify the work and delivery location
- When: The business proposal should include all key milestones and deliverables
- Why: The business proposal should substantiate the reasons for making the proposal, and justify the selected course of action by listing the compelling “win" strategies
- How: The business proposal should outline the plan for execution of work, list out possible contingencies, and explain the strategy to manage such contingencies and mitigate risks
The best proposal is the one that lists out such factors in simple terms.
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The Best Business Proposal Structure
The purpose of the business proposal is to convince investors. A good business proposal needs to list upfront the reasons why the investor should invest in the proposal and include explanations and references as an addendum or exhibits. Only when investors find convincing reasons to invest would they examine the rest of the details to make sure the business can deliver what it promises.
The storyboarding approach of developing a business proposal entails building a high-level proposal outline and completing a storyboard containing explanations and references for each item on the outline. This approach ranks among the best business proposal idea structures to convince investors.
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Dressing Up a Business Proposal: The Customer Centric Approach
The goal of business proposal is to persuade investors to invest in the business by answering their questions and clearing their doubts. The best way of doing so is by developing the proposal in a customer centric way so that investors can easily find what they look for.
Some of the most common ingredients in a customer centric business proposal include
- An easy way to navigate proposal documents
- Excellent visual communication and graphics
- Experience citations and examples throughout the text
A customer centric approach also entails drafting the structure of the proposal based on information received from the customer. Some ways of preparing the structure based on customer preferences include:
- Organizing the information chronologically or functionally based on customer preference.
- Seeking information from the investor on the nature and depth of information required and including secondary details such as references, pricing, contractual details, and employee profile only if investors prefer to read voluminous data.
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Quantification of a Business Proposal
Investors look in terms of return on investment and quantifying the business proposal help investors gain a better understanding and make informed decisions.
The business proposal needs to detail the investments and the expected returns in quantitative terms. Quantification of a business proposal entails:
- Including cost/benefit trade-offs in the different approaches and identify the best approach in terms on the best cost/benefit trade-off
- Detailing accurate and properly structured pricing data
- Listing out the acceptable contract terms in quantitative terms such as money, hours, etc.
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Benchmarking Business Proposals with U.S. Federal Acquisition Regulations
Business proposals submitted to the U.S. Federal Government need to follow the Federal Acquisition Regulation (FAR), a primary set of rules that define the composition and formatting requirements as well as the evaluation criteria in terms of a scoring and selecting process.
While a general business proposal need not conform to FAR guidelines, the FAR nevertheless serves as a good benchmark for the following areas:
- Formatting, outline, and submission guidelines
- Outlining the statement of work in terms of what is to be done or delivered
- Determining how the investor will evaluate the proposal and shaping the proposal on such lines
- Providing a cross-reference matrix to allocate everything that goes into the proposal in such a way that it corresponds to the work requirements and evaluation criteria.
Dressing up the business proposal by infusing business proposal ideas to make it more appealing to the investors increases the chances of success.