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Standard Format for a Business Proposal

written by: Tomica Bonner•edited by: Ronda Bowen•updated: 11/30/2010

Business proposals are your first contact between you and your potential customer or investor. By preparing a standard business proposal format you will have all information necessary for review. This will ensure that your business remain competitive among other businesses.

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    The Business Proposal

    Use a Proper Business Proposal Format A business proposal is a formal document submitted from a seller to a prospective customer. A proposal tells a customer, investor or banker why it would be beneficial to do business with a particular seller. It should highlight the business's qualities and experiences in relation to the customer's product or service. There is no one size for a business proposal format, it depends on the request of the customer. Once a proposal is accepted it becomes a formal contract between seller and customer.

    There are three important components to a business plan:

    • Executive summary
    • Company description
    • Financial plan
    • Market Analysis

    Once you have successfully compiled the information together this represents your business proposal. Present the documents on professional letterhead with standard type. The business proposal represents your company and is usually the first contact between you and customer. Therefore, all information should remain professional and accurate.

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    Executive Summary

    An executive summary is the first part of the business proposal a customer will read. They should be able to find highlights about your company its business goals. Take the opportunity to introduce your company and its products or services. Provide a mission statement along with a summarization of your marketing strategy and customer base. Keep in mind that this is just a summary and should be brief but provide a relevant outlook of your business goals.

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    Company Description

    A company description is where you can provide detailed information about business plans, project objectives and value proposition. Within this section, a company should be able to explain and justify their business idea in relation to the customer's need. When defining business goals outline your timeline on when you expect to start and finish the project. Be detailed in description by including steps in-between to ensure the outline is complete and answers most questions at a glance. Provide information on your daily business operations and how it positions your company to become successful.

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    Market Analysis

    Create a market analysis within your business proposal format company description to describe your target market and how your product or services will help your potential customers. The purpose of your market analysis is to show who's your potential customer and how many. Provide information about your customers such as: How old are they? Where they live? What is their income? Discuss your approach to this market and how your company is positioned different than its competition.

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    Financial Plan

    When putting together your financial plan include information such as business start up costs and operating costs. Provide statistics that show profits and loss projections. It's important to explain how you plan to remain financially competitive and show a return on investment. Businesses or investors will pay close attention to this section to ensure you have included how you plan to finance your company. The financial plan should include income statements, balance sheets and cash flow statements. You should also develop a projected cash flow statement showing at least the next twelve months. Include information for incidentals and how the company would maintain operation during slow financial times.

    Image Credit: Flickr Orin Zebest