Sales Proposals

…why, when and how?

Rejected proposalThe presentation of a proposal often leads to what has become a common problem; the supplier believes significant progress is being made and they expect a response but the prospect becomes un-contactable and/or previously discussed actions and timescales are forgotten.

Proposal: “a plan or suggestion, especially a formal or written one, put forward for consideration by others.”

Three points jumped out at me when I read this definition which might explain this misunderstanding:

Plan or suggestion. Many of the proposals that I review fail to put forward a plan but lots do make suggestions or try to commence a discussion.  For a proposal to stand the very best chance of producing a successful outcome it must present a plan for the delivery of what has already been discussed and agreed between the supplier and buyer. Using a proposal to “make suggestions” or have a discussion is a recipe for failure.  Documenting suggestions before a meeting may be a useful part of the process but this document is NOT a proposal.

Selling tip: Do not provide a proposal until every aspect of the problem, and your solution, has been discussed thoroughly and all points of contention have been resolved. The proposal documents what is already agreed.

For consideration by others. This raises the next big issue that contributes to proposals becoming interminably stalled or failing altogether.  If your proposal is going to be reviewed by people you have never met the chances of that proposal failing increase significantly.  Your proposal can only be based on what you have been told by the people you have met and while they can give you an impression of what might matter to others who will review your proposal those impressions can never provide a complete picture.  How many times have sellers been told “sorry, I liked the proposal but the FD didn’t”?

Selling tip: Take the time to find out the name and position of everyone that will be involved in reviewing the proposal and do everything you can to meet them or at least speak to them on the telephone. If you do end up with decision makers or influencers where you have had no direct contact you will need to work hard on your contacts to ensure you know as much as possible about their decision making criteria.  One of the most important parts of a proposal is the Executive Summary .

Formal or Written.  Written documents, paper based or electronic, are still the most common format for proposals and in many cases they are the appropriate format to summarise and document an agreed offer.  Note the word agreed; the proposal should contain nothing that would be unexpected or new to the prospect. The cardinal rule of proposals is NO SURPRISES!

An alternative approach that we have found to be very effective is to present your proposed solution in a workshop with all the stakeholders who will be involved in the decision. Using this interactive format does permit you to; make suggestion, float ideas, try out alternatives and the end result is a consensus as to what the solution should look like. Following the workshop you will simply need to confirm what is now agreed and for a simple case that can be in an e-mail and for more complex situations you will present a plan including a schedule of activities and the timetable for delivering them.

Selling tip: At an early stage in the engagement cycle with a prospect agree the process, format and timing for the creation and presentation of the proposal. It’s all tied to their buying process.

OK, so why, when and how:

Why produce a proposal?  Most business sectors, industries and markets come with a set of this is how it is done behaviours and habits.  For many B-2-B environments the habits will include formal, probably written, proposals.

Business tip: have a rigorous, proportionate process in place to review all opportunities ensuring the deal is something the business; wants, can deliver and stands a reasonable chance of winning.  Such reviews should be conducted at key milestones from first contact with the prospect through to a final review before committing the effort to produce a proposal.   

Why not consider breaking the mould; the supplier should ask the prospect how they would like to proceed and whether a written proposal is what they want.  If it is agreed that a proposal will be done the supplier should produce it with the sole purpose of documenting and confirming what has already been agreed and accepted during conversations with all stakeholders in the prospect’s decision making unit.  The proposal is then useful to both parties as it functions as a common understanding of what will be done, by when and for how much. It defines the obligations on both parties thus avoiding many of the potential causes of conflict once the project is underway.

For larger opportunities prospects may have a formal process including a number of steps such as; Request for Information, Request for Proposal or questionnaire type tender documents. If this really is the way the prospect wants to proceed, the supplier will have to play to the rules, but there is always scope to provide a compliant response whilst also taking the opportunity to present an option that differentiates you as a supplier.  This technique is at its most powerful in situations where the tender request demonstrates that the prospect is ill informed on some aspects of the problem or alternative solutions.

When?  The proposal should come after all points of discussion and negotiation have been resolved.  It is also important not to present the proposal too early in the decision cycle; it should be the only thing left to do before the prospect is ready to make their decision.  There is a sound argument for presenting a proposal in two steps; the first describing the solution you are proposing and why it might be the best and then separately, once the prospect has accepted your solution, you confirm (you will have already discussed it) your quotation for providing the solution.

Just to be clear; a quotation is NOT a proposal unless you are quoting for something with a recognised publicly available specification or something the prospect has bought from you before.  A true proposal effectively represents a specification for a bespoke solution.

How?  The only answer to this question that really matters is; as agreed between the supplier and buyer.  If the market or business sector has accepted ways of doing things this may be the way forward but challenging the norm may produce a better result for all concerned. For the supplier, challenging the norm with a better idea will help to differentiate them from their competition.

Further reading; timing of a proposal or  proposal production or getting your proposal due consideration