What is a Formal Business Proposal and How to Write an Amazing One

With so many businesses competing for the same clients, your ability to create exciting and persuasive formal business proposals that stand out and communicate your business's expertise and value will have a huge impact on the success of your business.

Creating and presenting formal business proposals will be will be one of your main tools for acquiring new clients, especially in B2B sales. The key is to make your business proposals stand out so the client wants to buy from your company. Your company may be more experienced and provide a better solution than your competitors, but if your business proposals are boring and unable to impress potential clients and separate you from your competitors, your ability to acquire new clients is going to be very difficult.

What is a Formal Business Proposal

Simply put, a formal business proposal is strategic sales-based business document that you use to present your company and the solution you want to offer to a potential client to persuade them to buy from your company instead of buying from one of your competitors. 

Sometimes a formal business proposal needs to be prepared in response to a RFP (Request for Proposal). A RFP is when a company, organization, or government agency sends out a document (their RFP) outlining a product or service they want to buy, and then they invite qualified businesses to send formal business proposals that detail why they are the best vendor to supply that product or service.

What is the Purpose of a Formal Business Proposal

Businesses, organizations, and government agencies request that businesses send them business proposals as part of a formal selection process for buying goods and services, be it a product (e.g. office desks) or a service (e.g. management consultation). The purpose of a business proposal is to make a logical argument for why your company is the best choice for supplying that product or service.

While some business proposals are little more than a basic price quote that is mainly focused on the proposed fee for selling a product or service, most business proposals must cover a very wide range of factors other than price. Here are the most important business proposal elements:

• Explain how your company will meet the exact needs of the company who wants to buy the product or service. You need to present a strong solution that details exactly how you will implement your solution and why it will work. To increases your chances of winning the sale, you’ll need to present a customized solution based on the company’s RFP and your own research.
• Explain why your solution is the best solution to fulfill the client's needs. This potential client probably has probably received business proposals from several of your competitors. You need to explain why your solution is the best choice and provides the most value to the client.
• Explain what are the expected costs for implementing your solution. If it is a product, explain how much it will cost and provide justification for that cost. If you are selling a service, explain your pricing methodology and why your service provides great value and ROI based on the results you will achieve for the client. A formal business proposal, unlike a price quote, is focused on the value and return on investment you will provide to your client. You may have the highest costs, but if you explain clearly how the client benefits more from buying from you than your competitors (more value, higher ROI), you will have a very good chance at winning the sales contract.
• Explain how much time it will take for you to complete the project. Companies operate under strict timelines, so it’s important that they know exactly how much time it will take for you to implement your solution or deliver your product.
• Provide proof to confirm why you are the absolute best choice for this project. Here is where you explain your experience, capabilities, past awards, and any other supporting materials you have that prove the quality of your product/service and the results you achieve for your clients. It’s not just about listing all your skills and knowledge areas. You need to align them exactly to your client’s needs. If for instance the client wants onsite technology support, you can mention your experience related to the technology systems they use and provide case studies and references to prove how you have helped other similar companies solve the exact same problem this potential client wants to solve.
• Include any other additional information requirements specified in the RFP. Business proposals may also include credentials, certifications, staffing plans, and any other important information required by the RFP.

What Makes a Winning Business Proposal?

A business proposal is essentially a very high quality and in-depth sales presentation. You are selling your business's products or services to a prospective buyer and trying to prove to that buyer why they should choose your company instead of one of your competitors.

A winning business proposal will explain why your business has the resources, expertise, and experience to meet a client's exact needs.

A winning business proposal directly addresses the decision maker within the client's company using persuasive language, well-laid out plans, and a solid understanding of the company’s measurable goals.

To make your formal business proposal stand out as being unique, visually attractive, and far superior to the proposals of your competitors, it is highly recommend that you use professional business proposal software such as ClientPoint to create an interactive multi-media business proposal.

While your competitors will be sending them boring pdf files that all look the same, with ClientPoint you can create technologically advanced multi-media business proposals that will make your company look far more advanced and professional than your competitors, and getting that extra boost that makes you stand out will most likely be the difference between you winning and losing a sales contract.

For more information on writing business proposals, here is a step by step article we wrote on how to write a business proposal.

Win more clients by creating impressive digital business proposals, price quotes, and contracts using ClientPoint Software

If you want your business proposals, price quotes, and contracts to stand out and give you the best chance at winning new clients, use ClientPoint's business proposal software. It makes creating and formatting professional business proposals, price quotes, and contracts fast and easy. Click the button below to get a FREE demo of ClientPoint.