As daunting as it might seem, learning how to write a business proposal is an important first step for anyone starting a business. Of course, each business comes with its own set of challenges and requirements. For example, the sort of business proposal you’d create for a start-up or small business would be quite different from that of a medium-sized business or large corporation.
No matter what type of business you intend to run, a well-thought-out business proposal is a good safeguard to have in place, and research shows that creating one can help you with everything from securing funding to growing your business.
Luckily, even though your process and the exact format for your business proposal can be unique to your company, there is also a general formula you can follow to make things easier, especially the first few times you write a proposal.
In this article, we'll walk you through the easy steps of how to write a business proposal—including how to decide what kind of proposal you're writing, how you should organize it, and what information you should include.
With these starting points in mind, let's get down to the process. Whether you’re just learning how to write a business proposal or want to change up the one you’ve already been using, you’ll want to break down writing into a step-by-step approach.
The organization is key when you’re writing a business proposal—the structure will not only help you answer the core questions mentioned above, but it’ll also help you create consistent, successful proposals every time you’re pitching new business.
When writing a business proposal, break down the document into these sections:
- Table of contents
- Executive summary
- Project details
- Deliverables and milestones
Step 1: Introduction
The introduction to your business proposal should provide your client with a succinct overview of what your company does (similar to the company overview in your business plan). It should also include what sets your company apart from its peers, and why it’s particularly well-suited to be the selected vendor to undertake a job—whether the assignment is a singular arrangement or an ongoing relationship.
The most effective business proposal introductions accomplish more with less: It’s important to be comprehensive without being overly wordy. You'll want to resist the temptation to share every detail about your company’s history and lines of business, and don’t feel the need to outline every detail of your proposal. You'll want to keep the introduction section to one page or shorter.
Step 2: Table of contents
Once you've introduced your business and why you're the right fit for the client you're submitting the proposal to (a quasi-cover letter), you'll want to create a table of contents next. Like any typical table of contents, this section will simply outline what the client can expect to find in the remaining parts of the proposal. You'll include all of the sections that we'll cover below, simply laid out as we just did above.
If you're sending an electronic proposal, you may want to make the table of contents clickable so the client can easily jump from section to section by clicking the links within the actual table of contents.
Step 3: Executive summary
Next, your business proposal should always include an executive summary that frames out answers to the who, what, where, when, why, and how questions that you’re proposing to the client lead. Here, the client will understand that you understand them.
It's important to note that despite the word "summary," this section shouldn't be a summary of your whole business proposal. Instead, this section should serve as your elevator pitch or value proposition. You'll use the executive summary to make an explicit case for why your company is the best fit for your prospect’s needs. Talk about your strengths, areas of expertise, similar problems you’ve solved, and the advantages you provide over your competitors—all from the lens of how these components could help your would-be client’s business thrive.
Step 4: Project details
When it comes to how to write a business proposal, steps four through six will encompass the main body of your proposal—where your potential client will understand how you’ll address their project and the scope of the work.
Within this body, you'll start by explaining your recommendation, solution, or approach to servicing the client. As you get deeper within your explanation, your main goal will be to convey to the client that you’re bringing something truly custom to the table. Show that you've created this proposal entirely for them based on their needs and any problems they need to solve. At this point, you'll detail your proposed solution, the tactics you’ll undertake to deliver on it, and any other details that relate to your company’s recommended approach.
Step 5: Deliverables and milestones
This section will nest inside the project details section, but it’s an essential step on its own.
Your proposal recipient doesn’t get merely an idea of your plan, of course—they get proposed deliverables. You'll outline your proposed deliverables here with in-depth descriptions of each (that might include quantities or the scope of services, depending on the kind of business you run). You never want to assume a client is on the same page as you with expectations, because if you’re not aligned, they might think you over-promised and under-delivered. Therefore, this is the section where you'll want to go into the most detail.
Along these lines, you can also use this section of the prospective client's proposal to restrict the terms and scope of your services. This can come in handy if you’re concerned that the work you’re outlining could lead to additional projects or responsibilities that you’re not planning to include within your budget.
Moreover, you might also want to consider adding milestones to this section, either alongside deliverables or entirely separately. Milestones can be small, such as delivery dates for a specific package of project components, or when you send over your first draft of a design. Or you can choose to break out the project into phases. For longer projects, milestones can be a great way to convey your company’s organization and responsibility.
Step 6: Budget
There’s no way around the fact that pricing projects aren’t easy or fun—after all, you need to balance earning what you’re worth and proving value, while also not scaring away a potential client, or getting beaten out by a competitor with a cheaper price. Nevertheless, a budget or pricing section is an integral part of a business proposal, so you'll want to prepare your pricing strategy ahead of time before getting into the weeds of any proposal writing.
Step 7: Conclusion
Finally, your conclusion should wrap up your understanding of the project, your proposed solutions, and what kind of work (and costs) are involved. This is your last opportunity to make a compelling case within your business proposal—reiterate what you intend to do, and why it beats your competitors’ ideas.
Business proposal considerations
Before you dive into determining how to write a business proposal that will give you a competitive edge, there are a few important things to keep in mind.
First, you'll want to make sure that you’re accomplishing the right objectives with your proposal. When writing a business proposal, you’re trying to walk a line between both promoting your company and addressing the needs of your would-be client, which can be difficult for any company to do.
This being said, you'll want to remember that a business proposal is different from a business plan, which you likely already wrote for your company when you were starting your business. Your business plan spells out your company's overall growth goals and objectives, but a business proposal speaks directly to a specific could-be client with the purpose of winning their business for your company.
With this in mind, in order to write a business proposal for any potential client, you'll need to establish your internal objectives and how these will contribute to the work you're proposing. To explain, you'll need to consider the following:
- What tasks will be done for this work?
- Who will do each task, and oversee the job at large?
- What you’ll charge for the job?
- Where will the work be delivered?
- When will it be done?
- Why are you the best fit for the job the client needs to be accomplished?
- How will you achieve results?
Not only are these questions at the heart of clear and concise writing, but you also won't be able to write your business proposal without answers to them. So, as you're going through the different pieces of your business proposal, keep in mind the objectives of your business, while also remaining persuasive regarding why the potential client should work with you instead of someone else.
As you’re writing a business proposal to a company that doesn’t know they may need your services, you’ll want to focus on getting them to understand why your company is specifically unique. You want to show them that you can add significant value to their business that they don’t already have. If there is someone currently performing the function you want, the sale will be even more difficult.
The bottom line
There's no doubt about it—learning how to write a business proposal is a lot of work. Luckily, however, you can follow our steps, so you know what to include in your proposal and how to include it.
Ultimately, selling your services to potential clients is part of running and managing your business and as you do it again and again, it will only become easier.