Published In December 2000
A proposal’s primary objective is to persuade your customer to take specific action, including contracting your products and services. Often you will write a proposal in response to a request for proposal (RFP) or request for quotation (RFQ) that the prospect and/or consultant sends. In the present market to win a customer, or to retain an existing customer, you will usually face strong competition. A good written proposal often represents your only opportunity to stand out from the crowd. When writing your proposals it is important to remember that your contact will not be the only one to read your proposal. There will be others who have not had the opportunity to listen to your verbal message and will be developing their opinions and recommendations on your written proposal. People with direct influence on the decision of the project are presidents, financial officers, consultants, management, and technical staff. That is why your proposal must stand on its own merits and consistently convey your intended message. The proposal must be a consistent reminder of the features, advantages, and benefits (F/A/B) of your product and service for the customer. This point is especially important when you are required only to submit your bid. Proposals need to be clear and concise, but above all, tailored to the customer’s benefits, needs, and future wants. Proposal objectives The appropriate choice of words can strengthen any presentation. It is necessary to separate the benefits of your proposal from your technical solutions to their problems. Words, therefore, become your tools. They can be soft and appealing or strong and powerful. You can use short words to add strength and force to your presentation or to provide direction and encourage action. The following is a list of suggestions: * Know the customer and their needs and wants. * Know your capabilities, product, and service. * Know the prospect’s motivation to buy. * Understand the F/A/B concept. * Keep your writing natural and conversational. * Get to the point: omit needless words. * Avoid using abbreviations and clichés. * Keep it direct, focused, and simple. * Edit and review your proposal. * Remember the proposal is about your solution tailored to the specific customers’ wants and needs. When writing a proposal, it is important not to write more, but to write better. The quality of your words, not the quantity, will bring the desired results. Before you start, consider the following recommendations: * Paper stock—60# (Thin paper gives a “cheap” look to proposals. In addition, there is no benefit to using heavier stock or linen paper.) * Paper color—white, off white, light gray, or tan are acceptable. Bright colors are perceived to be unprofessional. * Type—Gothic, Times Roman * Size—12- to 14-point texts and 18-point headlines Any logos that need to be printed should be of the same stock and color as the rest of the proposal. Standardizing your proposal will give you a consistent representation and will project an image with consultants, engineers, and architects that becomes familiar. Once you have your materials, it is time to assemble your proposal. The marketing proposal consist of six sections: * Introductions * Specifications * Quotation * Summary * Terms and Conditions * Literature Each section should address the motivation to buy. Let’s investigate each section in detail. INTRODUCTION The Introduction section has four parts: * Cover * Company history * Staffs’ qualifications * Success stories COVER * Center the following: * Customer Name and Title * Company’s Name * Location (the location of presentation and location of the project) * Four line returns * Your Company’s Name and Title * Date of Presentation Place the following information on the lower right-hand side of the proposal cover * Bid Due Date * Bid # * Bid Received By (if you have to only submit a proposal for review, always get a signature of who received your bid) Bottom of the cover (centered): * Validation Terms—Proposal Valid for (30, 45, 60, 90, 120) Days. Because this is your company’s offer of commitment, there are two reasons why it is important that you have Validation Terms. First, it is a legal document that requires you to do the work as stated in the proposal and at the price stated. If there is an increase in the cost of materials, unless you’ve spelled it out in your proposal that you can change the price at any time, you may be forced to absorb the additional cost. Second, having a date gives you and your customer a time frame in which to work. It will also give you a reason to contact the customer giving you the opportunity to answer any question or objection, discuss competition, or just encourage the customer to take action by asking for the order. History of the company This is your opportunity to discuss the beginning, present status, success, growth, and anything else that will project strong roots, stabilization and longevity of your organization. The purpose of this section is to appeal to the customer that you have identified as “SECURITY” minded. We need to project a strong image that we have proven our capabilities over the years and that the organization will be around in the future. Staff’s qualifications In Part I, which ran in November, we discussed “ACHIEVERS.” This section is for them. We want to display our expertise and our staff’s education. Display the modernization of your present company and your attitude and progressive plans for future markets. Most important is to project the image that you are dedicated to efficiency and effectiveness is your business philosophy. Success stories This is the section in which to discuss your major accounts. Discuss the size and scope of the organization and how you play an important part of their growth, upgrade, and modernization. This will appeal to the third buying motivation, which is “RECOGNITION.” In this section, you want to convey the feeling of belonging to a prestigious list of accounts. You want the “RECOGNITION” type to feel that you want them to be apart of your list. Specifications * Copy of the technical data sheet or bid, RFD, RFP—Specification Sheets, or all other customer-produced technical data sheets, should be included in your bid. This will help other readers who are unfamiliar with the specification to avoid confusion. Experience with doing proposals has taught us that somebody other than the main principals will have questions about or objections to your response to a particular article. Because these people were not part of the development of the original bid specifications they do not realize that you were responding to their own company’s requests. By adding the specification sheets you can avoid any misinterpretation of your proposal’s response to individual articles. * Response to technical data sheet—This is your solution to customer needs and wants. It is advantageous to respond to the technical data sheet in a positive manner. You accomplish this by addressing each article or group of articles. For example: Article: 1 to 10 met and agreed or accepted. Address 10 or fewer articles per response. You want to make a long positive list. Listing all the articles with your positive response will give the customer confidence that you can meet its needs and wants. It will also help you to offset any discrepancies by showing more positive than negative responses. (This is known as the Benjamin Franklin Close, where you explain to the customer that Benjamin Franklin made his decisions based on how long his list of positives and negatives were. Whichever list was longer, that was the direction he would take. We are using the same strategy as the Benjamin Franklin Close by producing a list of positive responses, offsetting the list of discrepancies or negative responses. n Identify discrepancy by article number—Response to discrepancies requires creativity. You have to turn a negative into a positive. First you must respond to each article discrepancy in a less conflicting or contrary manner. Example: Article: 6 met and (revised, or with change, or amended.) You want to convey that you have met or exceeded the specification even if it is not exactly as written in the data sheets. If you cannot meet the specification, you must describe the benefits of your product and solution (F/A/B) versus the data sheet specification. This is not easy, but customers always want a positive solution in responding to their wants and needs, while giving them a comfortable and confident image towards you and your company. To project a positive image, you must always respond positively. * Summarize your proposed design/ build solution—Certain questions must be decided on before starting a design/ build project, such as: * Do you have the resources to design this project? * Can you use your in-house engineering without significantly sacrificing the operation of your business? * Will it be more effective and cost efficient to use outside engineering firms? * Is there a requirement for a certified BICSI member? * Do the Manufacturer’s Programs offer Design/Build engineering services? (Most manufacturers have BICSI certified estimators) * Does your distributor have a design/ build service? (Most distributors have BICSI-certified estimators.) * Is it better to pool resources on a project by developing a Partner or Joint Venture relationship with another organization? After answering these questions, you can develop your design/build documentation, which is added to the proposal and includes: * Equipment and material specification * Equipment location * System riser diagram * Copper/fiber optic cable type * Cable routing and support * Power layout and supply requirements (unique to ECs) * Surge and data protectors/ suppression (unique to ECs) * Grounding and bonding layout (unique to ECs) * Other required information After gathering the completed data, review it with internal personnel and also with the customer. It is important to involve the customer so they feel a part of the design of their project and you show your interest in producing a proposal design to meet their needs and wants. * Product specification—Technical Data of your proposed product. In describing your product, whenever possible, use F/A/B, which was described in November, when Part I of this article ran. Describe the feature, the advantage of having this feature and the benefits to the customer that will be derived from this feature. * Timetable/progress charts, graphs, and drawings—Layout your proposal based on the time frame starting with the Validation Date that was used on the cover of your proposal. This will give the customer a starting point of reference to better understand the timetable to get to the date of completion. (Most customers want the installation to be completed as soon as possible or yesterday.) QUOTATION * Total price—If possible, give a single price for the complete project. There are several reasons why you want to do this: First the customer, in most cases, is working with a single budget number that has already been approved internally for this project. The project cannot exceed that number without going for prolonged budget change requests. In a large organization, that can terminate a project before it even starts. Second, this is your starting point for price negotiation. It is easier to discuss a single price point than to discuss individual pricing for products/services with time and material. * Discount percentage—Manufacturer, distributor, cash, or any other discounts you want to pass on to the customer should be shown as a percentage of the total. * Finance price—If the project is being financed (there are finance companies that will not only finance products and material, but also labor) display the monthly payments based on the total price. * Time and material rates—Labor and material rates during the time of the installation. These rates are based on your personnel still being on the job site installing the original project. Fact is that the customer will always have changes to the project during installation. * Equipment option price list—Cost of products that are not part of the original specification or are part of your suggestions in your proposal. Example: power supply, generator, surge protection, lighting reflectors or electrical maintenance service review for cleaning up the power and/or monitoring the grounding layout. * Moves, adds and changes(MACs)pricing—Cost of material and labor after completion of the original project. Labor fees are based on hourly rates with product materials that are higher from original project pricing. * Maintenance fee—In VDV markets, a maintenance contract may be required. Contracts should be shown on a yearly, monthly, or per-call basis. SUMMARY * Reason your company should be awarded the bid—Summarize your proposal on how you met the wants and needs of the customer. Highlight the benefits you provide to the customer while still meeting the specifications. Explain your organization’s plan to support the customer needs today and in the future. This is the section where you take the opportunity to explain the reason that you deserve this project. Remember that others, not part of the daily evaluation, will be reading your proposal and introduction to your company for the first time. They have not had the opportunity to hear your verbal presentation and the reasons you deserve this project. Executives who are not involved with the daily process but have direct responsibilities for the project might include presidents, comptrollers, consultants, and technical staff. The Summary section may be the only section they will take the time to review. TERMS and CONDITIONS * Contract or agreement—Include a fill-in contract that can be signed by the customer. It will allow you to encourage the customer’s decision by discussing the terms of your contract. If the customer suggests that you review their companies’ contract, this indicates the decision is being made. In either case, you want to discuss a mutually agreeable date that you can start on the project and what your obligations are. If you are discussing contracts, you should be asking for the order! * Warranty agreements—Show product and manufacturers warranty agreements. If you are part of a Manufacturer value-added program, then the manufacturer gives a 15-year warranty. * Financial agreements—If the customer is financing the project, then the fill-in terms and conditions should be submitted for the customers review. LITERATURE * Brochures for both company and products—Include all brochures that will give the customer the feeling you can perform the project. Company brochures should discuss your history and commitment. The idea is to appeal to the SECURITY motivation. * Press release/company references—Past successes and accomplishments are meant to motivate the ACHIEVER. * Association/affiliation—Customers that are motivated by RECOGNITION are interested with the prestige of your associations and affiliations. Understand and remember this statement: “Proposals are the written solutions to the customers’ problems or needs.” Remembering this statement forces you to create a personalized customer proposal. Such proposals respond not only to the technical specification, but also address the needs, wants, and motivations-to-buy of the customers. In this competitive changing VDV market, whether the proposal is for a new prospect or an existing customer, by becoming more market-oriented in our proposal and in our approach, the electrical contractor can create a distinct advantage over present or future competitions; long-term customer loyalty. MARTIN is a management consultant with the NECA Management Education Institute, based in Morris Plains, N.J. He can be reached by calling (973) 540-1298, or through e-mail at email@example.com.