How to write an effective business proposal

In many industries, it’s common for customers to request business proposals from organizations that are looking to sell them products and services or seeking investments. A business proposal is an effective way for an organization to provide more information about itself and the value of its offerings.

Being able to articulate the value of your products and services can set your organization apart. You have to explain why your offering is unique and how it can meet the specific needs and challenges of your target audience, but you also have to do it in a way that’s interesting and engaging.

If you’re looking to hone your business proposal skills, you’ve come to the right place. In this article, we cover what a business proposal is, what it contains, and how to write one effectively. We also go over various templates you can use to make the task easier.

The background on business proposals

Business proposals are common in business-to-business (B2B) industries and professions. Vendors use them to persuade customers or clients to purchase their products or services.

“The objective is to convey both information and the professional credibility of the person presenting the proposal,” says Lou Haverty, owner of Enhanced Leisure, which sells home leisure goods directly to consumers.

In terms of format, business proposals are formal documents that can vary in length from two pages to several hundred pages, depending on variables like the industry or profession, buyer requirements, the scale and scope of buyer needs, the types of products and services, and other factors unique to the situation.

“This document is crucial in helping the customer understand the feasibility of the proposal, alongside the advantages that would be made available should the proposal be accepted,” says Kenny Kline, president and financial lead at BarBend, a publication featuring strength training and nutrition news and reviews.

A business proposal makes a factual and compelling case for a sale (or the award of a project or funding). It does so by presenting key information, including

• A concise summary of the vendor’s background as well as details about the company, what it does, and what it specializes in
• A recap of the problem the customer needs solved, a concise analysis of the need or issue, key challenges it entails, and its level of urgency
• The solution the vendor is proposing, what makes it unique, and why the vendor is the right company to provide it
• The required resources — such as time, money, and skills — for the vendor to provide the customer with the solution they need

“Sections within your business proposal are entirely driven by your audience,” says Haverty. “This will guide you in terms of length and detail. If your audience is a corporation, they may need much more detail and formality than if your audience is an individual.”

While every business proposal includes the information above — no matter the industry or proposal requirements — it may be organized in different ways (which we’ll discuss in the next section).

There are three main types of business proposals:

• Formally solicited proposals. These types of proposals are submitted to one or more organizations in response to a call for proposals (often, a request for proposal, or RFP) for a specific type of product or service. The customer offers details about the problem they need to solve, and they may even share details about their budget and timeline, as well as solutions they’ve already tried. With a formal proposal, the customer issues specific requirements for formatting, length, deadline, or other things.
• Unsolicited proposals. This is the opposite of the formally solicited proposal. Here, the customer hasn’t requested a proposal from any organization — and hasn’t shared details about any needs. As a result, the vendor must thoroughly research the customer, determine what kinds of challenges they face, and craft a proposal that presumptively meets those needs. Organizations sometimes send out these “cold” proposals to multiple customers at once, personalizing the document for each.
• Informally solicited proposals. Sitting somewhere between the two above situations, informally solicited proposals typically come about when a vendor has had a conversation with a potential customer about an upcoming or anticipated need at the customer’s business. The customer expresses interest in learning more about a solution the vendor has broached, the way the vendor’s company would handle the project or sale, and more information about the vendor’s company if the two haven’t done business before. This amounts to an informal invitation to submit a proposal, which the customer is now primed to welcome. Customers usually don’t specify formal guidelines for informally solicited proposals, and the vendor may need to conduct research into the customer’s needs to create a winning proposal.

Common sections of a business proposal

There’s no one correct way to write an effective business proposal. Variables like customer requirements, project characteristics, industry conventions, and other basic factors will determine the document’s format.

“Each of the sections within a business proposal has its own value, as each of them provides different forms of information,” says Kline. However, certain aspects are typically included in every business proposal, though they may take different forms.

For example, in one business proposal, information about the product may be combined with information about the company, while in another, the two topics may be addressed in separate sections.

Haverty shares a list of essentials for his preferred business proposal format:

“An opening summary of the key points in your proposal (intended for people with limited time); an introduction describing the issue/problem that your proposal will be addressing; specific terms of your proposal, including pricing and performance expectations; and a closing section that explains why you or your company are the right provider of the solution addressed by the proposal.”

He notes, “Using this type of format is important because it provides a logical flow to the presentation. People who have limited time will skip to sections most relevant to them. At the same time, people who have extra time will review the full presentation. Essentially, this format is effective for an audience with a variety of time constraints and pressures.”

Below are the main sections organizations typically include in a business proposal. Keep in mind that you may order them differently or emphasize different aspects in different proposals, based on specific customer or industry requirements.

Cover page

This is the first page the customer sees, so it’s important to make a good impression. The page should include the proposal’s title, your company name and contact information, the customer’s company name and contact information, and the submission date.

Some organizations also include their logo and their customer’s logo on the title page. You have the option to include other branding and graphic design elements here. In any case, it’s good to keep the cover page clean, easy to read, and designed in a way that reflects professionalism.

Cover letter

This element doesn’t appear in all proposals, but it can be an effective way to grab the reader’s attention. It’s a short letter addressed to a specific person at the company you’re submitting the proposal to. The letter thanks that person for the opportunity to submit the proposal, succinctly outlines what’s included, and offers contact information and next steps for the customer to take.

The cover letter often accompanies unsolicited or informally solicited proposals, but it’s typically not required in formally solicited proposals.

Table of contents

While you likely won’t need a table of contents for a short proposal of, say, three pages, it’s a good idea to include one in longer proposals with multiple sections. The table of contents helps readers navigate the proposal and find the information they’re looking for easily and quickly.

You don’t need to limit the contents to section titles — many organizations include level-two and level-three headings as well. This is a useful strategy, as many customers don’t read the proposal chronologically.

Depending on their needs, a reader may skip around to different sections to find the information they’re interested in. A well-constructed table of contents will help them do just that.

Executive summary

The executive summary is a good opportunity for the authoring organization to summarize the proposal for the reader.

Often, this section is one page or less, and it includes an overview of the company, the problems it can help solve, and why it’s the best choice to solve them. The executive summary can also include milestones the company has reached and recent successes.

In some cases, there may be overlap between the executive summary and the cover letter. If that’s the case, the executive summary should build on the details offered in the cover letter.

“For someone who is in senior management, the executive summary holds significant importance, as it allows them to obtain a summarized version of the report and helps them gauge if it’s a worthwhile endeavor from the start,” says Kline.

Problem statement or needs outline

It’s imperative for the selling organization to demonstrate a thorough and insightful understanding of the challenge the customer is looking to resolve. The problem statement or needs outline is where you do that. 

In it, you should recap details of the problem and share key insights that will help solve it. Include contingencies like timing, budgetary constraints, and other consequential factors in your needs analysis.

If you’re aware that the customer’s company previously tried unsuccessfully to solve the problem, you can include a brief discussion of why the previous solution didn’t work.

Proposed solution

Here’s the shining star of the business proposal — the solution your company offers the customer. This section should include details about what the product or service is, how it works, and what value it offers.

Be sure to focus on how the offering solves the customer’s specific problem. You can also include an implementation plan, with a timeline or schedule.

Some proposals include a future outlook as well, with projections of what kind of results the customer can expect in the short and long term. This section is typically one of the longest in the proposal; you can break it down into subsections if needed.

In some proposals, the solution may also include elements on market analysis and strategy.

Pricing

While pricing directly ties in with the proposed solution, it’s best to include it in a separate section because it will be especially important to the customer. This section typically looks like a table or chart and includes different pricing options based on contingencies or variables that might apply.

It’s vital to be as transparent and clear as possible with your itemizations and pricing.

“It is important to determine the costs of the product/project/service as accurately as possible, as it allows the reader to gain an understanding of where the numbers are coming from instead of having vague assurances,” says Kline. “[The latter] would show that the research is incomplete and will discourage the customer. Always have the numbers ready, even those that are not added to the proposal.”

About us

In the “Proposed Solution” section, you’ve described the ideal solution to the customer’s problem; in the “About Us” section, you’ll make the case for why yours is the only company that can deliver it.

In doing so, share details about your company’s vision, mission, and values, as well as who the main players are in leadership and management. In a smaller company, this may include the founders, while in a larger company it may include the head of the product or service implementation team.

The goal of this section is to build the customer’s confidence that this organization is the best one for the job.

Competitive analysis

“The competitive analysis is important, as it provides crucial information on rival companies and firms and where they stand in context to you,” says Kline. “This can serve as an external benchmark and can provide insights into the company’s thought and operational processes.”

Qualifications

This section shares specific industry qualifications or certifications your company has that are relevant to the solution you’re proposing. It should also include milestones the company has achieved or examples of relevant successes the company has achieved with other customers.

Many organizations include word-of-mouth affirmations of their capabilities, quality, or service, such as testimonials or customer reviews. This is a great way to build trust.

Roadmap

It’s important for the customer to know what happens next. If you’ve included in the proposal a schedule for product delivery or service implementation, the roadmap will shed light on the rationale behind it.

Moreover, the roadmap builds on any timeline details you may have sketched out in the “Proposed Solution” section. If you haven’t included a schedule, the roadmap will prime the customer for the scheduling decisions to come.

Terms and conditions

This section is one of the most important in the proposal, yet many organizations don’t develop it enough or even forget about it completely. It’s imperative to include terms and conditions in a business proposal, as they constitute contractual stipulations that will be binding on the deal in question.

These might include payment schedules, project timelines, contingency pricing (such as for overtime), definitions of what’s included and what’s extra (for example, messenger fees, shipping costs, or other ancillary services the customer isn’t directly contracting your company for), as well as how long the offer is valid.

Many organizations work with a lawyer to draft this section of the proposal.

Call to action

This last section of the business proposal can differ markedly from one proposal to the next, depending on the company or industry it represents.

In some cases, the next step will be for the customer to meet with the vendor. If so, the call to action would provide the meeting details or contact information.

If the next step is a contract, it may be attached. and the call to action would be for the customer to sign. It all depends on what needs to happen next to finalize the deal.

Signature field

Including an electronic signature field will make your proposal look even more professional, and collecting e-signatures will save you a lot of time. Your potential client can sign the proposal and send it back to you in a matter of minutes. No need for them to print, sign, scan, and email the proposal back to you. 

Jotform Sign makes it easy for you to add an e-signature field to your proposal. Just drag and drop the Signature element onto your document. You can also upload an existing PDF proposal or choose from one of Jotform’s many templates. 

Every signature you collect with Jotform Sign is legally binding and E-sign and UETA compliant. In addition, every document you send with Jotform Sign automatically becomes part of a workflow and an audit trail, so it’s easy to track approvals. 

Best practices for effective proposal writing

It takes a lot more than a good idea or an elegant presentation for a proposal to be successful. After all, if the content of the proposal isn’t compelling, you won’t convince the customer. 

Follow these proposal writing best practices to make sure your content is captivating and meets the needs of your target audience:

• Personalize your proposal. While it’s certainly easier to write a generic business proposal and send it to multiple customers, it’s more effective to personalize the content. This will signal the effort you’ve put into centering the proposal on the reader’s needs. Our free business proposal templates will shorten writing time so you can focus on what you’re selling rather than how you’re selling it. Make sure to customize our proposal examples for your client to avoid sounding generic or impersonal.
• Follow instructions. If you’re responding to a request for proposal (RFP) or other formally solicited proposal, make sure to follow every guideline you’ve been given. Double-check that you’ve met all requirements to prevent being dropped from consideration. If you don’t, the customer may reject your proposal outright without even reading it, wasting your time and resources.
• Focus on the client, not yourself. The client wants to know how you can help them, not how your company got started. Talk about your products or services only in the context of the client’s needs. They don’t need all the details — just the most relevant ones. For example, if you’re showcasing how your business makes a certain product, highlight the details (such as quality materials and special manufacturing processes) that make the product better, faster, or more effective than its competition — and how those virtues can benefit the customer.

• Remember the problem. “Highlight your audience’s problem and explain how you are best positioned to solve it,” says Haverty. This way, the proposal focuses on what the customer needs, not what you’re trying to sell to them. As a result, it will be more likely to hit the bull’s-eye of what the customer is looking for.

• Speak to the client, not at them. Research the company to get a better understanding of what it’s looking for. Use the organization’s language, such as any company-specific keywords or acronyms. Try not to alienate the client with overly technical language or jargon. If you must use abstract terms, define them. This makes it clear to the customer that you’ve done your homework.

• Be realistic. Set a reasonable timeline that you can actually stick to when it comes to product delivery or service implementation. Account for any obstacles, such as supply chain issues or service disruptions, that could potentially slow down your process. Even holidays can affect the schedule. As much as you’d like to meet every expectation, don’t promise what you can’t deliver.

• Be specific and avoid jargon. Kline explains that, due to the nature of the business proposal, you may need to include detailed descriptions of ideas within the proposal, which may require the use of uncommon or highly technical words. “However, if the proposal goes over the head of the reader,” he says, “there is no use.” He recommends replacing jargon with everyday words and being specific so that the reader can understand without going too deep and getting confused.

• Stay true to your brand. Even though a successful business proposal is written for the client, your proposal should also reflect you and your company. Misleading the client into thinking your company is something it’s not will only lead to disappointment. Many organizations showcase their branding through the design and brand voice of the proposal, and they include information about the company’s mission, vision, and values in the “About Us” section.

• Be a good writer — or find someone who is. A proposal needs to be as persuasive as possible. Write in a professional tone that engages the audience while maintaining your brand. Use positive instead of negative words and active verbs instead of passive ones. Don’t confuse the client with complicated words or long sentences that you wouldn’t want to read yourself. After all, if the customer gets bored or confused reading your proposal, they won’t choose your solution — no matter how perfect it may be.

• Keep your proposal short. Clients are less likely to read a long proposal, especially if they’re busy executives. Include nothing more than the information the client needs. Delete anything that doesn’t add value. Having a good editor on your team can help you trim the content so it’s concise, relevant, and free of superfluous information that the customer doesn’t need to know. “Ideally, business proposals are succinct and easy to read, and they lay out the key things to know about the business transaction so that all parties are comfortable moving forward,” says Haverty.

• Proofread. Any typos or grammatical errors will tell the client that you didn’t take the extra step to give them a polished proposal. If you couldn’t do that, how can you deliver the best results when working with them? Here’s a pro editing tip: Put the proposal away for at least a day after you’ve written it. Come back to it with fresh eyes, and you’ll be able to see a lot more typos than you would have otherwise. “It is extremely easy to run the proposal through grammar checking software and proofread it so that any confusing sentences can be weeded out,” says Kline.

• Put your best foot forward. “Major things to avoid include excessively long proposals, unneeded details, mistakes, bad grammar, and other things that might make your proposal look unprofessional,” says Haverty. “With a business proposal, [there are situations in which] your presentation and the professional image you convey [can become] more important than the substance of the proposal.”

Proposal templates to make writing easier

Starting a proposal from scratch can be a daunting task, so why not streamline your efforts and improve productivity with a template? Jotform offers several fully customizable business proposal templates — giving you a head start in creating a business document that wows your customers.

Regardless of which template you use, you can adapt it to ensure you meet the client’s requirements.

“If the prospective customer cannot comprehend the solutions you are offering in your business proposal, it will be dismissed. Always keep your customer’s needs in mind when writing the proposal, and customize [it] to address the customer’s needs,” says Kline.

Here are a few of the proposal templates we offer:

• One-page proposal. If you have a small, quick project coming up, this short template is a great way to convince your customer to make the deal. It includes all the important sections of a proposal, including tables for itemizing parts, equipment, and costs — as well as an e-signature to get the final sign-off.
• Mobile app development proposal. This proposal template has everything app development companies need. A sleek design and all the important categories for details — including the mobile app development process — make this template a great place to start.
•  Construction bid proposal. This template is ideal for construction companies. It has sections for scope of work, payment structures, and other parameters unique to the construction industry. The template has a simple, modern design.
• Nonprofit business proposal. This proposal template is the perfect document for organizations focused on impact and purpose rather than profit. It aims to help secure funding or commitments from stakeholders for the next big project.
• Marketing proposal. This template is perfect for marketing agencies looking to work with new clients. You can use it for a number of different marketing projects, and it’s fully customizable to accommodate the scope and specifics of the work you propose.
• Music business proposal. For musical artists and companies alike, this proposal template is a great way to secure investment or partnerships for musical endeavors. 
• Research proposal. This template is ideal for academic environments and businesses. It includes sections for details of a particular study and a plan for managing data, as well as other key sections that are unique to research.
• Catering proposal. For anyone in the food business, this catering proposal template is a useful tool for acquiring new customers. It has special sections for menu items, so a caterer can use them to showcase enticing specialties that will help close the sale.
• Interior design proposal. This stunning template is ideal for organizations where visuals matter. It includes all the generally relevant sections of a design proposal as well as sections specific to the interior design industry, with an appropriately classy and sophisticated design.
• Contractor proposal. This proposal template is industry agnostic, and both private and public companies can use it. The template includes all the relevant business proposal sections, which are easy to customize for whatever industry you’re in.

The effective business proposal: A final tip

As we’ve discussed, a business proposal is important if you want to grow sales for your organization. (No pressure, right?) We hope the information in this article brings you one step closer to creating engaging and incisive business proposals that win sales.

If there’s one aspect to remember when writing an effective proposal, it’s this: Always personalize the proposal as much as possible so it’s clear to the customer that you created it specifically for them and their needs.

AS ALWAYS, CONSULT AN ATTORNEY BEFORE RELYING ON ANY FORM CONTRACT OR  CONTRACT TEMPLATE. THE CONTENT ABOVE IS FOR INFORMATIONAL PURPOSES ONLY.