How to Create a Winning Sales Proposal
Any successful deal needs a sales proposal whether you like it or not. A sales proposal can either make you lose or win a deal. It can help you gain a new client or establish long-term relationships with prospective clients. Keep in mind: a sales proposal lets you pitch a product or service to land new or repeat business – an ideal way of closing deals.
Now let’s talk about the proposal process, shall we?
Before the proposal
Preparation of the proposal
How to present the proposal
How to follow-up
Today’s business people are far too busy to listen to long-winded discussions. Know what your key points are, including the price and learn how to make them quickly.
Use your proposal to show how well you understand your prospect’s problems — and how efficiently you can help them. Don’t over-promise just to close their business. This is the easiest way to increase new client churn rates. Be clear about what you’re offering — and what you aren’t.
Once your proposal is complete and delivered, check in with your client. If they have revisions or additional questions they need to be clarified, make sure you’re able to incorporate them.
Mentioned and Cited In This Episode:
For more information on remote selling and a complete list of links mentioned in this podcast, visit this remote selling article on our website.
Creating Winning Sales Proposals:
What the Wine Industry Knows About Sales Proposals
They say don’t judge a book by its cover, but of course we do that. We can’t help it. We’re visual judging creatures. In fact, judgment is one of our human superpowers. It may not have felt like it at some points in our lives, certainly there have been times I’ve exercised some bad judgment, but generally we make pretty decent judgments and decisions, but how we make those judgments is sometimes surprising.
Take for instance wine. It’s one of those highbrow fancy products for fancy people who like fancy things. Wine itself is a $300 billion industry, but there’s a whole industry of magazines, aficionados, and wine critics who write about and score wine. In my local Whole Foods, most of the wines have rating scores right on the price tag. Ratings are helpful, sure, but that’s not how most people buy wine. Most people, 82% of people in fact, buy wine based on the label alone. A larger percentage of people buy firstly based on price. That is to say people use shortcuts to make their wine-buying decisions, and it’s typically not based on ratings by experts.
If you’re selling a $20 bottle of wine to a $20 bottle of wine buyer, you have a label that appeals to them, they’ll probably buy it. They judged your book based on its cover. It turns out that’s actually how a lot of people buy books, too. In a small online survey, half of the respondents said the book cover was a top five factor in their decision to buy a book. My guess is it was actually a lot more than that.
Your Clients Are Judging Your Proposal
Now, when it comes to writing and delivering your proposals, your clients will make many judgments about what you put in front of them. Sometimes they make snap judgements and sometimes they make more cautious and rational judgements. No matter how they do it though, they’re constantly making judgments. Regardless of your personal feelings about this, it’s just the way we think. It’s what happens. So your proposal process has to take these judgments into account, meet the challenge, and still deliver what your stakeholders need to see long before you get paid. Sound like a fun challenge? Good. Because in this episode of Modern Sales, I’ll be walking you through the proposal process before it happens, the prep work, what to do in the moment, and of course how to follow up.
I’ve organized this episode into four separate parts:
What happens before the proposal?
What happens while you’re prepping the proposal?
How should you present the proposal?
What’s the best way to follow up on your sales proposal?
There is an immense amount of information in this particular episode. I’m going to go through it quickly. I’m sure I will leave some of your questions unanswered. I’ll be writing quite a bit about the content that you hear in this episode. And like I said, it builds a lot on things that we covered previously. So hang in there, strap in, and I guarantee you will walk away with at least three actionable insights from this episode.
Step 1: Before Your Write Your Sales Proposal
Before I write the proposal, there are a few things that I want to make sure of and I’m going to go through a process that is going to most likely lead both me and the client to the place we want to be, which is, for me, obviously, serving this client. And for my client, obviously, it’s being served or having their problem solved. So the three things that I want to happen before I go to the trouble of writing a proposal are, one, get verbal agreement from the client that they want their proposal in the first place, number two, take temperature on the price, and number three, put together what I call a real-time proposal, which you could also think of as a low-fi proposal. So let’s take those one at a time.
The reason I don’t want to just go off and write a proposal is because, number one, I want to make sure that the right things end up in there. And maybe more importantly, number two, I don’t want to waste my time and my client’s time writing the proposal if they’re actually not interested in working with me. That’s why I’m seeking verbal agreement with them.
The second thing is I want to vet them out on price. I want to make sure they understand about what I’m charging in order to work with them. Now, there’s all sorts of things you can follow about value pricing, and I’ve talked about that a little bit here on the podcast. What I can assure you is that value pricing isn’t the right way to go in every situation. It’s a very particular solution for a very particular type of service provider. But the key thing to know is a lot of people treat their proposals as a way to reveal the prices that they’re going to charge the client. I think this is a really bad way to do business. Instead, you can easily give the client a range without having to go through the trouble of writing a full proposal.
So my recommendation is tell the client what the maximum amount is for a project like this. What’s the upper limit? Now, if you’re not sure or if it’s really complicated, you can use ranges. Again, using the top of the range is usually the best way to go about that. You can also say all sorts of things will depend on what the actual price is. But taking their temperature on the price and making sure that you’re within the ballpark is something you want to do before you go to the trouble of writing the proposal because the value that the client will receive is developed in conversation, not in the proposal. There’s nothing you can write in that proposal that’s going to be extremely persuasive to the client. The value conversation really needs to happen one-on-one synchronously in life in either a meeting or a phone call. N.
Now, the third thing that I recommend is something that I call a real-time proposal. The way that works is basically it’s a low-fi proposal that you’re going to give the client. The way the real-time proposal works is when you’re in conversation with your client, you’ll tell them that the next step is to basically write a proposal but that you’re going to just give them a quick outline to make sure that you understand everything and so do they and that you’re on the right track before you go to the trouble of writing this big formal thing. The reason this is so important is that you now involve your client in the creation of that proposal.
There’s something that a lot of people refer to as the IKEA effect, like IKEA the furniture store. And that is IKEA sells a bunch of cheap furniture, but people really love IKEA. Why is that? Some psychologists have speculated that the main reason is because people build their own furniture and then they become more attached to it. They took part in the creation of that furniture and therefore they like it. I personally just like most stuff I get from IKEA. My desk here that I’m recording this podcast on came from IKEA. And yes, of course I built it.
So with a real-time proposal, it can be as simple as putting bullets in an email and sending it over to your client. I prefer putting it into a Google Doc, or Dropbox Paper, or any kind of online live collaboration tool that you have. And tell your client the reason we’re doing this is for you to give feedback. That’s the specific reason. It’s also very informal which takes the pressure off of your client to now say yes or no. What we want to do is invite them into conversation so they can have some control over the final look and feel of that proposal and what actually goes into it.
So before the proposal is written, I’m going to now demonstrate for you how I would talk to my client about this. I would say, “I’m really excited about this project, and I’m sure that we can help you in a lot of different ways. Our next step to move forward and actually provide the service to you is to go out and write a proposal. Is that something you would like?” Then the client will say yes or no. Usually they’ll say yes. And if I haven’t talked price yet, this is where I would talk price, but usually that comes up much sooner in the process.
Then I would say something like this: “I like writing proposals as much as you probably enjoy reading them, which is not that much. So one thing that I like to do is just put together a quick outline that I can send over to you and you can tell me if we’re on track or not. If we are, I will go off and write a formal proposal that you can review and review with your team, and we could probably be done with that in a day or two. Are you open to giving me some feedback?” Okay, so that’s before I write the proposal. That’s step number one.
Step 2: Prepping Your Proposal
If I’m prepping, what I need to know now is who is going to look at this proposal. And importantly, what I want to do is present this proposal live. I don’t want to just email it to someone once it’s written. The reason I want to do it live is that I want it to be a conversation where my client and all the other stakeholders in the meeting are able to voice their concerns, hesitations, whatever objections they have about what I presented. I really want to know what that stuff is because one big mistake a lot of us make with proposals is we treat them as if they’re written in stone, and of course they’re not.
The intention of a proposal is to further facilitate the conversation toward a conclusion in the sale, right? That’s what we want it to do. We want it to make things a little bit more serious, elevate the commitment a little bit. But essentially, I want to put what I understand in writing, give it to the client, and see where we stand. So it’s really important to know who else will be there. What other stakeholders will be looking at this proposal? And importantly, who else will be there when I do present?
So when you go to the trouble of writing your proposal, I recommend that you make it very easy to both understand and share. Chances are when you send that proposal off there will be people reviewing it who have not been privy to your conversations. There will be people reviewing it who are not privy to inner departmental issues. And there will be people reviewing it who don’t know you whatsoever, which means it has to be somewhat self-explanatory and it has to be quite easy to share. So rather than sending a PDF, if you send someone a link to a site, what that allows you to do is make sure anytime someone who views that link is viewing the most up to date and current version of that proposal. Whereas with PDFs, sorry, they’re going to be out of date pretty quickly, especially if you’re running a fairly nimble and agile process.
And finally, what I want you to do is present this live instead of asynchronously. What a lot of people will do is have a couple of meetings with a client, write the proposal and send it over email, and tell the client, “Let me know what you think.” Well, I’ll tell you what I think about that. That is a bad setup. What I want you to do instead is set a meeting whereby you’re presenting your proposal live to everybody in that meeting. If you need to ahead of time, feel free to send the proposal the day before.
Here’s the thing, most people won’t even read it. And here’s the other thing, if you send your proposal over email, almost certainly, what most people will do is skip directly to price. Price, of course, only matters in the context of value. And that, my friends, is why I highly recommend you present your proposals synchronously. So that’s the prep.
Step 3: Presenting Your Sales Proposal
You’re probably wondering what in the heck should go into the proposal? Well, here’s the basic format. Where is your client now? Where would they like to be in the future? And how will you get them there? Before, after, bridge. That’s our basic sales story. Same idea presented in a little bit more detail is this: where your client is now, what’s causing them to be stuck, where they would like to be, and what you’ll do to help them get there, so a description of your service.
Now, if you’re interested in presenting with slides, and I do recommend this when you’re presenting to bigger groups, this is what I call the rule of three. So if you have one or two people you’re presenting to, feel free to just review the proposal as you wrote it. Because if you’re presenting to one person, it’s your client champion, right? The person who initiated the conversation and who can make the decision. Whatever they see is gospel, right? And if they’ve been the one working with you on your real-time or low-fi proposal, then whatever you present will be old news more or less. But if you’re presenting to three or more people, showing them a long document, 5, 10, 20, 40 pages, is not going to be very productive. I do believe what you need in that situation is slides, and the slides should follow the same basic format, before, after, bridge. Where’s your client now? What causes them to be stuck? Where do they want to be, and what will you do to help them get there?
There’s also things that you can anticipate will come up in these conversations, like who’s on the project team, what kind of case studies do you have, and more, of course. When you give your presentation, whether it’s live in the same room, or remotely, or wherever, in a conference room somewhere, you should really know the presentation style and have command of your environment. So if you’re in your client’s conference room, you should get there early, and set up your computer, and have a clicker, and check the batteries, and all of those kind of really simple, dumb tech things that can really make you look bad in front of your client if you don’t have command of them. So definitely know the presentation style.
In terms of once you start presenting, I would always start with an agenda. Always tell everybody, “Here’s why we’re here today. Here’s what I’m going to cover. And here’s what I hope you do as a result of it.” And as part of that agenda, I always want to communicate that this is intended to be a conversation. I am not here to wow you with my PowerPoint or Google Slides abilities. What I am here to do is talk about how we can help you. That’s the goal. If at any point someone has a question, if at any point someone wants to interrupt, by all means please do it.
Also as part of that agenda, I’m also going to say, “And by the end of this presentation, I want you all to make a decision. And that decision is, are we going to work together or are we not going to work together?” Now, the truth is, of course, in a room full of several people, let’s say five or eight, whatever, decision makers, people watching this presentation, it’s unlikely if the decision-making power is desegregated that they’re going to have a decision right in the moment. The reason is they’re going to need to confer with each other while you’re out of the room. But having this as part of the agenda sets the tone, which is you want to know whether you’re going to be working with them or not. And they should want to know that also so they can either quickly move on to someone else or something else or get started, because that’s why you’re here in the first place.
Now, a quick note about any objections or things that you can anticipate may come up, an inkling that you have that one of the decision makers has an issue with you or this project. Whenever you sense that something is off, whether someone says it directly or not, we’re going to address it right head on. The reason we do is that if we choose not to address it, what’s going to happen is it will probably blow up the deal. So uncomfortable as it may be, it’s much better to address these issues head on rather than ceding the power to a conversation that we will not be a part of. I’d much rather honestly respond to any feedback that I get or honestly respond to any objection that I hear and tell my client the truth, tell my client what I think about what they said or what I think about their concerns, whether they’re well placed or not. I want them to know that, and I want to be part of that conversation. So do lean in whenever you hear any discomfort, any hesitation, and certainly any direct objections.
Step 4: How to Follow Up On Your Proposal
After you leave that room or after you end your Zoom meeting, however you did your presentation, I write an email detailing what we discussed. I also send any collateral that I presented. So if I had a slide deck, I send them that. If I have a formal presentation, I send them the formal proposal that they can sign and pay for online. I also send them an invitation to follow up for a decision if that is what was decided. If instead the client says, “Yes, let’s get started,” then I send an invitation for a kickoff to be scheduled. Either way, we want a date on the calendar. This thing is not done yet.
At the end of this presentation, there are only three possible outcomes, and those are a yes, a no, or we need to think about it. If it’s a yes, again, it’s not done yet. I need a signed contract, I need to receive payment, and we need to schedule a kickoff. If it’s a no, we’re all done. And if it’s I need to think about it or we need to think about it, then I want a date by which they’re going to make a decision.
By the time you reach the proposal phase, depending on, of course, the length of your sales cycle, but by the time you reach that phase, you and your client probably know each other decently well, certainly over a few weeks in most cases, but usually over a few months or maybe even years. So it shouldn’t take them all that long to make a decision. You can put it in their hands and tell them, “When do you think you’ll have a final decision?” And usually they’ll say within a week. For whatever reason, that’s kind of the go-to answer. And I would always look to put a time on the calendar to get that final decision so that they know that they’re expected to make it by a certain date. So that’ll be sent after the presentation meeting.
Tips to Improve Your Sales Proposals Now
That is a quick, lightening-fast summary of how to present. I do want to give you a couple of action items and then the key takeaways. So for action items, if you’re not doing everything that I said in this episode, and this is my process so you’re probably not doing it all, here’s what I recommend:
Get verbal agreement before you write a proposal
Always take temperature on the price
Always present your proposals live
Only take the time to write a proposal after receiving verbal agreement from your client on their desire for a proposal and a rough budget range has been established
Use a real-time proposal to secure agreement with your champion prior to presentation
Know your audience and present to them live, facilitating a conversation rather than a slide show
Ask for a decision at the end, knowing that you’ll probably not have a final answer if there’s more than one or two people there, but you should get a date for a decision
Always follow up with what was discussed, the collateral, and an invitation to finalize the decision or proceed with kickoff
Are you presenting but your clients aren’t understanding the value you bring? It may be your approach to value-based selling.
Do you feel confident in your sales presentation, but you’re losing control of your meetings? How to run a great sales meeting turns out to be a science.
Are your presentations going well, but you’re not sure how to deal with objections? Addressing objections is critical to completing the sale.