When and How to Present a Proposal – Six Rules

Just because you’re asked for it doesn’t mean you should provide it – yet. And when you do, it should inspire.

(Part 2 of 3)

Irony abounds. Sales professionals tend to hedge and delay when asked the “how much does it cost” question as we reviewed in Part 1 of this series, but we’re quick to scramble to put together a proposal almost as soon as a prospective customer asks.

We should do the opposite.

As with jumping to the “how much does it cost” question, it makes sense that prospective customers are quick to ask for a proposal. It’s a clear, easy, concrete request to make and most buyers haven’t been trained in how to evaluate and purchase something. Asking for a proposal after an initial discussion is a simple and seemingly logical thing to do.

When to Deliver a Proposal

A formal proposal is one of the LAST things we should provide to a prospective customer. It must be complete and clear, and there’s no way that we can deliver such a proposal early in the sales cycle.

A formal proposal is one of the LAST things we should provide to a prospective customer.

Sales professionals should be constantly summarizing and feeding back to their buyer their understanding of the situation – requirements, objectives, timing, pricing parameters, etc. This can be done in emails after calls or meetings, in formal summary of understanding documents, or in ‘what we’ve heard’ sessions at the beginnings of presentations.

The important thing is to make no assumptions and continually validate – and challenge when necessary – the understanding of your buyer to ensure you and s/he are talking about the same thing and working collaboratively toward the same goals. No guessing, no speculating.

It is only at the end of comprehensive discovery and differentiation activities when you’ve received indication that you’re a viable vendor or even a finalist that a formal proposal should be delivered – though you’ve been doing the work to prepare it all along.

Then you do so with incredible thoughtfulness and care.

How to Think About a Proposal

Proposals are ambassadors. An ambassador is the highest ranking official representative a government can place in a foreign country. They are charged with representing policy, negotiating agreements and protecting their citizens within a host country. It is a position of tremendous gravity, honor and prestige.

Our proposal must serve as our ambassador within the buying organization, speaking for us when we’re not there

Our proposal must serve as our ambassador within the buying organization, speaking for us when we’re not there and communicating to decision makers with whom we’ll never meet, like the CFO approving the spend or the purchasing committee reviewing a requisition request.

For this reason, a proposal is perhaps the most important document that you can prepare throughout the sales cycle.

More often than not, the proposals that are delivered to customers are repurposed pieces of crap that are unreadable

But what happens? More often than not, the proposals that are delivered to customers are repurposed pieces of crap that are unreadable. Sales reps do a find/replace on company name, update a pricing table, and deliver the same voluminous nonsense that they deliver to every other prospect. Nonsense that they in all likelihood have never read.

It’s amateurish and disrespectful, and it should not be allowed to continue in any sales organization.

Six Rules of Good Proposals

Proposal Rule #1 – No Surprises

A proposal should be a formal summation of an understanding that you and your buyer have already established. There should be no surprises at all. Pricing should have already been reviewed in another format, important commercial terms discussed ahead of time, and delivery schedules considered as part of an engagement planning process.

The only thing your buyer should be surprised by is how clean, accurate, thoughtful and gorgeous your proposal is

The only thing your buyer should be surprised by is how clean, accurate, thoughtful and gorgeous it is, because they have been trained by lesser sales professionals to expect uninspiring proposals as the norm. They should be surprised by how inspired they feel reviewing yours.

Proposal Rule #2 – Decision Makers Don’t Read

You barely read the material that your own company produces – why should you expect a senior executive at your prospective customer to do something you yourself can’t be troubled to do?

Make your proposals clean and readable. Lots of white space, lots of crisp bullet points. Stick to the facts and make the document easily able to be skimmed. Strike large blocks of text and complicated graphics that you pilfered from some product team’s PowerPoint. If it doesn’t add clarity, it takes away. Get rid of it. If you must, place expansive detail in the back of the proposal in an appendix section.

Assume that the CFO at your prospective customer has the attention span of a 15 year-old boy sitting in class on a Friday afternoon

Assume that the CFO at your prospective customer has the attention span of a 15 year-old boy sitting in class on a Friday afternoon and you’ll be just about right. Structure your proposals for them.

Proposal Rule #3 – Show the Math

You’re asking your buyer to spend their money on this project instead of another, and with you instead of somebody else. Do them the courtesy of showing the math to support why that’s a good idea. It’s hard to argue with math. It’s math. Outline a clear and concise business case – what you expect your solution to deliver, over what period of time, in real dollars – either savings, revenue growth or both. Try for both.

Always, always, always include some sort of business case that shows the outcome of what you’ll deliver in real dollars

Always, always, always include some sort of business case that shows the outcome of what you’ll deliver in real dollars. This is table stakes. This is not optional.

Then make sure that your pricing explanation doesn’t require an accounting degree to decipher. See rule #2.

Proposal Rule #4 – It Must End

Please, I beg of you, include an expiration date. Anytime you deliver a summary of pricing, put an expiration date. Every quote you send, every time. And especially in your proposal.

I beg of you, include an expiration date

You know from your Engagement Plan by when your buyer needs to make a decision and complete all paperwork and signatures to meet their desired outcome – so put it in there. That’s the expiration date. It helps you, it helps them, it helps everybody.

Proposal Rule #5 – Make it Beautiful

While there is absolutely no empirical data to support this, we will assume for the sake of this discussion that all ambassadors are so strikingly handsome and gorgeous so as to make one’s heart skip a beat. So too should your proposal be. These are not to be white papers, they are to be compelling messages of premium value and extraordinary experience.

Convince your marketing organization to lend you a designer

Convince your marketing organization to lend you a designer and then spend time with them on layout, fonts, imagery and readability. You’ve trimmed most of the junk already by making the content readable and clear, your designer should be able to turn back to you a proposal layout that’s more engaging than anything your sales organization has produced…ever.

Proposal Rule #6 – Make it Repeatable

You can’t keep that designer forever, and sales professionals need to be self-sufficient, so ensure that all of this work is done with an eye towards repeatability and scalability. There are a number of ways to do this.

I like using PowerPoint as opposed to MS Word. Word demands that users possess an advanced degree in ‘How to Format Stuff Without Losing Your Patience and Smashing Your Laptop to Bits.” It also invites verbosity. PowerPoint is much easier for layout changes and the nature of it forces lots of great whitespace. An easy Page Setup change and – voila – you’ve got yourself a portrait oriented document that’s facing the “right” direction for a proposal.

Upload into Google Slides, fix some formatting, and now you’re cooking with a document on which your team can collaborate, copy and share. You’ve got an artifact in which best practices, positioning and content can be shared throughout your sales organization.

Extra credit to those who print, bind and hand deliver their gorgeous proposals to the buyer in creative ways

Reminder: always print to PDF – don’t deliver a proposal in its native format. Extra credit to those who print, bind and hand deliver their gorgeous proposals to the buyer. With some chocolates. Or tchotchkes relevant to their business. Something. Anything. Set yourself apart and show that you cared enough to take the time to do something special and different. Pressing ‘send’ on an email with an attachment isn’t doing something special and different.

A great alternative is to subscribe to a SaaS service that automates this process for you. One of the best companies for this is TinderBox and it provides sales automation tools for everything from presenting through proposals contracts in a platform that integrates directly with your Salesforce.com instance.

If Nothing Changes, Nothing Changes

Regardless of the tool or service you use, commit to treating your proposals with the respect they deserve. You and your teams work too hard during the sales cycle and spend too much energy crafting a compelling value proposition to diminish that effort so badly with a sub-standard proposal. A little care and attention with this critical deliverable can make a world of difference.

How to Handle the “How Much Does It Cost” Question – Part 1

It’s a fair question. “It depends” is not a fair answer.

Interested is seeing a sales professional stumble and squirm for a bit? Ask them how much what they’re selling costs.

Anyone outside of the selling profession can be forgiven for thinking that talking about price would be one of the first things we learn as sales professionals. After all, the concept of pricing and cost is one of the most central and fundamental components of a business transaction. Trading money for something is the quintessential representation of a value exchange.

Those of us who make our living selling know that it’s not that easy.


We’re taught how to  dodge the question by well-meaning sales leaders.

No one really teaches sales professionals how to handle the question. What we’re taught is how to dodge the question by well-meaning sales leaders who tell us that we should defer the question until later in the sales cycle. That we should be selling on value. That we’re to understand the budget of the buyer first. That we’re not supposed to show our cards too early.

Those positions aren’t inherently wrong. They just don’t answer the question. And it’s a fair question. Prospective customers have a right to ask their salesperson what a solution costs, and we have a responsibility to give them a clear and direct answer.

We have a responsibility to give prospective customers a clear and direct answer.

For anything that’s not a fixed good with a readily quoted unit cost (professional services, enterprise software, consulting, etc.) the pricing tends to be variable and that’s part of what makes it difficult to provide an answer early in the sales cycle.

Most customers haven’t been trained in how to evaluate and purchase something.

Most customers haven’t been trained in how to evaluate and purchase something, and they may only do it a few times in their careers. As professional sellers, who do this all day, every day, it’s our job to help them frame their thinking around “price” or “cost” in a manner that will allow them to make the most informed decision.

What something costs is one factor among many in a purchase consideration. For less sophisticated buyers, however, price is the most concrete factor and the most logical to which they can go, which is why they ask about pricing so quickly. Even more sophisticated buyers can press the price question early. It’s easier.

“It depends…” are the two words that most commonly tumble out of a salesperson’s mouth when asked about price.

We know that early in the cycle we don’t have enough information to provide an accurate price – the prospect isn’t clear on their requirements, there’s more for everyone to learn, etc. This is why “it depends…” are the two words that most commonly tumble out of a salesperson’s mouth when they’re asked about price. We then proceed to explain, using far too many words, why we can’t actually give them a price. But that doesn’t answer the question and it frustrates the buyer.

Provide a framework with your response.

Here’s how to answer the question.

Provide a framework first – this gives your prospective customer a sense of what goes into your pricing and why you structure it the way that you do. Don’t just give a number. Explain to them the components of your pricing. What they’re asking for (the price) isn’t what they actually want to hear (which is how you’ll help them determine value to their organization.) The framework gives structure to the how you’ll help them determine that value.

For example, if you sell enterprise SaaS software, this is sample framework:

There are three components to our pricing model – annual subscription, utilization, and professional services.

  1. The annual software subscription is the cost for accessing the core platform that we’ve had in market for years and continue to enhance and improve.
  2. The utilization is a variable component based upon how much you plan on using, and this is different for every customer. (Note: ideally this utilization is based on whatever the value metric is – users, storage, messaging volume, API calls, etc.)
  3. Professional services costs are based upon real human beings doing work to help implement the software and train you on its use and are scoped with you as part of the project planning.

So that’s it – we price on those three things: annual subscription, utilization, and professional services.

Our average selling price when you combine all three of those components is about $300,000. Lots of things impact that, which is why we always setup a discovery and strategy session with your team to help map out a path and plan. We’d like to do that once we both have a sense that there’s a good fit between what you need and what we do. That session will allow us to provide you with a thoughtful and accurate proposal, which will be based upon the value you’ll receive as a business across those three components.

Then stop talking. Please. Stop. Talking. Let them process what you’ve just told them.

This framework gives the prospect’s brain what it wants.

What have we accomplished? We’ve given a structure to our pricing model that the customer can consider. We’ve given them buckets into which they can place their assumptions and ideas to organize their thinking. The human brain likes to organize into groups (for example, grouping everything our eyes see into semantic neighborhoods.) This framework gives the prospect’s brain what it wants.

We’ve structured what we deliver into three discrete functions instead of one monolithic block, which allows us the opportunity to articulate not just a general value statement, but specific instances of value in each of those areas.

We’ve also established some qualification criteria – for both us and the prospect. If they hem and haw all over the $300,000 number, then we know something is off – either there’s total misalignment, we’re talking to the wrong level of buyer, something. But we now know that we have work to do, and we know that early in the cycle.

It also helps the buyer understand where this kind of purchase fits into their budgeting cycle, levels of approvals that will be required, etc. It establishes a baseline so we and the prospect can work together to craft an engagement plan to guide the evaluation. 

It doesn’t really matter what you’re selling or what the pricing structure is – always provide a clear and consistent framework.

There are infinite variations and ‘what if’s’ that come up with the question of positioning price, but I contend that it doesn’t really matter what you’re selling or what the pricing structure is – the method of providing a clear and consistent framework allows you to help educate the buyer with how to think about your solution and it puts your initial, general price figure in some context. Use a framework, pick the right three things to be in the framework, and then answer the question by introducing the framework.

Without context a number is just a number. Maybe too high, occasionally too low, never just right – so spend your energy on articulating the framework, not equivocating on a number.

A structured response should roll off the tongue of every sales professional in your organization.

Practice this with your team and colleagues. A structured response should roll off the tongue of every sales professional in your organization. You and your teams should feel empowered to answer this perfectly appropriate question early in the cycle – because it will be asked early in the cycle – and to answer with clarity and conviction. Doing so is a signal of professional competence that your prospects will appreciate it and it will be a point of differentiation from your competitors.

This post is the first in a series of three on the subject of discussing price and cost in selling situations. The next two topics are “When to Present a Proposal” and “How to Frame Your Price Negotiations.

When and How to Present an Engagement Plan

In last week’s post (Stop Calling it a “Close Plan”) I wrote about the criticality of incorporating into the sales process a mutual plan with the customer. I continued by calling attention to the folly of sales leaders using terms internally (read: Close Plan) and not expecting that some of their troops in the field would, consciously or unconsciously, use those same terms directly with customers. Words matter, and leaders have a responsibility to choose them carefully and deliberately – for their teams repeat what they say.

I recommended as an alternative to Close Plan the term Engagement Plan (Evaluation Plan is another good substitute) and promised that I’d review what I’ve found to be the best approach for presenting and structuring such a plan. I’ve also included a link to download a sample plan layout at the bottom of this post.

When to Present The Plan

When we consider the sales stages with which sales organizations manage a qualified deal cycle, we’ll find a discovery stage at the beginning. This observation is akin to stating that the sun will come up in the morning. Every sales engagement must have as its foundation deep discovery.

Immediately following that is a stage in which we look to establish clear answers to the “why change? why now?” questions. When we know that an evaluation exists, that the customer has agreed that they are going actually do something and they are considering doing it with us – that’s when we present the Engagement Plan.

An Engagement Plan is not a tool to be used at the end of the deal to make sure you get it in for the end of the quarter. It belongs at the beginning, when it can most help.

The intent of this plan is not to help us close the business. It will help us do that, and it will dramatically improve the chances of that happening – and at the highest possible value – but that is not the intent. The intent is to help the customer conduct their evaluation thoroughly and responsibility and to move through their engagement with us in a clear and deliberate manner.

Our Customers Need Help Buying

Our prospective customers don’t know how to buy what we sell. We spend all day, every day thinking about our particular corner of the market and the solution we have been trained on, believe in, and – in some cases – truly love. Our customers do not. They have demanding jobs with requirements that go far beyond just procuring our particular type of product, something they likely do no more frequently than once every few years.

As stewards of our company, our industry and our profession, it is our responsibility to help our customers through this process – independent of whether or not the end result is a sale or order that benefits us. That’s what professional salespeople do.

What to Say

When I have my teams present an Engagement Plan to their prospect, the objective is to help share all of the steps that we know a company must go through to conduct a complete and thorough evaluation to find the right solution to meet their business needs. The words they use are quite literally something like:

“Look – I know that you don’t buy (marketing software / spaceships / combat robot waffle irons) every day. But we do this all the time, and our customers have always found it to be helpful to have us put together an Engagement Plan with them. We’ll include all of the things that typically have to happen for a complete evaluation so you don’t miss anything, and then we’ll go through it with you. That way you’ll have a full checklist with dates, all working back from the day you told me you wanted to have this live and ready. Would you find that to be helpful?”

Many sales executives resist doing this, however, and as a result this incredibly useful tool – a tool that sets clear steps and dates for everyone – goes unutilized. Why? Putting aside those who are simply lazy or undisciplined, some sales executives feel uncomfortable – they fear that the customer will resist this as a tactic designed to get them to buy something. And the customer should resist it – if it’s a tactic designed to get them to buy something. But if the real and true intent behind the presentation of this plan is to help the customer, independent of outcome, then they will welcome it.

Be Conscious of Your Intent

Motive and intent. Motive and intent are the differentiators here. They are the differentiators everywhere. When we approach a situation with an intent that is clean and a motive of helping others, people respond. It is human nature. We are then in a position to help and to be of service. If we are providing the absolute right solution to solve their problem, if we are clear about the value we deliver and the business case that supports it, then an orderly and smooth business transaction is a natural extension of this alignment. When we detach from outcomes, all finds itself in order.

Components of the Plan

Some items to consider when you’re crafting and presenting an Engagement Plan:

  • Include anything that you know most buyers don’t think about, even if it’s not always necessary. An example is a security review by IT. They may not need to do it, but you want to find that out sooner rather than later. This is not a monster under the bed – it won’t go away just because you’re not looking at it. Surface these things as early as you can. Nothing kills the timeline of a deal and gets in the way of the customer getting what they need like an IT security review. See you in six months.
  • Do not make the last item in the plan the signing of the contract – that is self-interested and self-serving. The signing of the contract is the beginning of the next phase for the customer, which can include things like project kickoff, key milestones for the customer, etc.
  • Ensure that, if possible, you review this plan in person. Go through each item, confirm the necessity of its inclusion, validate that the target dates you’ve included are attainable, and note any changes or comments. Then revise the document and send to them.
  • Use the review as an opportunity to ascertain decision making authority, purchasing protocol, approval chains, etc. Remember – this is about helping your customer attain what they need to solve their business problem. A clear understanding of the process helps the customer get what they need in the time they need it, and sales professionals are better than anyone at figuring out that process. If it feels too early in the cycle to dig into those items, don’t – but list them and tell your customer that you’ll come back to them in a future review.
  • Revisit this plan with your customer routinely. Just like an entrepreneur’s business plan, an Engagement Plan is never right the first time. Or the second time. Or the third time.

For a sample layout of an Evaluation Plan, click here to download. This plan is an oversimplification, but provides a general framework for how to structure a plan that will work for you or your team. Tailor the particular line items to reflect the important milestones in your deal process and the important steps for your customer to consider. Remember – the intent is to help your customer conduct the most thorough evaluation they can.

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