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What Is a Business Proposal?

A Business proposal is a written document sent to a particular client in order to get a targeted project or a job matching our skills.

A business proposal is a value proposition written formally on papers between the seller and buyer.

Business proposal is usually two types Solicited or unsolicited.

Solicited Business proposal:

Here clients or buyers whom we target will get to know about our services actively seek proposals that meet their specific requirement.

This process happens out of a formal discussion between a buyer and seller.

Unsolicited Business proposal:

when buyer and seller happen to meet at dinner at a trade show or on some business outing accidentally.

Out of an informal conversation if the seller tells the buyer that he has some solutions for her/his products and then buyer asks him to send the proposal it is called as unsolicited proposal.


Important acronyms in Business Proposal used in Solicited proposal from Vendors:

RFI (Request for Information):  This tool helps the client understand the information about the services of vendors and client decides to choose the best vendor depending on RFI.

Request for proposal (RFP):

Once the client chooses the vendor, he will send a document or a proposal briefing what he wants from the vendor and how the proposal needs to be organized and presented as per their requirement.

RFP helps the vendor to understand what the client exactly requires.

Request for Quotation (RFQ):

Once the client likes the proposal, he/she will request for quotation of our product.

This document explains regarding monetary terms, availability, delivery time and other specifies of the product.

Purchasing decision will be taken by the client once he likes the terms in quotation.

Invitation of Bid (IFB):

IFB’s are used based on the price of the vendors, and clients will send the bidding invitation to the vendor. Bidding happens and then vendor who bids least price will get the project.

Unsolicited Business Proposal doesn’t have the above process the vendor directly send the proposal to the client.

If the proposal satisfies the client’s requirement, he/ she will get the project or the business ends there before it starts.


Business Proposal Format:

Step 1:

Title Page: It includes vendor’s company like company name, contact Information Company’s logo and client’s company name and contact information, the date and title.

Proposal looks very neat and decent.

Step 2:

Cover letter of Business Proposal:

Cover letter is the face of Business proposal. When we approach client with business proposal, we will not jump directly explaining the proposal.

Firstly, we need to give a one liner description about the company background and short note of information describing the USP of the company.

Cover letter should be very pleasant and it shall increase the curiosity of the reader to reach us with some questions.

In the end close it with a thank you and a signature.


Table of contents:

As per the length of the Business proposal contents need to be indexed in order of the page content along with page number.

This will make the reader more comfortable in reading the proposal. He/she will directly go to the page they want and will be impressed by our proposal.

The Main Body:

Main body of the proposal includes the actual content of Business proposal it shall be mentioned clearly in bullet points and small sentences.

Paragraphs should not be crowded, matter shall be divided into small paragraphs and written neatly and clearly.


Here we will get into more details and try to convince the client that we understood his requirement and we have an apt solution for their problem.

We also need to explain the client that we have the capacity to face the challenges that come across while providing solutions.

Approach shall be in such a way that it shall also add a personal touch to the client which will convince the client to take up our proposal.


This section in the Business Proposal contains what solutions we have planned to deliver as per their requirement.

Every term mentioned in the price list shall be explained in this section to maintain transparency with the client.

Project milestones:

List the important aspects in the Project into several phases which is explain the client clearly how the project will progress.

Highlight the key areas and deliverables of the project, resource assigned for each   give realistic reasoning for each deliverable which will be more effective and tempting to the client.

Budget and Pricing:

This is the main portion of Business proposal; here we have to maintain the profit margin to win the clients.

It will be a healthy relation with the client if we maintain transparency and clarity and show all the costs accurately.

It will be clearer if we maintain the costs incurred in the form of a table so that it will be easily understandable and negotiations will be easy with the client.


About Us:

In this section we have to sell the company by showing their website explaining who we are and what our company is all about.

Vendor need to highlight their USP (Unique Selling Point).

Awards, Social proof, testimonials, realistic case studies have to highlighted to the client.

In this section client gets familiar about the vendor’s company and will have a mind frame about the company.

Clients and References:

In this section existing clients have to highlighted showing the client that we are providing solutions to their requirement and have the capability to satisfy their requirement.

Impressive clients shall be selected and mentioned to impress the to be client.

Terms and Conditions:

This is the final section of the body all the terms and conditions and provide information about the company have to be written here.

Call to action button should be placed here.

Call to action button can be anything it can contact us or inviting the client to visit the website.

This section serves as a conclusion and it reiterates and concludes what the vendor and client are promising each other by agreeing the proposal.’

In the end we need to specify the duration of the agreement, the timescale of completion, payment types and final dates.


Terms of Payment in a Business Proposal:

Billing Schedule:

If we want to maintain a perfect and positive rapo with the client one need to maintain the invoices schedule, follow and stick to the tight payment schedule.

Total budget for the project:

Firstly, client have to pay 50% of the initial fees at the point of signing the contract that will be deposit, remaining will be billed monthly as per the usage of resources, services, and hours spent on the project.

Client’s Agreement to pay:

These terms in Business Proposal differ from company to company depending upon their services, rules of the company and the project.

If the payment is delayed from the client the vendor has the right to charge some percentage for late payment and also, he/she has the right to stop the work until the payment is done up to date.

Collection Costs:

These are the miscellaneous costs like legal fees, costs and disbursements to collect the invoices, interest for late payments.

The above-mentioned terms shall be clearly mentioned in the Business Proposal to the client for the smooth going of the project till the end without any confusion or clashes between the vendor and the client.



It concludes that a Business Proposal should have all the terms that the client is looking for and terms shall be mentioned transparently and clearly to avoid any misunderstanding or clashes between the client and vendor.

Yoganand A

Hi, I am Yoganand, Certified digital marketing Trainer in Hyderabad India, Entrepreneur, Digital Marketing Consultant and speaker having 10+ years of Experience in digital marketing Field.