Do’s and Dont’s of Writing A Business Proposal
An excellent and well-written business proposal is a must for entrepreneurs because it’s the key to growing your business. It greatly increases your chances of getting funding right from the start. There are many ways on how you can do it the proper way. At the same time, there are rules on what not to do when writing up a business proposal.
Take a look at our recommended Do’s and Don’ts to land that crucial contract.
Define What Market Gap Your Business Proposals to Address
Business ideas often come from recognizing gaps in current markets that haven’t been filled in. For that, you can nail a business proposal simply by answering the question, ‘what is the gap that needs to be filled?’ You will need a thorough understanding of the business’ or brand’s micro-economic environment as well, including knowing which factor could influence demand in the respective niche or market.
Write In Proper Format
Businesses expect entrepreneurs and those who are seeking partnership to know how to write a proper business proposal. As a default, it should be professional, kept to one or two font and colors to paint a consistent theme. We can’t stress enough proofreading for the most common errors, e.g., grammar and spelling mistakes, which can ruin any semblance of credibility your proposal may have. Pay attention to detail and you’ll show your investor that you have the right attitude to get their funding.
Most entrepreneurs won’t have the time to write up a unique format, so they use customizable business templates. Afterwards, fill in the fields and you’ll be good to go.
Be Realistic – Use Sensible Numbers
Investors can see through numbers and if they’re inflated or just right. You can show your calculation by not having an exact, specific number. You can write down that you’re expecting revenue of £4,555,001 by three years’ time, but who will believe you? It’s better to have a forecast revenue of £4.3 million, give or take forecasts and market elements down the line.
Product presentation should have a realistic tone and not a whimsical one. As such, the evidence is needed and backed up by extensive research. It’s not unusual to have partnerships and additional resources so you can achieve your intended growth rate and revenue.
Graphs and charts can really help convey the information you need for easier understanding. In the same vein, your forecasts should be easy to comprehend so your backer will know whether it’s a profitable venture or not.
Tackle Dangers Directly
Most of the time, investors will want to know the risks involved with your proposal first. You can do a good job of convincing them by showing them that you know, identify and understand the risks and are prepared, or have a plan of tackling them head-on. It could be in the form of resource deployment, strategic positioning, competition, market demand and others. Then, write up a section on how you will insure and mitigate the risks.
Answer Their Most Obvious Questions
Here’s a checklist of questions you should answer in your business plan.
‘How does your product work?’
‘How much will it cost to make?’
‘How much have you already invested?’
‘Is the intellectual property yours?’
‘How much money will you need?’
‘How will you use the funding?’
Convince Them On Why Your Project Is Worthy
After you show the investor that you have a thorough understanding of the market, it’s time to show them how your product or business fits in the bigger picture.
You will need to state your product’s USP, or Unique Selling Point, which separates you from all the others. Also, you will need to put emphasis on your business’ current status, including its progress and up-to-date sales. Include a helpful description or outline of what your business does, who runs it (or a team, for that matter) and more importantly, how the investor can get back his or her money.
Be Slow to Act
Acting on a great idea is often the start of entrepreneurial success. When that lightning bolt hits, you wouldn’t want to have it slip away when it’s still fresh. Write it down, then work on the basics such as concept formulation, execution and needed funding.
Don’t wait for too long as you may lose the spark, or motivation that could propel your proposal from idea to reality.
Overlook The Competition
As novel as your idea is, there’s always a product or service that could compete with it.
As part of your brainstorming, consider the possible competitors and how they could execute the idea better. Then, do a short pros and cons list and see where they are weak or are in need of improvements.
Competitors can rise up quickly once they realize there’s a new idea that could threaten their sales or business targets. Do you have a proposal that could lessen or mitigate their actions?
Follow these do’s and don’t of creating a business proposal and you’ll be well on your way to a grant, and ultimately, success. Don’t be afraid of putting in the work as it pays off well in the end.