Business
Fact-checked

At WiseGEEK, we're committed to delivering accurate, trustworthy information. Our expert-authored content is rigorously fact-checked and sourced from credible authorities. Discover how we uphold the highest standards in providing you with reliable knowledge.

Learn more...

What Is a Business Proposal?

Karyn Maier
Karyn Maier
Karyn Maier
Karyn Maier

A business proposal is a written proposal presented from a vendor that is intended to elicit business from a prospective buyer. It differs from a business plan, which is primarily constructed to obtain start-up capital by detailing the organization and operational aspects of the business to demonstrate its profit potential. A business proposal is also unique because it contains much more than figures and statistics represented by pie charts and graphs. In fact, the former involves proposal writing, which is designed to identify and target a specific market and solidly demonstrate how the bidder can deliver custom solutions to the needs of buyers within that market.

Business proposals vary in scale and intended audience. For instance, a small business may direct a limited number of proposals in batch to larger companies in the hope of establishing new lines of business. On the other hand, a company may draft a proposal in response to an invitation to bid on a specific project made public by a private company or government agency. These two scenarios represent the two basic kinds of proposals, which are solicited and unsolicited.

Business proposals may contain figures and statistics represented by pie charts and graphs.
Business proposals may contain figures and statistics represented by pie charts and graphs.

An unsolicited business proposal can be thought of as collateral marketing material, such as a brochure. They are largely broad spectrum in that they don’t address a particular company by name or attempt to close a sale. Instead, this kind of informal proposal is created to introduce a product or service to potential customers through direct mail distribution, by leaving the material behind after a “cold” sale call, or making printed information available at trade shows.

A business proposal is written in response to a request for proposal.
A business proposal is written in response to a request for proposal.

A solicited business proposal is quite different and much more detailed. As previously mentioned, a company or government agency may publish a request for bid proposals on a certain project, also known as a Request for Proposal (RFP) or an Invitation for Bid (IFB). Since the project is usually offered to multiple candidates simultaneously, the proposal submitted by the winning bidder will generally meet the specific requirements of the project but at the lowest price.

There is yet a third kind of business proposal, however, and that is an informal solicited proposal. While this is similar to a solicited proposal in terms of being an invitation to bid, it is generally extended to only one vendor at a time. In fact, this opportunity most often stems from a vendor and potential customer having crossed paths at a convention or trade show. Another key difference between an informally solicited proposal and a solicited proposal is there are no specific requirements for the vendor to satisfy in the written proposal. It is merely solicited by an expressed interest in the product or service that the vendor has to offer and an informal request for more information.

Karyn Maier
Karyn Maier

Contributing articles to WiseGEEK is just one of Karyn’s many professional endeavors. She is also a magazine writer and columnist, mainly for health-related publications, as well as the author of four books. Karyn lives in New York’s Catskill Mountain region and specializes in topics about green living and botanical medicine.

Learn more...
Karyn Maier
Karyn Maier

Contributing articles to WiseGEEK is just one of Karyn’s many professional endeavors. She is also a magazine writer and columnist, mainly for health-related publications, as well as the author of four books. Karyn lives in New York’s Catskill Mountain region and specializes in topics about green living and botanical medicine.

Learn more...

Discuss this Article

Post your comments
Login:
Forgot password?
Register:
    • Business proposals may contain figures and statistics represented by pie charts and graphs.
      By: Kzenon
      Business proposals may contain figures and statistics represented by pie charts and graphs.
    • A business proposal is written in response to a request for proposal.
      By: Igor Mojzes
      A business proposal is written in response to a request for proposal.