The Proposal

The Proposal - not as in Engagement but as in a Project Proposal. There are many ways to approach how your firm competes for business that is bid or requires a formal proposal.

if your product or service often competes for awarded work, there are a few ways to approach the opportunity. If it is a government contract or a project that is funded by a state grant, be prepared to respond to a more formal RFP (Request for Proposal) or the less paper onerous RFQ (Request for Qualifications). Often, these may require a stated percentage of both MBE and WBE contractors. Ensure that the ultimate quote you provide includes an acceptable profit margin. Often, these proposals can be very competitive and it is quite easy to lose control of your profit margin., especially if you are the Prime, responsible for hiring and managing other consultants. Do your research, know your competition, and truly assess if it is worth your time and effort to submit a proposal.

if you are directly negotiating a service contract, you can breathe a bit easier. Often a Letter of Proposal is all that is required. State what you are providing, timeframe of delivery, and price. Make sure to address what happens if the project goes beyond the terms of the contract. It is as simple as a statement after your Pricing Section that states anything beyond these terms will be negotiated at that time. Make sure your profit margin does not become eroded by adding extra hours wherein you are not paid. And that can easily happen!

If given the choice, we likely would always take the RFQ or direct negotiation path. But, if your firm chooses to participate in grant funded or government funded projects, you may not have this choice. So, if needed, meet with your accountant, understand your true costs on the project, and make sure your proposal covers those fixed costs and garners you a profit, it is the only way you will grow your business, other than acquisition.

October started the new fiscal year for most government entities, so it is a good time to review how you approach your fees. Never underestimate your worth, your value is not only your services, it is your brand, and your reputation. Wear it proudly and that means price it appropriately.

Be like our chocolate lab puppy featured today, know how to balance the what is necessary to achieve the optimum result for your proposals.

Be well.