Company Description/Overview
Products/Services Offered
Market Analysis
Marketing and Sales Strategies
Operations and Management
Financial Plan
Appendices
A business plan is a detailed document laying out how the business will function and develop in its first few years. The key is the “plan” part of the name, as it will specify how you will launch, gain customers, operate, make money, and, with any luck, expand.
Yet what many first-time business owners seem to forget is that a business plan is not a static document. The initial version is based largely on assumptions, supported by research. But as you run your business you’ll learn what works and what does not and make endless tweaks to your plan.
Thus, creating a business plan is not a one-time action – it’s a dynamic and continuous process of crafting and adapting your vision and strategy.
A business plan is generally much more detailed and broader than a business proposal, and has several elements :
A business proposal is created in connection to a specific business deal being offered by one party to another. As mentioned, when you take a business plan to an investor, you’re proposing a business relationship, so in this case a business plan and a business proposal are much the same.
But a business proposal could also be for others purposes, including:
A business proposal may offer specific terms for the potential relationship, or it may be just about the benefits the relationship will bring, with terms to be negotiated later. Essentially, it’s a sales tool to get people or companies to do business with you in some way.
Business proposals can be structured in various ways, but usually, they’ll include a summary of what your company can offer, a scope of the work to be done together, and sometimes, a price quote or a proposed structure of the business relationship.
Clearly, a business plan and a business proposal are similar – and can even be one and the same. At the same time, they can also serve very different purposes. Unlike a business plan, a business proposal can have a variety of aims and thus does not have a “one size fits all” structure.
Whichever one you need, be sure to take your time with the research and writing so your business has the best chance for success.
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“Ok, so you sell things.”
Well, honestly, I wasn’t surprised or peeved at the half-baked knowledge of my friend’s father when he made a snap judgment and conveniently labeled my marketing profession as sales.
After all, this wasn’t my first time when someone tagged me as a salesperson. So, I took a deep breath and explained to him how sales are different from marketing.
We, humans, dwell in a herd mentality and hone our word skills from our surroundings. Sometimes, we are simply careless, sometimes oblivious, but most of the time, we actually don’t know that the word has a different meaning.
This can be ignored in a casual conversation, but using the wrong words in a business space can change the implied meaning and lead to miscommunication. For example, cost vs. price , digitization vs. digitalization , warranty vs. guarantee , machine learning vs. artificial intelligence , etc.
“Don’t use words too big for the subject. Don’t say ‘infinitely’ when you mean ‘very’; otherwise you’ll have no word left when you want to talk about something really infinite.” – C. S. Lewis
This Process Street guest post untangles the confusion between two crucial terms – business plan and business proposal. These are used interchangeably in the business world, but their meaning and application are pretty different.
Words are the building blocks of communication. There is a French phrase for using the right word – le mot juste .
Let us strive for le mot juste !
Hop on and be a part of this fantabulous journey.
What is a business proposal, business plan vs. business proposal: what are the differences.
Here we go!
A business plan is a formal guide that acts as a blueprint, deciphering every root and branch to make a business successful. It is a written document that provides insights to internal and external stakeholders on business vision, goals, and strategies to achieve those goals.
“Without a plan, even the most brilliant business can get lost. You need to have goals, create milestones and have a strategy in place to set yourself up for success.” – Yogi Berra
A business plan, at its core, is an explanation of the below questions –
A business plan is not a bag of puffery statements. It is a document with factual information necessary for the survival of a business. You can create a business plan with the right tools or opt for a good business coach to get you started.
Let’s see what Tim Berry , business plan expert, founder and chairman of Palo Alto Softwar and bplans.com , has to say on business plans.
“What I love most about business plans is the business planning: like walking, it’s constant correction and review and revision. Planning, done right, is steering a business, managing growth, aiming the business towards the right future.” – Tim Berry , Small Business Trends
According to a study done by Palo Alto Software, those who create business plans double their chances to succeed in business .
Let us get down to brass tacks and understand why a business plan is super-duper important.
Record and present business information The primary intent of a business plan is to record and communicate information. It must document the business goals and the methods to attain those goals in a structured manner. It keeps businesses on track with their objectives.
A blueprint for seeking business investment ️ Whether you are a fledgling start-up or an established business seeking expansion or diversification, writing a winning business plan acts as a magnet to attract investors. It builds confidence and trust among investors about the lucrativeness of a business idea.
Lay down the right path ✔️ Not everything discussed verbally at an ideation stage transforms into reality in a pragmatic environment. Jotting down a business plan differentiates achievable from impracticable based on market dynamics, opportunities and threats, and company’s strengths and weaknesses. It sets the right track for business growth.
Establish short-term and long-term goals A business plan sets down short-term and long-term goals and the direction to accomplish them, right from baby steps to giant leaps. It becomes a basis to revisit the goals from time-to-time and make iterations depending on the present scenario.
“Any business plan won’t survive its first encounter with reality. The reality will always be different. It will never be the plan.” – Jeff Bezos, CEO of Amazon
Get clarity on your business A frequent question that pops-up in business discussions is: “Are we doing it right?”
A well-articulated business plan brings insightful knowledge on each aspect of a business – from what it has to offer to how to market the offerings.
Make informed decisions A business plan is a reality check to track what is being fruitful and what is causing hindrance. It paves the way to make a business sustainable.
Predict future financial performance Financial projection is the spotlight of a business plan. It’s the carrot that captivates the eyeballs and tickles investors to fund a new business.
A promising business plan talks about the company’s future financial performance – expenditure, profit, revenue, etc.
Explore new business opportunities A business plan is a flexible document that enables learning on the go. It bolsters research and infuses businesses with new and more feasible business opportunities. It gives organizations a fresh outlook and ushers them to be a howling success.
Now that we have answered the ‘what’ and ‘why’ of a business plan, let us move forward to solve the next riddle – how do you prepare it?
Identify your company’s vision, mission, and values Start by answering and figuring out your business personality:
This is your organization’s compass that acts as a foundation for the succeeding steps.
Know your target audience Dig deep into:
Learn market trends Identifying market trends keeps businesses ahead of the game. Analysis of industry data leads to business growth and profitability in the long run.
Weigh in the impact of unforeseen circumstances From financial turbulence to natural calamities and pandemics – a lot can go wrong in the future and leave a business shaking. Expect the unexpected and gird your loins for these testing times.
Creating a winning business plan increases the chances of success and spurs investors to fund your business.
According to a study published in Small Business Economics , entrepreneurs that create a plan are 152% more likely to start their business and appoint a registered agent and 129% more likely to push forward with their business beyond the initial start-up phase and grow it.
Here are the key components of an excellent business plan:
Executive summary First impression is the last impression!
An executive summary is a crucial part of this document. It provides the essence of the whole plan:
It should be informative and able to spark readers’ interest to know more about the business plan.
Overview of the business This section lists down information on:
…and all other related details.
Market analysis and strategies Put forth a strong case built on the solid rock of data analysis and statistics – present data on target market size, industry trends, sales forecasts, and marketing strategy.
Operating plan The operating plan highlights the operational requirements for the smooth functioning of a business. It includes facilities, supply chain management, inventory, manufacturing, shipment, logistics, staff management – everything under the sun that covers capital and expense (CapEx) requirements.
Growth plan This section answers the question: “Where do you see the business going in the next few years?” It provides visibility to investors on the milestones and how you will make money in near future.
Marketing plan Thee marketing plan section describes how to market the offerings to create and fulfill customers’ needs (who are the customers, product positioning, pricing policy, and promotional strategies?)
Management plan This section outlines how your organization is structured and basically how strong you are together. It describes the skills, background, and responsibilities of the management team. It builds conviction that the business is in good hands and has a proficient human capital.
Financial plan and projections This is the part where numbers become the king.
It draws up deets on inflow and outflow of money, sales forecast, profit and loss statement, balance sheet, cash flow statement, and budget expense. It discloses and forecasts the company’s financial goals, profitability model, and charts a course for the coming years.
Conclusion and appendix Conclude the business plan by succinctly bringing out the key pointers – the business’s vision, mission, goals, strengths, and growth trajectory. Make it compelling and to-the-point. Add relevant appendices to strengthen your business plan.
Pro tip: Use an all-inclusive ready-made business plan template document and Process Street ‘s business plan workflow to create unbeatable business plans.
Click here to access the Business Plan Checklist!
There are varying types of business plans depending on the purpose and usage:
A business proposal is the mantra that draws you closer to win a customer or bag a project.
Generally, it is a formal response to a Request for Proposal (RFP) sent by a prospective client looking for the right solution to their problems. It explains the particulars of a seller’s offerings and convinces the buyer that the proposed solution is the gateway to their business’s success and productivity.
“And, after all, winning business is what writing proposals is all about.” ― Tom Sant, Persuasive Business Proposals: Writing to Win More Customers, Clients, and Contracts
A business proposal comprises of four main points :
A business proposal is a testimony in itself that asserts, “I am the best you can get.”
Here are the reasons why you should and must make a business proposal :
The heart of preparedness is research and further research. After all, the devil is in the details.
Talk to prospective customers, visit their website(s), read published articles, and be a know-it-all for your prospective clients.
Sort out the ‘who’ First and foremost, dig every possible information about the client:
Understand the challenges Find what’s bothering them and what is causing hindrance to their business success. Learn about their existing solution and its challenges.
Stitch the glitch and offer the best solution After a thorough review of all the points mentioned above, find the best solution to your prospective client’s problems.
List down key differentiators This will help you to beat the competition in the dust. It draws a comparison chart and puts you in a superior position.
According to Gray Mackenzie, founder of GuavaBox ,
“Prior to submitting a proposal, make sure you have clearly defined all the major points verbally with the potential customer. By discussing the scope, cost, timeline, and details prior to submitting a written proposal, you can uncover objections earlier in the process.” – Gray Mackenzie, 10 Sales Experts Share Their Best Business Proposal Tips
Let’s get down to the fundamental elements that form a business proposal. Learn how to create a business proposal that stands out and close sales.
Title page/Cover page The name says it all.
Pretty easy-peasy thing to understand, right? After all, you have been creating the title pages since school days.
Still, make a note: Always write a gripping title that intrigues prospective clients’ interest and urges them to read on.
Other components that should be included on the title page are:
Table of contents (TOC) As the name suggests, a TOC is a well-structured layout of the document. It helps to skim and scan and navigate speedily through different sections of a business proposal.
Executive summary It sets the tone for a proposal and makes the reader inquisitive about reading subsequent sections. It sums up the entire business proposal – the purpose of sharing the proposal and why and how your solution is the right fit for the prospective client. Leave no stone unturned to boast about your offerings in the executive summary.
Details of offerings This is an in-depth description of the products or services your company has to offer.
How will the offerings solve the client’s problems? This explains why your products/services are the right fit to address a prospective client’s needs and why it is a better alternative than the competition.
The methodology/implementation of offerings This section is a blanket explanation of how the promised deliverables will be executed. It provides step-by-step clarity on each action along with timelines. It gives the client peace of mind and builds trust and confidence in the offering.
Pricing, payment, and legal matters Here, you talk about the pricing structure, applicable taxes, payment schedule, cancellation policy, and how you plan to solve the legal matters (if any arise in the future).
Here are some tips for this section:
Details about your company This is an exhaustive overview of your company. Don’t forget to add relevant customer testimonials, case studies, or success stories to build your case among prospective customers.
Signatures and Call to action This is the moment that gets butterflies in your stomach; the closure. This is the concluding part of a business proposal. Here (if all your prayers get answered), you and your client sign the proposal and secure the deal. Hurray!
Pro tip: Once you send the business proposal, don’t sit idle in your cocoon day-dreaming of winning the proposal. Always proactively do follow-ups with the prospective clients and clarify their doubts.
For start-ups or small businesses, drafting a business proposal can be an unnerving experience. They work fingers to the bone to write a perfect business proposal. Spending too much time on it might lead to missing the deadline and eventually losing out on a golden opportunity.
According to a report by Better Proposal , sending a business proposal within 24 hours increases the likelihood of winning the deal by 25%.
Here’s the secret sauce to speedily create flawless business proposals :
First, pick a professionally vetted and ready-to-use business proposal template and draft a business proposal like a cakewalk. Such as the Business Proposal Template included below.
Next, always use Process Street ‘s super-powered business proposal template checklist and ensure no step gets missed in the process.
It even turns out a blessing for big businesses since they have to draft multiple proposals all the time. Templates and checklists save a lot of time, enhance productivity, and increase the chances of success.
Majorly, there are two types of business proposals:
Solicited business proposal Also known as an invited business proposal, it comes into play when a buyer, or a company, outlines its requirements and requests suppliers to present an offer. It can be a response to a public tender issued by big corporations or government agencies.
Alternatively, a solicited business proposal can also be submitted as a response to the RFP shared by a prospective client.
The difference between the two is that while the earlier one is open to all bidders, the latter’s scope is limited as it is shared with shortlisted suppliers.
Pro tip: Do a thorough check before submitting an invited business proposal. Missing out on-minute details can kick you out from their consideration list.
Unsolicited business proposal An uninvited or unsolicited business proposal is a proactive attempt to create a business opportunity. This proposal is sent to prospective clients without being asked.
The good news is, there are slim chances of your rival sending a business proposal simultaneously, so less or no competition.
The bad news is, it might breathe in the customer’s inbox for a few days and then, without being read, depart to the heavenly abode -the trash folder.
But still, like a cold call, it leaves some impression on prospective clients and shoots up the chances to cut a deal in the long run.
Pro tip: An unsolicited business proposal is mostly sent through emails. Make certain to write an attention-grabbing headline and a convincing explanation to draw attention.
Here’s a comparison chart that distinguishes between business plan and business proposal:
Here are the secret ingredients to make awesome and captivating business plans and proposals:
This is not the right place to brag about your vocabulary skills. You want the prospective customer to focus on reading rather than wasting time looking up for a word.
Always remember! Communication is the key.
So, go simple and ditch those heavy jargons.
Don’t wear-out the pupils of your prospects with long-winded documents. Capitalize on the multisensorial abilities of humans as well.
Visuals increase people’s desire to read content by 80%.
Leverage the power of visuals and make your document easily graspable by adding graphs, infographics, flowcharts, tables, images, and videos.
Do not forget to add positive feedback or customer testimonials. If similar projects have been delivered in the past, do add relevant links and case studies of that work. It helps to build trust and strengthen your case.
“Make sure you have great success stories that you can share with potential clients. At the end of the day, most, if not all, potential clients want to know you will provide value to them and generate positive ROI.” – Mathew Bivens, Podcast and marketing consultant, 10 Sales Experts Share Their Best Business Proposal Tips
Ensure the document is free from grammar and spelling errors.
Your document should reflect your brand. Bring consistency in all your documents and design them as per the brand guidelines.
Time is money!
The likelihood of getting a ‘yes’ on your business plans and business proposals depends on how fast you can create a flawless document.
Empower your organization with a smart and all-in-one document builder tool like Revv – create, communicate, collaborate, and close your documents in no time.
Business plans and business proposals are two different worlds with distinct purposes and goals. But, both play a prime role in increasing the odds of business success.
People often get the wrong end of the stick and ask for a business plan when they mean business proposal or vice-versa.
But, we don’t need to worry about that since we are now clear on what is what.
Cheers to us!
P.S: Don’t forget to subscribe to the Process Street blog to get notified of our upcoming articles. We also have a podcast “Tech Out Loud” featuring content written by respected industry leaders such as Peep Laja , Sujan Patel , Tomasz Tunguz , and more!
What is your take on business plans and business proposals? Have you ever got your wires crossed with these two terminologies? Don’t forget to post your comments below.
Hey, I'm Molly, Junior Content Writer at Process Street with a First-Class Honors Degree in Development Studies & Spanish. I love writing so much that I also have my own blog where I write about everything that interests me; from traveling solo to mindful living. Check it out at mollystovold.com .
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Explore the distinguishing factors and circumstances that make a Business Plan or Business Proposal more fitting for driving success and growth in your enterprise. Gain insights into the purpose, audience, and strategic value of each document, and learn when it’s best to utilize a Business Plan or pitch with a Business Proposal.
Table of Contents
The main difference between a Business Plan and a Business Proposal is that a business plan is a formal document that outlines the company’s goals, strategies, market analysis, financial needs, and projections for the future, aimed at providing a roadmap for the business’s success and often used to secure funding or guide the management team. On the other hand, a business proposal is a tailored document created to pitch a specific product, service, or solution to a potential client or partner, detailing how the business can fulfill a particular need or solve a specific problem for the recipient, often with the goal of initiating a transaction or project.
A Business Plan is a comprehensive document that outlines a company’s objectives, strategies, market analysis, financial forecasts, and operational structures. It primarily serves as an internal roadmap for the company’s strategic direction and helps to attract investors by showcasing the company’s potential for growth and profit. Business plans are often developed during the foundational stages of a company and updated periodically to guide the company through different stages of growth.
A Business Proposal , on the other hand, is a targeted pitch provided to a specific client or partner to convince them to do business with you. Unlike a business plan, a business proposal is not a broad overview of the entire company. Instead, it is a customized suggestion that outlines how your business can solve a particular problem or meet a specific need of the prospective client. The proposal highlights the benefits of selecting your company’s products or services and typically includes pricing, terms, and conditions for a potential engagement or project.
A business plan should be reviewed and revised at least annually, or more frequently if there are significant changes in the market, the business model, or if new challenges or opportunities arise .
A business proposal may not be necessary when transactions are straightforward and do not require detailed explanations, such as standard retail sales or when there is already an established relationship with the client based on trust and familiarity.
Absolutely. If a proposal leads to a successful project and client satisfaction, it can serve as the foundation for a long-term business relationship and future projects or collaborations.
An unsolicited business proposal is one that is offered without an explicit request from the potential client. It often reflects the proposer’s initiative to identify potential needs of the recipient and offer solutions to unaddressed challenges.
To make a business proposal stand out, it should clearly articulate the unique value proposition, be tailored to the client’s specific needs, contain compelling and concise content, and demonstrate a deep understanding of the client’s industry and challenges.
Yes, a business proposal should ensure that all claims and statements are truthful and that no proprietary or confidential information is disclosed without permission. Additionally, the terms and conditions should be clearly outlined to avoid any misunderstandings, and if accepted, it can be the basis for a legally binding contract.
The decision between a Business Plan and a Business Proposal hinges on the specific requirements, goals, and context of your enterprise. A Business Plan lays the foundation for your company’s long-term strategy, risk mitigation, and operational guidance, with an expansive view of the business’s aims and the means to attract investors. Conversely, a Business Proposal concentrates on the immediacy of client-specific projects, presenting a tailored solution with a persuasive edge to secure contracts and foster client relationships swiftly.
Aspect | Business Plan | Business Proposal |
---|---|---|
A formal document outlining a company’s strategic direction, goals, and requirements. | A customized document designed to pitch a product or service to a potential client. | |
Used for strategic planning, securing investment, and internal guidance. | Aimed at winning a specific contract or project by addressing a client’s needs. | |
Potential investors, stakeholders, and company management. | Specific clients or partners with particular needs or requests. | |
Broad, covering all areas of the business including long-term goals and operations. | Specific to an offering that aligns with the client’s issue or challenge. | |
In-depth market analysis, financial projections, strategies, and organizational details. | Customized solutions, benefits, pricing, and terms for a prospective engagement. | |
Prepared infrequently, at startup or significant growth stages. | Generated as needed when seeking new business or responding to RFPs. | |
Standardized with sections like executive summary, market analysis, and financials. | Custom-tailored to the client’s request, often varying in structure. | |
Long-term outlook, often spanning multiple years. | Focused on a specific project or service timeframe. | |
Follows a consistent format for different uses. | Highly customized to the potential client’s requirements. | |
May seem inflexible due to its long-term and broad nature. | Adaptable and specific to client or project needs. | |
Provides a thorough business model and can attract investors with detailed planning. | Directly addresses a client’s needs and can initiate business quickly. | |
Can be time-consuming, costly, and may require frequent updating. | Lacks long-term strategic details and may depend excessively on the prospects. | |
When establishing a new business, seeking funding, and defining long-term strategy. | When targeting a client request, competitive bidding, and project-specific opportunities. | |
Both outline strategic approaches, require research, set clear objectives, are persuasive in nature, and include financial information and action plans. |
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What's the difference.
A business plan is a comprehensive document that outlines the goals, strategies, and financial projections of a business over a specific period of time. It serves as a roadmap for the business and is typically used internally to guide decision-making and operations. On the other hand, a business proposal is a document that is created to pitch a specific product or service to potential clients or investors. It outlines the benefits, costs, and potential outcomes of the proposed project in order to persuade the recipient to take action. While a business plan focuses on the overall strategy and operations of a business, a business proposal is more targeted and specific to a particular project or opportunity.
Attribute | Business Plan | Business Proposal |
---|---|---|
Purpose | Outlines the goals and strategies of a business | Proposes a specific project or service to a potential client or investor |
Audience | Internal stakeholders, investors, lenders | External clients, investors, partners |
Length | Can be comprehensive and detailed | Usually shorter and more focused |
Scope | Covers all aspects of the business | Focuses on a specific project or opportunity |
Implementation | Guides the execution of the business strategy | Outlines how the proposed project will be carried out |
Introduction.
When it comes to starting a new business or expanding an existing one, having a well-thought-out plan is essential. Two common documents used in the business world are the business plan and the business proposal. While they may sound similar, they serve different purposes and have distinct attributes that set them apart.
A business plan is a comprehensive document that outlines the goals, strategies, and financial projections of a business. It serves as a roadmap for the business and is typically used internally to guide decision-making and track progress. On the other hand, a business proposal is a document that is used to pitch a product or service to potential clients or investors. It outlines the benefits of the offering and explains why the recipient should choose to work with the business.
One of the key differences between a business plan and a business proposal is their scope. A business plan is typically a long-term document that covers all aspects of the business, including marketing, operations, and financials. It is meant to provide a comprehensive overview of the business and its goals. On the other hand, a business proposal is more focused and specific. It is tailored to a particular project or opportunity and is designed to persuade the recipient to take a specific action, such as investing in the business or purchasing a product.
Another difference between a business plan and a business proposal is their content. A business plan typically includes sections such as an executive summary, company description, market analysis, marketing strategy, operational plan, and financial projections. It is a detailed document that provides a thorough overview of the business and its operations. In contrast, a business proposal is more concise and focused. It usually includes sections such as an introduction, problem statement, proposed solution, benefits, and pricing. The goal of a business proposal is to persuade the recipient to take a specific action, such as signing a contract or making a purchase.
Business plans are typically used internally by business owners, managers, and stakeholders to guide decision-making and track progress. They are also used to secure funding from investors or lenders. A well-written business plan can help attract investors and convince them of the viability of the business. On the other hand, business proposals are used externally to pitch products or services to potential clients or investors. They are often used in sales and marketing efforts to generate new business opportunities. A well-crafted business proposal can help win new clients and grow the business.
In conclusion, while business plans and business proposals may sound similar, they serve different purposes and have distinct attributes that set them apart. A business plan is a comprehensive document that outlines the goals, strategies, and financial projections of a business, while a business proposal is a focused document that is used to pitch a product or service to potential clients or investors. Understanding the differences between the two documents is essential for any business owner looking to start or grow their business.
Comparisons may contain inaccurate information about people, places, or facts. Please report any issues.
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Business Plan Template
When you start a new business or own a young company, you often hear terms like business plan or business proposal. But the question is: do you need a business plan? Or is it a proposal that you need? Or both?
Being new to the game, these terms can seem quite intimidating, and you probably don’t know where to start.
Don’t worry. We’ve created a simple business plan vs. business proposal comparison so you can determine which one to prioritize.
Let’s start by defining them!
A business plan documents a company, its business objectives, and how it plans to achieve them. It includes data regarding business goals, marketing strategies, products, services, market research, financial projections, and the dream team.
Pretty much everything a company will use to achieve its intentions.
Okay! And what about the business proposal?
On the other hand, a business proposal is a document that describes your business’s offerings, like a product or service, to help you win potential clients and partners.
It also outlines your business, including its unique value proposition and how your company can help solve customers’ specific problems.
Now that we know the two business documents aren’t the same let’s see how they are different and in what ways.
Even though used interchangeably (and wrongly), a business plan and proposal are poles apart. Here’s how:
Before you ask why you need a business plan , it’s, first and foremost, to legitimize a business idea that you’ve been brewing in your head.
But it’s also to document company strategies, objectives, and operations that help you create a clear idea on how to achieve your company goals. All that data becomes one source of truth that works as a communication tool. That becomes your golden ticket to wooing investors and lenders.
On the other hand, a business proposal’s purpose is entirely about convincing a potential client and partner that your project is worth their time and money.
Unlike a business plan, it only focuses on a specific product, service, or opportunity instead of the entire business.
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When you write your business plan , it will typically follow a specific structure containing the following components:
Similarly, when you write a business proposal , you’ll typically encounter a structure as well. It goes like this:
A business plan’s target audience is internal stakeholders, investors, and lenders interested in your company’s long-term goals and path to success.
On the flip side, business proposals go to potential clients from established businesses. They target external or new clients, partners, or funding agencies with a specific focus on:
Do you know how many types of businesses exist today? Two words: Too many!
Now, that implies there are many different types of business plans . But here’s a quick list of the most common types:
Business proposal types can be broadly divided into two categories:
It’s already challenging to overcome market entry barriers in saturated markets and persuade potential investors. Creating a compelling business proposal and plan shouldn’t be too!
Here’s how to go about it:
It’s okay if you were confused about the difference between a business plan and a proposal before today. You now know the distinction between the two lies in their purpose, components, structure, audience, and type.
While a business plan provides a thorough overview of the entire business and targets internal stakeholders, investors, and lenders, a business proposal focuses on specific projects or opportunities and targets external clients, partners, or funding agencies.
When you understand these differences and employ the best practices in creating both documents, your business can effectively communicate its vision, strategy, and value proposition, securing a solid spot in this competitive world.
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What is the difference between a business plan and a business idea.
A business idea is a concept’s initial spark for a product, service, or opportunity. However, a business plan is a detailed document outlining how a business idea will be executed and managed.
A good proposal is 10-20 pages long. However, it can be longer based on the industry, buyer requirements, product or service type, the scale of buyer needs, and other aspects unique to the business.
The business plan comes first since it legitimizes a business idea. Then comes a proposal because it’s specific to a particular project or opportunity and not the business as a whole.
A business plan is a detailed roadmap for your entire venture. It helps you gain investments, beat competition, make sound decisions, communicate with stakeholders, and identify risks. So, yes, you need a business plan.
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It’s natural to get confused between a business proposal and a business plan if you are planning to turn your idea into reality. While business proposals and plans may sound similar on the surface, they have differences — such as distinct purposes and formats.
A business plan describes your business goals, strategies, and financial projections. A business proposal, on the other hand, proposes a specific solution to a problem or opportunity and helps you persuade the relevant stakeholder to invest in your business.
However, writing a business proposal or a business plan can be challenging, especially if you are confused about their purpose. In this blog, we will explain the difference between a business plan and a business proposal and its major components.
A business plan tells the investors how you plan to ship your product to enough people to clock revenue. It’s about the strategies that will make you the first buck.
A business plan keeps your team on the same page — you can use it as a guiding light. It can help you track the progress of your business, give you a roadmap, and help you make decisions about your business’s future.
Plus, it can be helpful when it comes to pitching your business idea to a third party, for example, when seeking a loan.
A business plan is majorly divided into three sections, which include an executive summary, a sales and marketing strategy, and a financial plan.
An executive summary is a brief, clear, and compelling overview of your business. It is usually the first section of the document, and it contains the most important information, such as your strengths.
These can be further broken down into the following sections:
A business proposal is a separate written document that outlines a specific business opportunity, project, or idea and presents it to potential clients.
It intends to persuade them to take action, such as accepting a business deal or entering into a partnership, thereby helping you get new customers or partners.
A business proposal should be customized to the needs and interests of the receiver. A generic proposal will rarely help you meet your business goals.
At the same time, ensure your proposal is well-organized, persuasive, and creative. Check out these free business proposal templates to impress your clients.
Proposals are solicited from you, or you send them on your initiative.
You write a solicited proposal in response to a prospect’s or customer’s request for a product. They may ask you verbally, or they may issue a written request for proposals (RFP). A solicited business proposal contains a detailed description of the product, service, or solution that you offer to solve the customer's problem or need. It’s generally easier to write because you know what the customer wants or expects.
But if you’re writing the proposal on your own, which is the case with unsolicited business proposals, then you’re convincing the receiver to work with you or buy from you. Such proposals are often challenging to write because you have to convince them they have a problem and you have a solution.
The following are the key components of a business proposal :
While a business plan outlines your goals and explains how you will achieve them, a proposal sells your product to potential customers.
In the following table, we have summarized the main differences between a business plan and a business proposal:
To wrap up, a business proposal is a document that pitches your products or services to a potential client, while a business plan outlines your goals, strategies, and financial projections for your business.
With business management software like Cone, you can easily streamline and automate your proposal creation while ensuring your proposals are bespoke and customized. Sign up for free and experience the seamless proposal creation process for yourself. While you’re at it, check out other business proposals and management resources we have for you.
One of the most searched queries on Google is "business proposal vs business plan", and we are here to break the confusion.
April 13, 2023
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You are starting a new business, and you aren't sure what you need to do. You heard that you needed a business proposal and a business plan, but you weren't sure what's the difference between them.
You did some research and couldn't find what you are looking for... You decided to create both of them, but you need weeks to write and refine them.
Don't worry, we are here to remove this confusing process. Let's see what's the difference between them. You may, and probably do need both of them. But which one should be your priority?
When you're starting a business, one of the most important things you'll need to do is create a business plan . This document will outline your company's goals and strategies for achieving them over the next five years.
A business proposal , on the other hand, is a sales document that you put together to pitch potential projects to clients. It's not the same as a business plan, and it usually includes cost quotes for potential projects.
The main difference between a business proposal and a business plan is that, while a business plan is informative, a business proposal is intended to showcase operations, goals, and potential.
The executive summary of a business plan will include information about the company leadership structure or the introduction of management. Generally, business plans include an executive summary part while business plans don't.
We have seen some samples that use executive summaries but since the main goal is to close a deal. We suggest keeping them short and clean.
The business proposal format depends on whether the business is solicited or unsolicited . Details of products and services offered, the scope of work and responses to specific questions in an RFP are included in a business proposal.
A business plan documents the vision of a business and how it will be achieved. A business proposal offers comprehensive information for potential investors, suppliers, accountants, etc.
A proposal shows the external player what the company is all about and how it intends to carry out its project. Keep these differences in mind when you're putting together your next business presentation --you'll need to tailor your content accordingly!
A business plan is a document that outlines the business goals, strategies, and tactics a company will use to achieve those goals. The business plan also includes an overview of the company, its management team, the target market, and the products and services the company plans to offer.
It usually includes information about the company's products and services, target market, marketing plans , financial forecasts, and management team bios.
Here's a sample template to use while creating a detailed business plan.
A business plan is a key document for any business. It lays out the goals and strategy of the business and helps to ensure that everyone involved in the business is on the same page. It can also be used as a tool to help secure funding from investors or banks.
A business plan is a document that outlines the strategy and goals of a company. It can be used as a planning tool , to track progress, or as a basis for making decisions . A well-written business plan provides a roadmap for the business , and it can help attract investors or partners.
There are many reasons to create a business plan. Some of the most common reasons include:
A business proposal is a written document that offers a solution to a problem or a way to achieve a goal. It is often used to sell products or services to a potential customer. A business proposal must be well-written, clear, and concise in order to convince the reader to take the desired action.
A business proposal is a formal response sent to an RFP (request for proposals). It is a way for the seller to convince the buyer that their proposed solution is the right one in order to win business. Business proposals are meant to persuade a prospective client.
A business proposal typically consists of four main points: what are the challenges, how your solution solves the problems, why they should choose you over others, and the best pricing options available. The price is typically stated in the document. If a business is requesting proposals, they should be sent in their format. An RFP response should include specific details about the scope of work and the cost estimate.
Here's a sample template to use while creating a detailed business proposal.
A business proposal is a key part of the business development process . It is a document that outlines the business goals, strategies, and tactics that will be used to achieve those goals. A proposal is used to convince potential clients or partners that your business is the best option for them.
It's typically used to pitch an idea to a potential client or customer. A well-crafted proposal can help you win new business and close deals.
Your company might be expanding into a new market and need to propose a new product or service. Or, you might be approached by another company with an opportunity you'd like to explore. Maybe you've identified a gap in the market and want to propose a new product or service to fill it.
Well, we do have a comprehensive guide to business proposal creation with templates and examples, but if you need a more brief explanation, keep reading!
When preparing for a business proposal, it is important to do your research and understand the client's needs. You should also have a clear understanding of your own company's capabilities and what you can offer the client. Additionally, it is important to be well-organized and to have a strong pitch.
You should have a clear understanding of your target audience and what will appeal to them. You also need to have a good grasp of the competition and what they are offering. In addition, you should be familiar with the terms and conditions of any potential contracts that may be involved.
Your proposal should be neatly formatted and easy to read. It should also be free of grammatical errors and typos. Be sure to proofread your work carefully before submitting it.
Make sure you provide complete contact information, as well as an outline of your proposed solution or service. If possible, include testimonials from past clients who have been satisfied with your work.
Remember that you are offering a valuable service that can help the reader achieve their goals. Believe in yourself and your ability to succeed, and you will be able to deliver a winning proposal every time
When writing a business proposal, make sure to follow this brief outline:
- Introduce yourself and your company
- Outline the proposal's purpose
- Explain the problem that you're trying to solve
- Describe your solution
- Explain the benefits of your solution
- List your qualifications
- Request a meeting
It should include an overview of the product or service, information about the company proposing it, financial projections, and terms and conditions. A well-crafted proposal can help your company win new contracts and increase sales.
Here's another sample template you can use while creating a business proposal:
Here's a story of our customer John who joined the Decktopus community 2 years ago.
John had been working in sales for years, but he had never worked in a company that sold products. When he was hired by a new startup, he was excited about starting making sales and increasing profits. However, he soon realized that there was no one in the company who knew how to sell. The founder of the company told him that he would need to create a presentation template to share with the other reps.
John wasn't sure where to start. He read article after article, trying to gather information about what made a good business proposal. After weeks of research, he finally created a template that he felt confident in sharing with his fellow reps. He was excited to see how it would help them increase sales and profits.
This is the outline we gathered while our support team helped him along the way:
-Executive Summary
-Problem/Opportunity Statement
-Business Plan
- Marketing Plan
-Financial Plan
An unsolicited proposal is one in which the company offers a product or service to a potential customer who has not solicited it. Here's an unsolicited proposal template .
A solicited proposal is one in which the company responds to a request for proposal (RFP) from a potential customer. Here's a solicited proposal template .
A proposal to bid is a document that a company submits to a potential customer in response to an RFP.
The purpose of the proposal to bid is to persuade the potential customer that the bidder's product or service is the best option among those being considered.
Here's a proposal to bid template .
A business plan has three main sections: the executive summary, a description of the business model, and financial projections.
The first section is an introduction that should be no more than one or two pages long. It should include a brief overview of your company, its products and services, and how you plan to make money.
The second section, a description of the business model, provides details about your company's competitive landscape, industry trends, and how you plan to reach your target market.
The marketing model is an informative section that should include detailed information about the industry competition and build-out plan. This part of the document can be several pages long and will help investors understand your company's place in the market.
While all three sections are important, remember that potential investors will likely focus on the financial projections most closely when deciding whether to invest in your company. The financial projections section is important because it shows potential investors how you expect your business to grow over time.
A well-crafted business plan can help convince potential investors to put their money into your company.
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Conducting a comparison between business proposal and business plan enables you to highlight the differences between the two. 3 min read updated on July 26, 2024
Updated November 12, 2020:
Conducting a comparison between a business proposal and a business plan enables you to highlight the differences between the two. Business plans are documents detailing how owners want to set up their business, their goals and objectives, and the processes and methods required to achieve these goals.
A business plan is a document that describes in detail how your business is set up, the vision of the company, and the methods and process for realizing business goals.
A comprehensive business plan should provide detail on your:
Although developing a business plan takes a lot of research, planning, and calculation, it is well worth it. Drafting a business plan is a good idea for existing businesses and startups alike.
The reflection and time spent while creating your business plan will clarify your business ideas, providing you with insights into aspects of your business that you may not have considered, and help you strategize.
A well-written business plan is a blueprint for success because it outlines all the steps required to move your business from the ideation stage to reality.
However, not all business plans are meant to be executed. You could discover during the research stage that your business idea isn't right for implementation. Realizing this earlier on means you can save yourself time and money that you would have invested in a dead-end idea.
Before trying to raise funds for a business loan through an angel investor, incubator, or venture capitalist, ensure that you have thoroughly researched your business plan. Developing a well-researched business plan should take approximately six weeks, so writing your plan a day before meeting with a potential investor won't cut it.
Your business plan should serve two purposes:
The following is a sample structure you can use to prepare your business plan:
Business proposals are documents proposing a business arrangement between you and another enterprise. The two main categories are:
When large corporations or the government want to purchase products or services from private suppliers, they usually post a public tender inviting contractors to submit a bid. The winning bid will be selected from those submitted by interested contractors.
Some organizations may also send RFPs (Request for Proposals) to select businesses that they are considering as potential suppliers. In this instance, you will compete against a handful of pre-selected contractors. Usually, the client provides a Bidding document stipulating the categories of information to be detailed as well as the style and type of proposal they expect from interested contractors.
If the Bidding document is not available, it is up to the contractors to decide what style of the proposal to present.
Companies that respond to a call for tender or an RFP are competing with other enterprises similar to theirs. As such, they must present themselves in the best possible light to win the bid.
Unlike invited proposals where the clients expect a bid for a product or service they need, an uninvited proposal is sent to solicit a business arrangement. You may have an idea for a product or service that will be beneficial to Company X and you have the ability to provide the service/product.
To indicate your interest in undertaking business dealings with Company X, you send an uninvited proposal stating your intentions to form a business relationship.
The company may or may not be open to your proposal; however, if it is interested, you don't have to worry about competing with other bidders.
To boost your chances of your non-invited proposal being accepted, you must market both your concept and your company. You must convince the prospective client of the value of the product or service as well as the stability and credibility of your company.
If you need help with a comparison between a business proposal and business plan, you can post your legal need on the UpCounsel marketplace. UpCounsel accepts only the top percent of lawyers on its site. Lawyers on UpCounsel come from prestigious law schools like Yale Law and Harvard Law and usually have 14 years of legal experience, including work on behalf of or with companies like Airbnb, Menlo Ventures, and Google.
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Business prop os al and business plan are relatively similar but distinctively different terms, making many use these two words interchangeably.
You’ll see distinguishing features in their content, structure, writing style, purpose, and goals. Even so, there are various similarities between a business proposal and a business plan.
The main distinguishing factor to note is that a business plan documents the growth strategy and presentation of facts, while a business proposal is a specific ask for an individual to take action (buy your service/product, partner with you in business, and invest in a particular business).
Let’s look at the two terms in detail and highlight a few examples when it’s appropriate to use.
A business proposal is a company’s documentation that goes directly to its prospective client. It’s usually written in an attempt to sell a company’s product or service.
While a business proposal is not an estimate, it’ll have certain financial details. An estimate is unofficial and simply a way to skim over the real costs without presenting the real picture.
In a nutshell, a business proposal shows a particular business idea intended to get investors to support this particular endeavor being suggested.
Although a business proposal shows an overview of what the company does (just like a business plan), its main aim is to provide information about the suggested business idea.
It answers any questions or concerns potential investors may have about the suggested business idea.
Prospero business proposal software can help you easily draft a competitive and compelling proposal to beat other bids. With its user-friendly interface and various proposal templates , you don’t have to create everything from scratch.
Let’s now look at the importance of a business proposal and a business plan.
The main reason a proposal is written can only be understood based on the type of proposal you want to draft. They’re two types of proposals; invited and non-invited proposals.
An invited proposal is submitted in response to an advertisement from a potential client. A good example is government agencies inviting contractors to bid on a particular service.
Alternatively, businesses request for proposals from a group of suppliers they’re willing to consider as prospective clients.
Non-invited proposals, on the other hand, are submitted to potential clients even when they haven’t requested one. In both instances, a company must develop a compelling proposal to convince buyers.
Proposals are limited in the scope of a particular need or project and written to specific audiences.
The main reason why businesses write proposals is to solicit or grow company opportunities. You can think of a proposal as an external document to present or sell the company to external players.
It shows what the business is all about and how it intends to carry out a particular project or use that opportunity to generate revenue for both parties.
A business plan is a factual description of a company on the operational and executive levels. It’s a written presentation of a company’s grand vision.
The document is typically tactical; it states where and when you want to start a project. Moreover, it will highlight when you’ll want to move on to the next phase of the project and how to accomplish that project.
It makes potential investors interested in a company (especially small startups that haven’t made a name for themselves).
A business plan will also provide an idea of what the business requires from professionals, such as attorneys and potential employees. It indicates whether or not a company’s business goals are realistic, let alone achievable.
Business plans are visions for your company and how you intend to execute all these visions. They outline financial projections of what a business will cost to develop and operate, plus an estimate of the revenues the business will generate.
Its main purpose is to provide a reasonably detailed description of the company for use by potential investors, suppliers, accountants, and prospective employees, among other people. For instance, one of the prerequisites for an SBA loan is an extensive and organized business plan.
Moreover, it’ll provide a quick but comprehensive view of what your company does and its chances for success.
The main reason companies write business plans is to convey and record information.
Here, the two documents have various components featured on them. Here’s a detailed description of their structure below:
Overall, the structure of a proposal will depend on whether it’s solicited or unsolicited.
A solicited proposal responding to a request for proposal takes the format of an RFP. Here are the components of a business proposal:
An unsolicited proposal to create a business opportunity follows the same format. It, however, anticipates questions potential clients might have .
A proposal is a marketing document designed to convince prospects to do business by presenting a value disposition plus a call to action.
Try creating your business proposal here .
A business plan has three components; sales tactics, business model description, and financial goals. More elaborately, it consists of the following section of information:
The business plan is more like an information document displaying the company’s operation and potential.
Many companies fail to follow this format while writing their business plan or proposal, a reason why most don’t win bids or prospective clients.
Using Prospero to write a professionally compelling business proposal and integrate your business plan can help you get investors interested in your company so that they want a sit at the table.
Business proposals differ from business plans in content, writing style, purpose, goals, and structure.
The sole distinguishing factor between the two terms is that a business plan is a factual presentation of facts, whereas a business proposal is an external market document that highlights a quote and a call to action.
Let’s look at some distinguishing features between the two terms:
A business plan provides a detailed description of how the business was set up, plus its project.
On the other hand, a business proposal is a purposeful sale document illustrating how a business will execute a particular project. Usually, it’s drawn and submitted to another enterprise or organization putting forward a business arrangement.
In addition, the structure of a business plan contains three elements, including a description of the business model , sales tactics, and financial projections.
On the other hand, the structure of a business proposal takes the format of an RFP if it’s solicited.
A business plan shows the scope of a business and, in turn, clarifies your thinking as a business owner and also gives you information that you hadn’t considered before.
Conversely, proposals show a limited scope of a specific project or need for a particular audience.
While trying to craft these two documents, you must seek proficient experts to help you write compelling proposals and plans to convince potential investors and other partners to invest in your business.
A business proposal can be divided into solicited and unsolicited proposals. How different are they? Let’s delve right in.
This is presented in response to a request for proposal (RFP) . It’s usually submitted responding to a work statement from sponsors.
These sponsors use the request for proposal to solicit a specific proposal for research, training, or to provide services or goods. The RFP includes standard terms, conditions, and assurance that the company is asked to accept.
A good example is when an organization or government agency wanting to buy products or services from a particular sector invites contractors to place bids.
In other scenarios, some businesses will ask suppliers to provide RFP to those they’re considering a partnership with.
The business is competing against other businesses that want to secure the same contract. It’s, therefore, in their best interest to provide compelling and competitive business proposals.
Prospero can assist you in such instances; it has the experience and expertise to curate excellent proposals that win contracts. Call it today to generate a proposal with its Prospero business proposal generator.
This proposal is submitted to potential clients, even when they haven’t asked for one.
In such circumstances, a business wanting to secure a contract will suggest a product or service to a potential organization in return for funds.
A good example is when an organization tends a proposal to develop an application or renders some training services to its staff.
Just like solicited business proposals, a company must curate a well-researched proposal that will convince prospective clients you’re the right candidate for the job.
Business plans are also categorized into four types, including
These types require different degrees of labor and are not always proportional to results.
Presentation Plan
Using PowerPoint to present information about a business has revolutionized the way companies create and showcase their business plans. Many business owners lose sleep trying to figure out how to present a plan that can significantly impact their company’s future.
Therefore, it’s crucial to understand the ins and outs of a business plan presentation in order to effectively communicate your ideas and strategies to potential investors or stakeholders.
This is a plan used to operate your business. The plan can be long in detail but shorter in presentation. There’s no room for informality or candor while preparing it.
If you’re considering presenting this plan to a loan committee, you’ll have to describe a competing rival primarily on a price basis.
A working plan used to create outlines for internal use may have some elements omitted; probably, you’ll not need to add an appendix with a resume of key executives.
Internal policy considerations may guide what to include or exclude in the working plan.
A business must prepare for unforeseen circumstances. The company may want to have a contingency plan when seeking bank financing.
This plan is usually curated in the worst-case scenario that you can foresee your business surviving. It’s important to shelter yourself from things like loss of market share, the defection of a key member of management, and heavy price competition.
A contingency plan can help cover the fears of bankers and investors by demonstrating that your business has considered more than one rosy circumstance.
Moreover, your business can benefit from a what-if plan in situation acquisition. It can help you outline the worth of the acquisition and how it can affect the core business.
In summary, you can say that a business plan is more of an internal document, whereas a business proposal is an external one that is used to sell the product or service of a company to prospective clients.
In addition, a business plan guides the activities of a company internally in terms of revenue projections and marketing strategies that must be achieved in a particular time frame.
On the other hand, a business proposal will show external parties like a government agency and sponsors what the business is all about to convince them to invest in your business. The proposal should outline how you will carry out a particular project to generate revenue.
Whether trying to curate a business plan or proposal, it has to be compelling and competitive to beat other bidders.
Working with Prospero to generate professionally written proposals or plans is essentially wise. It has a variety of templates for different industries and comes with a lot of customization options. Some ready-made content are also available so you won’t need to write from scratch every now and then.
You can manage and track the performance of your proposals through its built-in analytics, so your sales team would be more productive and efficient.
It’ll increase your chances of securing contracts and proposals that can take the business to the next level.
Sign up today and create your first proposal!
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A business plan and a business proposal are very different documents, with different purposes and goals. A business plan is a factual broad description of a company on the executive and operational level. A business proposal is a focused sales document intended to describe how a company will approach a project, state the value of the project to the client and solicit the client's business. A business plan is a written presentation of fact. A business proposal is a quote and call to action.
A business plan documents your vision for your business and how you intend to achieve that vision. It contains financial projections of what the business will cost to develop and operate plus an estimation of the revenues to be generated. Its purpose is to provide a reasonably detailed explanation of your business for use by potential investors, suppliers, prospective employees, accountants, attorneys and other people who need a quick but comprehensive understanding of what your company does and its potential for success. The primary reason for a business plan is to record and convey information.
Proposals may be unsolicited business ideas presented to a potential customer or partner, or they may be answers to requests for proposal submitted to your company by a potential client. They are limited in scope to a particular project or need. A business proposal also generally has a specific audience. The primary reason for a business proposal is to solicit or develop a business opportunity.
A business plan has three elements: description of the business model, the marketing model and financial projections. It consists of informative sections, including the executive summary, business description, marketing model, analysis of industry competition, build-out plan, operations plan, introduction of management, and a discussion of financial issues and projection of results. It is introduced by an executive summary, which can be a dense abstract or a longer marketing tool to attract interest in the business plan. The business plan is an informational document designed to factually display your company's operations and potential.
A business proposal written in response to a Request for Proposal (RFP) should follow the format requested in the RFP. Generally, this involves a quick description of your company's services and products that are relevant to the goals of the RFP, a reiteration of the scope of work, answers to specific questions posed in the RFP and a quote detailing materials, tools, labor, delivery and other elements of the cost of the project.
An unsolicited business proposal intended to create and develop a business opportunity follows essentially the same format but anticipates questions the potential client might have. A proposal is more of a marketing document, designed to convince the audience to do business by presenting a value proposition and a call to action.
Victoria Duff specializes in entrepreneurial subjects, drawing on her experience as an acclaimed start-up facilitator, venture catalyst and investor relations manager. Since 1995 she has written many articles for e-zines and was a regular columnist for "Digital Coast Reporter" and "Developments Magazine." She holds a Bachelor of Arts in public administration from the University of California at Berkeley.
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Understanding the distinction between a business plan vs a business proposal is vital for entrepreneurs and business owners. While both documents are fundamental to the lifecycle of a business, their purposes, structures, and target audiences differ significantly. This article clarifies these differences and outlines their unique components.
A business plan is a comprehensive document that outlines a business’s strategic direction and future plans. It serves as a roadmap, detailing the vision, operational strategies, and financial forecasts to guide internal management and attract investors. Conversely, a business proposal is a targeted pitch to secure a specific project or relationship. It focuses on convincing a particular client or partner of the business’s capability to solve a specific problem or to deliver a proposed project.
Business plan details.
A typical business plan includes several key components:
Learn how to create a professional business plan that sets your company up for success in our article “Business Plan: Write one like a pro” .
The structure of a business proposal often includes:
Business plan audience.
The primary audience for a business plan includes internal stakeholders, investors, and financial institutions. It aims to provide a detailed and factual representation of the business’s potential and strategic plans for growth.
Business proposals are directed at potential clients or partners. The focus is external, aiming to establish a contractual relationship based on the specific needs and problems of the recipient.
Types of business plans.
Determining whether a business plan or a business proposal should be created first depends largely on your immediate business needs. Generally, a business plan should be crafted first as it establishes a comprehensive foundation for your business’s structure, goals, and strategies. This document is crucial for internal clarity and securing initial funding, which is essential before reaching out to potential clients or partners.
Once your business plan is in place, you can focus on specific opportunities for growth and collaboration, which is where the business proposal comes into play. A business proposal is typically crafted in response to a specific opportunity, aiming to adapt the strategic insights from your business plan to meet the needs and solve the problems of a potential client or partner.
Having a robust business plan in place first guides your business’s strategic direction and strengthens your business proposals. It allows you to pull relevant information from a well-thought-out business plan to create tailored proposals that directly address the needs and challenges of prospective clients. This sequence ensures that your proposals are backed by a solid business strategy, enhancing credibility and the likelihood of securing contracts.
Creating effective business plans and proposals involves clarity, thorough market research, well-defined objectives, and a persuasive presentation. Both documents should be visually appealing and align with the professional tone of the business. Utilizing tools like Modeliks can significantly streamline the process, offering templates and interactive elements to enhance the professionalism and effectiveness of your documents.
Modeliks provides cutting-edge tools that assist in crafting detailed documents. With features designed to simplify the creation process, enhance the layout, and present data interactively, M odeliks helps businesses present their cases persuasively.
Ready to take your business to the next level? Start with Modeliks today. Enhance the quality of your business plans and proposals with our robust suite of tools designed to deliver precision and professionalism. Sign up for Modeliks and revolutionize how you present your business strategies.
July 29, 2024
July 22, 2024
Whether you are in business, employment, or college pursuing a degree, understanding the basics of a business proposal is a skill that you must have. Most people use the terms business plan and business proposal interchangeably. These two documents are very different. A business plan is different from a business proposal in terms of content, structure, writing style, goals, and purpose. The most important difference to note is that a business plan is a written presentation of fact while a business proposal is a price quote and a call to action.
According to an article on Entrepreneur.com , a business plan is a document that outlines a detailed description of how a business is set up. It is a 5-year plan of a business showing the company structure, products and services, market findings from research, marketing strategy, planned budget and financial projections. It can be simply defined as the factual and wide description of a business and its projections. A business plan can be drawn by a start-up as well as a going concern.
A business proposal is a purposeful sales document formulated to illustrate how a business will carry out a project, give the value of the project to the prospective client and ask for the client's business. Therefore, it is a document that a business submits to another enterprise or organization putting forward a business arrangement.
A business plan ideally comprises three elements: description of the business model, the marketing strategy and financial projections. It includes informative sections, specifically the executive summary, business description (products and services), marketing plan, industry analysis (competitor analysis), build-out plan, internal analysis, operations plan, leadership structure or introduction of management, and financial projections -- discussion of financial concern and projection of results. The opening page is the executive summary. It can be an intense abstract or a detailed but precise marketing tool to draw interest in the plan. The business plan is an informational document intended to factually showcase the company's operations, goals and potential.
According to Sean Kerner from Tech Republic, the format of a business proposal depends on whether it solicited or unsolicited. A solicited proposal and in response to an RFP should take the format called for in the RFP. Usually, this entails a quick description of the services and products offered by your business and clearly showing their relevance to the goals of the RFP, a replication of the scope of work, response to specific questions raised in the RFP and a quotation detailing materials, equipment, labor, delivery and other basics of the project outlay. An unsolicited business proposal may or may not take the same format. The intention is to create and develop a business opportunity, and so it is advisable to follow the same format or any other that is popular with the industry or business. Be keen to address all the questions that the potential client might have. With an unsolicited proposal, it is up to you to decide the structure. Whichever format you choose, ensure that the proposal is professional, highlights key areas of interest, presents a value proposition, is thoroughly researched and loaded with facts and with a call to action.
A business plan is required for two main reasons. It clearly defines the scope of the business and in the process clarifies your thinking as the proprietor of the business. It offers you information that had not been considered previously. Simply put, it documents the vision of the business and how it will be achieved. This guides the business towards a practical strategy to guide the business for the time-frame enclosed by the plan. It is the blueprint to success of the business. It outlines strategies for converting the ideas into core competencies. It also presents the financial projections of starting and operating the business as well as estimation of revenue generation from business activities. Secondly, it offers comprehensive business information for use by potential investors and employees, suppliers, accountants, attorneys and other stakeholders. The primary function for a business plan is to record and pass on information.
A business plan is also used to raise funds in form of a business loan, venture capitalist, angel investors or incubation. When approaching these money lenders you must present a thoroughly researched and realistic business plan. The investors need to be sure that you are confident and truthful about the market statistics and financial projections indicated in the report. A business plan should be as truthful as possible because it is the blueprint and vision of the company. It provides a checklist of whether the objectives of the business are on track. According to experts, a professional business plan requires about six weeks of in-depth research and preparation. It is not possible to whip one a day before your appointment with investors.
The reason for a business proposal can be well explained based on the type of the proposal. There are two major types of business proposals: invited and non-invited. An invited proposal is submitted in response to an advertisement from the buyer or client. For instance, organization and government agencies wanting to purchases services and products from private suppliers invite contractors to place their bids. Alternatively, some businesses ask for Request for Proposals (RFP) from a selection of suppliers that they willing to consider as a prospective partner. In each case, the business is competing against other bidders. It is in the interest of your business to present a competitive and compelling business proposal.
Non-invited or unsolicited proposals are submitted to potential clients even when they have not requested for one. In this scenario, you give suggestions to the company or organization to purchase services or products in return for funds. For instance, you can tender a proposal to develop an app for an organization or training services for its staff. The most important thing in both cases is to come up with well researched offer to convince buyers. A business proposal is limited to the scope of the specific project or need. In addition, it has a specific audience. The primary function for a proposal is to solicit or grow a business opportunity.
You can look a business plan as more of an internal document. A proposal on the other hand is an external document used for presenting or selling the business to an external player. A business plan guides the activities of the business internally in terms of marketing strategies and revenue projections that should be achieved. A proposal shows the external players such as governments, donors or business partners what the business is all about and how it intends to carry out a project at hand or use the opportunity to generate revue for both partners.
For more information, here is an article on how to write a business proposal .
Entrepreneur.com: An Introduction to Business Plans https://www.entrepreneur.com/article/38290
If you want your business proposals, price quotes, and contracts to stand out above your competitors and give you the best chance at winning new clients, use ClientPoint's Proposal Software . It makes creating and formatting professional business proposals, price quotes, and contracts fast and easy.
Proposal writing tips, a business proposal checklist to help you win more clients, 8 reasons why paper-based business proposals are dead and digital business proposals are superior, what is a business proposal and how to write it for b2b sales.
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Learn how to write a business proposal that’ll stand out from the crowd and increase your chances of success.
A business proposal is a formal document you send to a prospective client in the hopes of winning a project or making a sale. In your proposal, you outline the service you’ll offer and explain why they should choose you.
There are two types of business proposals:
A business plan is the roadmap for a business and shows the overall strategy, goals and vision for success. It shows how a business operates and how it will make money. You can create a business plan using our free template .
A business proposal is a pitch to sell a product or service to a prospective customer. The proposal aims to make the sale and shows the potential of the product or service to solve a problem.
An effective business proposal should solve the three Ps:
A business proposal has a clear format and should ideally include each of the following sections.
1. Title page
This sets the tone and must look professional. You should include your name, your business’s name, the name of the person you’ll submit your proposal to, the date submitted and the title of your proposal.
2. Table of contents
The table of contents allows your potential client to see what’s in your proposal and also lets them skim to find the information they consider important.
3. Executive summary
This is similar to the executive summary in your business plan. Explain why your business meets the client’s needs and why you are better than your competitors. It should:
4. The problem statement
Outline the main problem your potential client is wanting to solve. This shows them that you understand their pain points. Use data to back up your argument and be specific.
5. Proposed solution
Here’s where you explain in detail your proposed solution and how it’ll solve the client’s problem. Your solution should be specific and personalized. You should include details of what you plan to provide and the benefits of your proposed solution. If you’re pitching for a specific project, share the proposed timeline, and explain how you’ll measure the success of the proposed solution. Visual charts and graphs can help illustrate your points.
6. Qualifications
Use this section to build trust. Explain why your business is the best one for the job and why they should choose you. You can include case studies of previous clients, client testimonials, social media endorsements or praise, relevant industry-specific qualifications, and certifications and years of experience.
7. The timeline
If you’re pitching for a specific project, outline a clear and realistic timeframe of how and when you’ll complete each part of it. Present this in a flowchart or a road map with deadlines and step-by-step actions. If your proposal isn’t for a specific project, give an idea of general timeframes your business works to, for example manufacturing or shipping times, or turn-around times for services.
8. Pricing, billing and legal
This is one of the most important sections. How you structure it will depend on the size of your project and the type of proposal.
For smaller projects and unsolicited proposals, a summary of the fees, or potential fees is sufficient. For a larger project, provide a breakdown of costs to show your potential clients what they’ll be paying for. You can also provide options to allow clients room to move. Check back on the client’s RFP terms if it's a solicited proposal to make sure you meet their requirements.
If there are any permits or licenses required for the project these should be added to this section.
9. Terms and conditions
Clarify the terms and conditions and summarize details for the project, including timeline, pricing and payment schedules. This is where you include items such as cancellation policies, deposits, warranties and shipping. Get your terms and conditions checked by a lawyer before you send them to prospective clients.
10. The acceptance
The final step is to leave a space for signatures. Include a signature box for your client to sign when they accept your proposal. Make sure you include contact information if your client needs to follow up with any unanswered questions.
There’s a lot to keep in mind when you’re writing your winning business proposal. The following features can help make your proposal stand out from your competitors.
Before you begin writing your proposal, plan out everything in an outline. Ensure you have all of the key information you need and research any you don’t have.
To impress your client and set you apart from competitors, use hard data that demonstrates the value of your proposal. Highlight your data in flowcharts, graphs or a table to enhance their presentation.
Include visual images to break up and enhance the text of longer proposals. Examples of visuals that are great for business proposals include infographics, flowcharts, timelines, photographs, organizational charts and comparison tables. Make sure they’re relevant and not just decorative. Include captions or explanatory notes with them if it’s not obvious what they’re about.
If your proposal is online or a PDF, a short video can help to strengthen your proposal and increase engagement with the prospective client. Types of videos that work include:
Use social proof to add credibility and trust to your proposal. It may help convince your client to accept your proposal if they can see positive reviews or case studies from previous clients. Types of social proof include case studies, testimonials, reviews and rankings, customer stories and previous clients you have worked with. Make sure you have approval to share this information though – you don’t want to breach the privacy of customers or previous clients.
Include a call to action so that your audience knows what action they should take after reading your proposal. Ensure you include contact details so they can ask questions or clarify any issues they have.
Consider your client’s budget, if you know it, and provide several pricing options (high, mid, low) with extra provided for the higher price. Use a pricing table to present your options.
Include other services or related products your business provides. It’s an opportunity to add on extras to the basic proposal, and gives the client additional information about your business.
Allow your brand’s personality to stand out. Demonstrate how you are better and different from your competitors.
Avoid using business jargon and keep your sentences short and simple. There’s no ideal length for a business proposal, but it is important to be succinct and clear. Your proposal should provide enough in-depth information to persuade the decision-maker without overwhelming them.
Be thorough and proofread your proposal. Check your spelling and grammar are accurate and there are no typos. Pay attention to the details and make sure your numbers and all information in your proposal are accurate.
Once completed, write a one-page cover letter to send with your proposal and convince the decision maker to read the entire proposal. Your cover letter should include:
Xero does not provide accounting, tax, business or legal advice. This guide has been provided for information purposes only. You should consult your own professional advisors for advice directly relating to your business or before taking action in relation to any of the content provided.
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Tore Medhaug
In order to send an official business proposal, you have to have a business plan. These are two different document types that people often confuse and mix.
Let’s take a look at the difference between the two, starting with the document you should have in place before submitting an official business proposal.
A business plan is a document that describes what your organization looks like and what services and deliveries you would provide.
As a student at BI Norwegian Business School , I learned that a business plan should include the following three elements:
A business plan is a document you would not typically send to your client but to lawyers, insurance providers, banks, suppliers and other stakeholders that would find this relevant for understanding your business and its value.
A business proposal describes what you can deliver, time frame, amount, cost and your terms and conditions. This is a document you would use to respond to a specific request from your client, or you would send it to your client or prospect describing what you can deliver, at what price.
When you respond to a specific request, also known as an RFP (request for proposal), you should follow this rule of thumb:
There are many different ways to write a business proposal, and many different solutions to write it with. For the best possible outcome in terms of control, cost-efficiency, time savings and security, use an enterprise-grade co-authoring and automation tool.
The proposal solution XaitPorter is used by companies all over the world for this purpose. Here are six key advantages of using XaitPorter to create your business proposals and other high-impact, high-value documents:
Tore holds a Technical degree and has a variety of business courses from BI Norwegian Business School. He has previously worked for different oil service companies and IT companies. Tore used to be Norway's biggest self-proclaimed golf talent, and also has a big passion for Ice hockey.
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When it comes to your business, getting sales and new clients are your lifeblood. That’s why it’s crucial to master writing and designing a professional business project proposal. And it helps to know the different types of proposal you may need to create.
A business proposal that's well-written and has a polished design can mean the difference between winning or losing potential clients. But what is a business proposal exactly? What should it include and how do you make sure your business proposal is effective?
In this post, we’ll answer these questions. We'll also share what you need to know about most effective business types of proposals. Plus, we'll explain how to write and design a standout proposal that helps you close more sales.
Businesses use business project proposals to convince others to buy their products and services. A business project proposal will identify the buyer’s pain points and present the right solution for those pain points. Different types of business proposals achieve different goals, as you'll see later on.
The purpose of the proposal is to inform potential buyers about your goods and services and to serve as a sales pitch that helps close the sale. Business proposals streamline the selling process and outline exactly what the project will entail, eliminating the scope creep later.
For a quick guide on how to write a business project proposal, study this tutorial:
If you and your prospective client are keen to work together, you may be tempted to skip the business project proposal. But that can be a big mistake. Having a written project proposal has several advantages. These include:
“You have to put forth the necessary efforts and resources to know client values, what you can deliver, and weaknesses of competitors, to develop a compelling blueprint or win strategy.”
Writing and designing a business project proposal isn't easy. But the good news is that you don’t have to start completely from scratch. There are many business proposal templates available online.
Professionally designed templates will save you time because they already have everything in place. All you've got to do is drop in your content. Each template also serves as a project proposal example that can guide you in writing a project proposal.
One of the best places to find great business project proposals is Envato Elements. It's a subscription-based marketplace with thousands of modern and professional business project proposal templates .
Download as many business project proposal templates as you want: all for a low-monthly fee. Besides business proposal templates, Envato Elements has thousands of other unlimited-use design assets such as:
Another place where you can find even more great business project proposal templates is GraphicRiver.
This marketplace is part of Envato Market, a suite of marketplaces catering to various creative needs. On GraphicRiver , buy individual business project proposal templates on an as needed basis.
We’ve just covered what business project proposals are and how you can save time with professional business proposal templates. Now let’s talk about what are the different types of business proposals. By knowing the difference between types of business proposals, you’ll know exactly which proposal to send to each client.
There are six different types of business project proposals:
Let’s go over each of these below:
Use this type of proposal when you're responding to an official request for proposal. In most cases, this will be the easiest type of proposal to write as the potential client or customer will specify what they're looking for. In some cases, they'll even outline what they want the proposal to cover.
This type of proposal is the same as the formally solicited proposal, but with one difference. The information in the proposal isn’t clearly specified in an official document or request.
Typically, you’ll write this proposal when a client or customer is interested in what you've got to offer and asks for a proposal. Since the client doesn’t specify their needs, you’ll have to do more research on your part to analyze the client and understand what they're looking for.
The unsolicited proposal like a cold call. You could send an unsolicited proposal if you stumbled upon a potential client and think that your offer is exactly what they need. This is one of the hardest proposal types to write. You’ll have to do plenty of research upfront and be very convincing in how you present your project proposal ideas.
Send a continuation proposal when you want to send a reminder or an update about an ongoing project that’s already been approved. All you’re doing with this proposal is providing an update on the project and asking for approval to carry on with the project. These proposal types are the easiest to write unless the client wants major changes moving forward.
Use the renewal proposal after you’ve completed a project and want to make a case for continued support. When it comes to renewal proposals remember to provide convincing proof why it’s beneficial to continue with the project.
Lastly, the supplemental project proposal is reserved for when you need approval for extra resources for the project. Provide reasons and justify why those resources are needed and create an updated estimate of what the project will take to complete.
No matter what type of proposal you’re writing, there are common sections that should be included in every business project proposal. These include:
Your proposal should also make it clear to the potential client why you’re the perfect fit for the project by including this information:
By now, you know the different types of business project proposals and what each proposal should include. Let’s tackle some writing and design tips that'll help you write a winning proposal in 2021 so you can confidently close more sales:
The first step in writing and designing your business project proposal is to make a plan. The plan should include researching your client and their business.
Research helps you understand the problems, the budget, the preferred timelines, and specific industry requirements. This ensures that your proposal will present them with the best possible solution. The tips in this article can help:
After you’ve familiarized yourself with the client and their problems, create an outline for your proposal. Make a note of all the sections you want to include and the points you want to cover.
Learn more about proposals for freelancers and other creatives tutorial:
Once you've got a plan for your proposal, you need to clearly state the problem. This section has to make it obvious to the client what their pain points are and why they need to act on the problem. It should convince them to take action by relating the problem back to them, using their own words and concepts they can easily understand.
Now that your audience is aware of their problem and they know what happens if they don’t act, it’s time to present them with a solution. You’ll want to back this up with evidence and data. Show the benefits of the solution along with the steps necessary for the successful implementation of the solution. This will make it clear what they can expect throughout the entire project.
Your potential clients will also be interested in how long the project will take as well as how much it’s going to cost them. Include a section that gives accurate estimates of time, materials, expenses, and other resources needed.
Here's a tutorial to help you figure out what to charge:
When you’re done writing out all the necessary sections of your proposal, conclude with a section that outlines next steps. This can include asking them to get in touch with you via phone or email, booking an appointment, sending over a signed proposal or similar.
Be clear and concise here. As we mentioned earlier, include your contact information in case they've got any questions.
When it comes to the design of your proposal, include plenty of visuals. Photos, charts, graphs, icons, and infographics can help potential clients visualize how the project will go. It'll also make it easier for them to understand more abstract or complex concepts of the proposal.
Your proposal cover is the first thing potential clients will see. Make it more engaging by including a photo that relates to their project or a photo of your company.
You can also include your logo. Use a bold font for the title to instantly capture their attention.
Your proposal will include both text and visual elements. Make sure they're properly aligned with the help of guides in your document.
Proper alignment will make the entire proposal more visually appealing by adding hierarchy to your design. Your project proposal format is important. Formatting issues like proper alignment make a difference.
Save time on writing and designing your business project proposal by using professionally designed business proposal templates. These templates will not only have all the necessary sections, but they'll also have the basic layout and design elements. All you’ll have to do is add your content and then customize the template with your choice of colors and fonts.
If you're creating your proposal in MS Word, consider these templates:
Our last tip is to proofread the entire proposal several times to ensure there are no grammar or spelling mistakes. Make sure that all the information is accurate and up to date, especially if you’re talking about your company history or about your client’s business.
Business proposals are constantly evolving. I've collected some of the top tips from experts who have either prepared many business proposals, or who review proposals as part of their role. Keep these tips in mind to increase your chances of winning that deal or grant.
A common mistake is to make the proposal all about you. Carl Dickson, founder of PropLIBRARY , a huge web-based resource full of practical advice for how to write winning proposals, shares this advice:
“The biggest mistake people make is writing what they want to say instead of what the customer needs to hear in order to make their decision. They treat it like a brochure sent to unknown readers instead of a specific organization with known requirements. Instead, write from the prospective client’s perspective. Spend more time thinking about, researching, and discovering what matters to the customer than you do writing. Then make your case as to why what you are proposing is their best alternative for achieving their goals.”
When you write from the prospect’s perspective, you'll find yourself customizing the proposal to them. People tend to rely too much on templates for content, and that can be another big mistake because it makes your proposal generic. If you begin with a template, it should be tailored to each client so that they feel like their needs and circumstances are being addressed.
Kristin Marquet, owner of a PR and branding firm in New York, has drafted more than 500 business proposals for clients since 2009. Her advice:
“My top tip is to provide a scope of work that is customized for the prospective client. A proposal should outline the project objectives, strategies, tactics, timeline, and budget while being specific to the client. I've seen other agencies use a one-size-fits-all approach when preparing their proposals, and that doesn't work as well as a tailored proposal.”
A practical tip is to include a table of contents. After more than 30 years of experience reviewing proposals for investment properties, real estate marketer Dave Kohl has observed that different prospects are interested in different parts of a proposal.
Even within the same company, if several people will be reviewing the proposal, each one will be reviewing different parts of the proposal. A table of contents helps each one find the section that’s most relevant to them.
“Include a table of contents. This will allow people to get to the information that’s most important to them quickly. Some companies consider the financials to be more important than the execution, while some do not.”
Keep your proposals fresh by constantly reviewing, editing, and revising them. This is especially true if you produce a large volume of proposals and use templates.
Michael Alexis is the CEO of TeamBuilding , a company that sent out thousands of B2B proposals in 2020 and won over 15,000 contracts. Alexis says:
“These proposal templates can quickly become legacy-documents within a business. They aren’t up-to-date or exactly what your current client needs. I recommend giving every proposal, or proposal over a certain value, a quick read over. A clear and accurate proposal will help you win deals.”
Alexis observed that the most common opportunities for updating a proposal template include:
Don’t just send off your proposal and then cross your fingers and wait. Follow up with the prospective client in a way that shows you can deliver on what they’re looking for.
Jenn Morgan is a brand marketing consultant and founder of Radically Distinct , a strategic brand marketing agency. As such, Morgan writes about six proposals per month and has revamped hundreds of proposals for clients. Her top advice?
“The proposal is only one piece of the customer acquisition process. Don't rely on the proposal alone to win the deal. Go the extra mile and showcase case studies, follow up with happy customers, and make sure you hit every point of your unique value proposition.”
Winning proposals is critical to getting the income or funding you want. Strengthening your proposal writing skills will pay off for the lifetime of your business or organization. As with most things, practice makes perfect. It also helps to track your results and analyze what makes some of your proposals succeed while others fail.
These articles are a good place to begin:
Writing and designing an effective business project proposal might seem daunting. But once you know what you need to include and which proposal type to start with, you’ll have a much easier time.
Get a head start on your business project proposal with one of our professionally designed business proposal templates from Envato Elements if you need proposal templates and other creative assets regularly.
Or, if you need a single business proposal template, choose one from thousands of modern business proposal templates from GraphicRiver.
Note: This article was originally published in July of 2020. It's been updated with help from Lexi Rodrigo .
A business plan and a business proposal are two distinct documents. Most people mistake them for each other, and a lot of articles on the internet that teach how to write a business proposal are actually just explaining how to write a business plan.
While a business plan focuses on a company’s goals, the problems and solutions it’s trying to address, its potential market size, keys to success, products and services, market execution, and more, a business proposal on the other hand usually focuses on how a certain project would be executed, states a quote for the project, terms & conditions, and several other key pointers.
These two documents are very different with each serving distinct purposes. So it is important you know whether what you need is a business plan or a business proposal at any time.
See Also: 10 Reasons To Write A Business Plan
A business plan envisions your pipe dream. It shows how your business goals, objectives, philosophies, industry analysis, target market, products & services, market execution, competitive analysis, financial projections, and a whole lot more will position the business for success.
It is a detailed document that investors, banks, accountants, and financially savvy individuals can easily review to know what your business is about, its chances of success, and how you’ve planned to scale.
In preparing a business plan, here is a sample structure you should follow to get it done right:
See Also: How To Write A Business Plan: The Complete Guide
Business proposals are usually solicited or unsolicited. A solicited business proposal is written upon request from an organization, institution, or individual. For example, if you receive a Request For Proposal (RFP), what you’re preparing would be a solicited business proposal. In this instance, you’d have to follow the requirements as stated in the RFP.
An unsolicited business proposal, on the other hand, is prepared in response to a client after a sales meeting, giving you more flexibility in curating the contents of the proposal.
Business proposals are limited in scope, and are thus, written for a specific audience.
Here’s a sample business proposal structure:
In your business proposal, you will detail the scope of the work, materials needed, cost estimates, project timeline, previous clients, team members, achievements, and a whole lot more in the body of the proposal. It’s a marketing tool, and its goal is to convince the target customer to do business with you.
See Also: How To Write A Winning Business Proposal: The Complete Guide
The variations between a business plan and business proposal are wide apart. As shown in this article, they serve different audiences and are prepared for different reasons.
If your goal is to seek investment or a bank loan, a bank and investor ready business plan is what you need. But if your goals are to convince a client to use your service whether the client has asked for a document showing how much value you’d add to them or not, a business proposal is what you need.
See Also: How To Write A Feasibility Study Report: The Complete Guide
Image Source: businessnewsdaily.com
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thanks for these information it is really gearing forward toward my goal.
I’m glad you find it valuable, Yusuf.
Do have a great time!
Thanks Edom, I have been reading your publication, they have inspiring, informative, education and above all priceless. keep up the good work.
samuel Chika
Thank you for the kind words and for being a reader, Chika.
I appreciate them.
Great read.I have always confused the two terms.Business plan means you plan for a business and that business has not yet started but business proposal it means you propose something in a business which is ready stand.Thanks for the detailed information.
You’re right Michael.
I’m glad you learned something from the article.
in my understanding, business plan is general road map for the company strategy, but business proposal is one away to find new market or potential client.
I was searching difference between B.Proposal and B.Plan. I found here, Thanks for the publication. IF you also publish “Samples” besides the templates will be more helpful to a person like me, who did not write proposal before.
My Best Regards
Thank you for reading and for the suggestion.
Hello Stan E.,
This is absolutely spot on. No unnecessary embellishments or needless journey. Straight to the point, self-explanatory and informative.
Thanks a million, Sir.
Thank you for reading, Figo.
Not many people really know the differences. They used both interchangeably. Thanks for the clarity.
Thanks Edom, your publication was most helpful to me. I am grateful sir, continue with the good work.
Comments are closed.
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A business plan and a business proposal are very different documents. If you do an Internet search for how to write a business proposal, the results are predominantly focused on writing a business plan. Nevertheless, the two documents have different purposes and goals. A business plan is a factual broad description of a company and its prospects. A business proposal is a focused sales document intended to describe how a company will approach a project, state the value of the project to the client, and solicit the client's business. A business plan is a written presentation of facts. A business proposal is a quote and call to action.
A business plan documents your vision for your business and how you intend to achieve that vision. It contains financial projections of what the business will cost to develop and operate plus an estimation of the revenues to be generated. Its purpose is to provide a reasonably detailed explanation of your business for use by potential investors, suppliers, prospective employees, accountants, attorneys, and other people who need a quick but comprehensive understanding of what your company does and its potential for success. The primary reason for a business plan is to record and convey information.
Proposals may be unsolicited business ideas presented to a potential customer or partner, or they may be answers to requests for proposals submitted to your company by a potential client. They are limited in scope to a particular project or need. A business proposal also generally has a specific audience. The primary reason for a business proposal is to solicit or develop a business opportunity.
A business plan has three elements: description of the business model , the marketing model, and financial projections. It consists of informative sections, including the executive summary, business description, marketing model, analysis of industry competition, build-out plan, operations plan, the introduction of management, and a discussion of financial issues and projection of results. It is introduced by an executive summary, which can be a dense abstract or a longer marketing tool to attract interest in the business plan. The business plan is an informational document designed to factually display your company's operations and potential.
A business proposal is written in response to an RFP--A request for proposal (RFP) is a document that solicits proposal, often made through a bidding process, by an agency or company interested in procurement of a commodity, service or valuable asset, to potential suppliers to submit business proposals --should follow the format requested in the RFP.
Generally, this involves a quick description of your company's services and products that are relevant to the goals of the RFP, a reiteration of the scope of work, answers to specific questions posed in the RFP and a quote detailing materials, tools, labor, delivery and other elements of the cost of the project. An unsolicited business proposal intended to create and develop a business opportunity follows essentially the same format but anticipates questions the potential client might have. A proposal is more of a marketing document, designed to convince the audience to do business by presenting a value proposition and a call to action.
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27 comments on “ the difference between a business plan and a business proposal ”.
Great work! the topic is really an interesting one, well a business plan is something organizing your work like with QuickBooks tool hub, and the business proposal is the opposite of the latter one. For better account, management one should download the QuickBooks tool hub. keep it up the great work. looking towards your next blog.
This could be the best and most simplified article on this issue I’ve come across. Straight to the point and very informative.
I have really liked it and thus so much grateful of the author,,, High arcuity comrades
i have never found it broken down as easy as this before. Thank you. it’s very helpful
Amazing job! The best and most informative article explicitly calling out the purpose and goals of a Business Plan and a Business Proposal.
I really found it helpful. Thank you
Very helpful and informative ,bunch of thanks
Thank you very much for the help.
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I appreciate your thought there with that one, because of course I agree, but I’m confused with why you thought it should be added. Don’t you think plan vs. actual is included with point 3, “It’s specific. You can track results against plan,” and then point 8 “It has to bring the planning process with it, meaning regular review and course correction?”
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As the Republican National Convention (RNC) continues into its third day, speakers and party members have rallied around a firm support of Trump, despite a tumultuous few years that resulted in 34 felony convictions for falsifying business records, among other controversies.
At the RNC , political speakers outlined issues the Republican party considers to be some of the biggest facing Americans, including crime, immigration and identity politics. While some also proposed solutions that would be ushered in under a conservative president, voters don't have to guess Trump's plans; instead, they can simply head over to his website.
Starting in 2022, Trump's official campaign began uploading a series of policy plans to its website, detailing how the Republican candidate plans to tackle some of the country's most pressing issues. Called Agenda47 , the campaign materials paint a big picture of what Americans may expect under another Trump presidency.
Here's what to know about Agenda47.
What to know about Heritage Foundation: Main group behind Project 2025 and RNC sponsor
Agenda47 is the Trump administration's official policy platform for the 2024 presidential election. Outlined in a series of videos and statements on the Trump website, the proposals were released during primary election season.
Many of the actions proposed would be achieved through executive order and touch on topics ranging from climate change and education to the economy and immigration.
The policies are separate from Project 2025, an ultra-conservative initiative created by far-right think tank the Heritage Foundation . Project 2025 is something of a playbook for the next conservative president and details a reimagining of the executive branch and plans to overhaul federal government agencies in a conservative image.
It was created by a team that includes several members of Trump's former staff, but Trump has since attempted to distance himself from the Heritage Foundation after President Joe Biden publicly criticized his ties to the project.
Agenda47, on the other hand, is the official outline for Trump's campaign.
Trump's proposals for education reform focus on defunding and punishing educators and institutions that do not teach conservative values and creating new organizations to enforce rules created around Republican talking points to "save" schools from "Radical Left maniacs."
These plans include:
On the college level, Agenda47 wants to punish universities like Harvard for "turning students into Communists and terrorists" and plans to do away with the existing accreditation system, replacing it with one that adheres to GOP values and heavily fines those that don't comply. With money made from the fines, Agenda47 proposes the creation of a free online “American Academy" with "no wokeness or jihadism."
Anti-immigrant rhetoric is a prominent feature of Trump's 2024 campaign, a fact reflected in Agenda47. In the discussion of policy around immigration, Trump's preamble relies on the message that immigrants are "criminals" and "birth tourists" taking over America.
According to the plan, Trump will sign an executive order on "day one" to end automatic citizenship for children of "illegal aliens."
The agenda also envisions a slew of proposed executive and presidential orders that will:
Agenda47 says it wants to restore "law and order" to address what Trump claims is "out of control crime ."
The plan proposes an investment in hiring, retention, and training for police officers and increasing their liability protections as well as supporting policing policies like stop-and-frisk and local police working with ICE on deportation.
Agenda47 also wants to:
Agenda47 places a focus on pharmaceuticals and medical devices manufactured within the U.S.
Under the plan, essential medical devices and medicines would be manufactured in the U.S. and federal agencies would be required to “Buy American" to prevent shortages.
It also calls for an increase in the production of drugs domestically, bans agencies from other countries from buying "essential drugs" and demands that pharmaceutical companies only be paid the “best price they offer to foreign nations.”
Agenda47 describes proposed economic policies under Trump as "pro-American" and blames Biden's "pro-China" administration for the poor state of the economy.
The agenda proposes cutting federal regulations on resources like energy, cutting taxes, raising tariffs on foreign producers while lowering taxes for domestic producers, imposing universal tariffs on most foreign products, "eliminating dependence on China" and banning federal contracts for any company that outsources to China.
Agenda47 says "Under no circumstances should Republicans vote to cut a single penny from Medicare or Social Security."
In the proposal, Trump blames threats to the programs on Biden's spending and says the Democrats are trying to undo Social Security, though Republicans have previously proposed a higher retirement age and funding cuts.
Trump's agenda proposes cutting tax dollars going to "corrupt foreign countries," "illegal aliens," "left-wing gender programs from our military" and "climate extremism" to save Social Security funding.
The proposal also bans undocumented immigrants from receiving any welfare monies and seeks to address homelessness , banning "public camping" and instead giving unhoused individuals the option to go to some form unspecified of "treatment" or being arrested.
It also proposes the creation of large tent cities to accommodate unhoused people with doctors and social workers on site.
Trump makes apparent throughout his policy plans an anti-LGTBQIA+ stance that specifically targets transgender individuals.
Proposed policies include
Removing any healthcare provider that offers gender-affirming care to youth from Medicare and Medicaid eligibility.
Pushing Congress to pass laws that say “the only genders recognized by the U.S. government are male and female—and they are assigned at birth."
Former President Donald Trump is set to address the Republican National Convention on Thursday after he clinched the GOP nomination—and a years-old platform dating back to the Republican primaries lays out a range of priorities if he’s elected, including stricter rules for schools, more hardline immigration policies, scrapping climate regulations and creating entirely new “freedom cities.”
Former President Donald Trump appears at the Republican National Convention on July 15 in Milwaukee. ... [+]
Trump’s “Agenda47” consists of a series of proposals his campaign issued on its website during the primary election season, from December 2022 to December 2023, many of which may require congressional action but some of which could be enacted through executive orders—separate from the Project 2025 proposals developed by third-party organizations.
Education: Trump’s proposals for K-12 schools include having parents elect school principals, cutting federal funding to any school teaching “critical race theory,” ending teacher tenure, creating a new credentialing body to only certify teachers “who embrace patriotic values,” encouraging prayer in schools, making it easier to kick “out-of-control troublemakers” out of school, supporting school districts that allow teachers to carry concealed firearms and pushing “school choice” policies.
Universities: Trump has proposed getting rid of existing accreditors for colleges and universities and creating new ones who impose his party’s values on institutions, along with levying significant fines on colleges and universities that he believes “discriminate” against students—with a plan to use those fines to create a free online “American Academy” that “cover[s] the full spectrum of human knowledge and skills.”
Climate Change: The U.S. would again leave the Paris Climate Accord, and the ex-president has proposed getting rid of President Joe Biden’s policies restricting emissions and targeting 67% of new vehicles to be electric by 2032 and massively scaling up oil and gas production.
Justice Department: Trump has pledged to appoint 100 U.S. attorneys who would be aligned with his policies and investigate some left-leaning local district attorneys, also pledging to establish a DOJ task force on “protecting the right to self-defense” and fight purported anti-conservative bias at law schools and law firms.
Crime: Trump has vowed to invest in hiring and retaining police officers (and increase their protections from legal liability), push policies like “stop and frisk,” direct the DOJ “to dismantle every gang, street crew, and drug network in America,” deploy federal troops including the National Guard “to restore law and order” when local officers “refuse to act” and impose the death penalty for drug dealers, drug cartels and human traffickers.
Immigration: Trump plans to prohibit undocumented immigrants from receiving any benefits, end birthright citizenship for the children of undocumented immigrants, reinstitute a “travel ban” from certain countries, pause refugee admissions, mandate “extreme vetting of foreign nationals,” block federal grants to sanctuary cities, end the “catch-and-release” practice of releasing migrants while they await immigration hearings, close the southern border to asylum seekers and suspend visa programs including the visa lottery and family visas.
Economy: Trump proposes cutting taxes and slashing federal regulations, also proposing baseline tariffs on foreign goods in hopes of spurring American manufacturing, which will go up for countries who have “unfair trade practices.”
Healthcare: Trump has proposed requiring federal agencies to buy medicines and medical devices manufactured in the U.S. and barring federal agencies from other countries from purchasing “essential” drugs; he also has plans for an executive order saying the government will only pay pharmaceutical companies the “best price they offer to foreign nations.”
Foreign Policy and Defense: Trump wants European allies to pay back the U.S. for depleting its military stockpiles sending weapons to Ukraine; he has also taken a hardline stance on China , calling for new restrictions on Chinese-owned infrastructure in the U.S., and wants to build a missile defense shield.
Social Security: In a shift from some pre-Trump GOP politicians’ views, Trump has said there should be no cuts to Social Security or Medicare “under any circumstances.”
Homelessness: Trump plans to work with states to ban “public camping” by homeless people and instead give them the choice of receiving treatment or being arrested, and calls for creating large “tent cities” where homeless people would be relocated, which would have doctors and social workers on site, along with expanding mental institutions.
Transgender Rights: Trump takes a hard stance against transgender rights, calling for any healthcare provider providing gender-affirming care for youth to be terminated from Medicare and Medicaid, stripping federal funding from any school where an official or teacher suggests a child could be “trapped in the wrong body,” and encouraging Congress to pass legislation saying “the only genders recognized by the U.S. government are male and female—and they are assigned at birth.”
Big Tech: In line with conservatives’ claims that social media platforms are biased against them, Trump said he’ll pass an executive order barring any federal department from working with other entities to “censor” Americans and prohibit federal money being used to combat misinformation, also announcing steps like altering Section 230 to open up social media platforms to more legal liability.
Get Forbes Breaking News Text Alerts: We’re launching text message alerts so you'll always know the biggest stories shaping the day’s headlines. Text “Alerts” to (201) 335-0739 or sign up here .
Trump’s Agenda47 is distinct from Project 2025 , a potential policy blueprint for the next conservative administration—namely Trump’s—developed by the Heritage Foundation along with other third-party groups. While Agenda47 was released directly by the Trump campaign, the ex-president has said he doesn’t have any involvement with Project 2025 and has attempted to distance himself from it, even as the 900-page policy guidebook was created with help from more than 100 people who served in his administration. Trump has also praised the Heritage Foundation’s policy work in the past. The two policy proposals do have many commonalities—like calling to leave the Paris Climate Agreement, kicking out career bureaucrats, pushing “school choice” policies and railing against transgender rights—and it’s unclear how much of Project 2025 Trump could choose to implement if he’s elected.
Many of the items in Agenda47 and Project 2025 would probably require acts of Congress, but both agendas have proposed expanding the president’s control over the executive branch. Trump’s Agenda47 proposes reviving Trump’s 2020 executive order (which Biden rescinded) that makes it significantly easier to replace career civil servants with political appointees. He also wants to “overhaul federal departments and agencies” to get rid of “corrupt actors,” crack down on government leakers and implement a “Truth and Reconciliation Commission” to fight what the GOP calls the “Deep State.”
Since the last Agenda47 video was released in December 2023, Trump has announced other policy proposals separate from those released under the Agenda47 heading. On abortion , Trump has said he believes that the issue should be left to the states—though many abortion rights advocates still believe he’d restrict abortion if elected. He and the GOP have also vowed mass deportations of undocumented immigrants, which is not mentioned in Agenda47’s immigration plans. He’s also pushed to eliminate the federal income tax on tips for service workers.
What Trump will do once in office if he’s elected. Agenda47 was released during the primary election and it's unclear if Trump will temper his proposals to appeal more to a general electorate as Election Day nears. The Trump campaign has not yet responded to a request for comment on if the ex-president’s agenda has evolved at all since the last Agenda47 proposals were released last year. In addition to Agenda47 and Project 2025, the Republican National Committee has also released its own policy platform that a future Trump administration would also likely take into account, though that echoes many of the priorities already outlined by Trump and the Project 2025 authors—often in less detail.
In addition to proposals around more expected issues like immigration, education and defense, Trump’s Agenda47 also includes a proposal for “freedom cities,” as the ex-president has called for using federal land to create up to 10 new cities, which would be roughly the size of Washington, D.C. Plans for the cities would be chosen via a nationwide contest, and Politico reported in March 2023 Trump’s proposal includes investing in “vertical takeoff-and-landing vehicles” akin to human-sized drones and “baby bonuses” in hopes of staving off a declining birth rate.
Trump formally garnered enough delegates to nab the Republican nomination on Monday afternoon as the Republican National Convention kicked off, securing his candidacy right as he announced Sen. JD Vance, R-Ohio, as his running mate. The ex-president released his Agenda47 videos as he faced what was initially a crowded field of Republican primary candidates, though Trump ultimately proved to be the clear frontrunner, clinching the nomination in March. The GOP’s policy proposals have come under increased scrutiny in recent weeks as the convention has neared—and as Democrats used the controversial Project 2025 to oppose Trump’s candidacy while President Joe Biden faced criticism over his age—though Project 2025 and Agenda47 have both been published since last year.
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COMMENTS
The main difference between a business plan and a business proposal is that a business plan documents your growth strategy while a business proposal is a specific ask for someone to take an action you desire (e.g., buy your product/service, invest in your company, partner with you, etc.). In this article, we will define a business plan and a ...
Business Plan. Business Proposal. Purpose. Outlines a company's mission, vision, and means to achieve its goals. Proposes a specific project or solution to a client or potential partner. Audience. Investors, stakeholders, financial institutions, and internal team. Potential clients, partners, or businesses. Content.
Business Plan vs. Business Proposal. A business plan and a business proposal are different from each other by content, goals, writing style, and structure. The major difference between both is that a business plan is a document that presents facts, while a business proposal is a request for a deal and a quotation of prices. A Business Plan
A promising business plan talks about the company's future financial performance - expenditure, profit, revenue, etc. Explore new business opportunities. A business plan is a flexible document that enables learning on the go. It bolsters research and infuses businesses with new and more feasible business opportunities.
Key Differences between a Business Plan and a Business Proposal. Purpose: A business plan is primarily used for strategic planning and securing investment, while a business proposal is aimed at winning a specific contract or project. Audience: The audience for a business plan is typically potential investors, stakeholders, or company management ...
A business plan is a comprehensive document that outlines the goals, strategies, and financial projections of a business, while a business proposal is a focused document that is used to pitch a product or service to potential clients or investors. Understanding the differences between the two documents is essential for any business owner ...
While a business plan provides a thorough overview of the entire business and targets internal stakeholders, investors, and lenders, a business proposal focuses on specific projects or opportunities and targets external clients, partners, or funding agencies. When you understand these differences and employ the best practices in creating both ...
A business plan is a comprehensive document that outlines the overall vision, strategy and goals of your business. In contrast, a business proposal is a targeted pitch to a specific client or ...
A business plan describes your business goals, strategies, and financial projections. A business proposal, on the other hand, proposes a specific solution to a problem or opportunity and helps you persuade the relevant stakeholder to invest in your business. However, writing a business proposal or a business plan can be challenging, especially ...
A business proposal, on the other hand, is a sales document that you put together to pitch potential projects to clients.It's not the same as a business plan, and it usually includes cost quotes for potential projects. The main difference between a business proposal and a business plan is that, while a business plan is informative, a business proposal is intended to showcase operations, goals ...
Differences between a business proposal and a business plan. A business proposal is not the same as a business plan.This is the most common misconception, but while there are areas of overlap (like your executive summary) the two are different.. That being said, you can certainly pull information from your business plan while writing your business proposal—in fact, that's a great way to start.
Updated November 12, 2020: Conducting a comparison between a business proposal and a business plan enables you to highlight the differences between the two. Business plans are documents detailing how owners want to set up their business, their goals and objectives, and the processes and methods required to achieve these goals.
Business proposals differ from business plans in content, writing style, purpose, goals, and structure. The sole distinguishing factor between the two terms is that a business plan is a factual presentation of facts, whereas a business proposal is an external market document that highlights a quote and a call to action.
A business plan is a factual broad description of a company on the executive and operational level. A business proposal is a focused sales document intended to describe how a company will approach ...
3:I[5613,[],""] 5:I[1778,[],""] 4:["slug","business-plan-vs-business-proposal","d"] 0:["QsP_lgIWRSCs_WgBQ9Ouk",[[["",{"children":["resources",{"children":["business ...
These two documents are very different. A business plan is different from a business proposal in terms of content, structure, writing style, goals, and purpose. The most important difference to note is that a business plan is a written presentation of fact while a business proposal is a price quote and a call to action. Definition.
The difference between a business plan and a business proposal. A business plan is the roadmap for a business and shows the overall strategy, goals and vision for success. It shows how a business operates and how it will make money. ... If your proposal isn't for a specific project, give an idea of general timeframes your business works to ...
A business plan is a living document that's subject to change in order to keep up with the business' needs. On the contrary, a business proposal is a persuasive document that's used to bring more money into the business through business deals and sales. Promoting existing goods and services characterise a business proposal, which in turn ...
A business proposal describes what you can deliver, time frame, amount, cost and your terms and conditions. This is a document you would use to respond to a specific request from your client, or you would send it to your client or prospect describing what you can deliver, at what price. When you respond to a specific request, also known as an ...
Length differences. Whilst business plans usually span between 15 and 30 pages, business proposals vary in length, based on what information the client has requested. 10 pages is usually a good starting point for a business proposal and not many will eclipse this number. This means that a business proposal has fewer pages than a business plan ...
Now let's talk about what are the different types of business proposals. By knowing the difference between types of business proposals, you'll know exactly which proposal to send to each client. There are six different types of business project proposals: formally solicited. informally solicited.
In your business proposal, you will detail the scope of the work, materials needed, cost estimates, project timeline, previous clients, team members, achievements, and a whole lot more in the body of the proposal. It's a marketing tool, and its goal is to convince the target customer to do business with you.
A business plan is a factual broad description of a company and its prospects. A business proposal is a focused sales document intended to describe how a company will approach a project, state the value of the project to the client, and solicit the client's business. A business plan is a written presentation of facts.
We explore the differences between a loan proposal and a business plan, providing a blueprint for effective proposal drafting. Whether you're an experienced entrepreneur or starting your first venture, mastering business loan proposals is vital for financial success. ... plan, and collateral offered. Unlike a business plan, which provides a ...
What Agenda47 says about education. Trump's proposals for education reform focus on defunding and punishing educators and institutions that do not teach conservative values and creating new ...
Education: Trump's proposals for K-12 schools include having parents elect school principals, cutting federal funding to any school teaching "critical race theory," ending teacher tenure ...