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  How to Structure Proposals to Get Bigger Clients

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"How to Close Deals at a Higher Price"

Course Transcript

How to Format your Proposals to Build Value

I want to talk to you about putting a proposal together in sales. Most people think of a proposal as telling people what you're actually going to do for them. I love the idea, but it's incorrect. A proposal's idea should be telling them what they're going to get. The true value of a proposal is showing them enough value to where they say, "Yes." So, I'm providing value for the close. There is your critical piece. The critical word there is "value." What are they getting? If you just tell them what you're going to do, it's not going to land. It's going to allow them to begin to compare and contrast. I want them to think in their heads, "This is going to get me what I want." If I give good value, the odds are very high they say, "Yes." But if they don't say yes, they may do what they usually do, which is they hesitate.

Hesitation is better than no, and actually more common. But they also may fight me on price. Hesitation means I can somehow try to get around them if I can. I got to make it work if I can get through hesitation. But fighting me on price is actually not a bad thing. Fighting me on price says they see the value, just not as much as I see. Good. I'd rather have them fighting me on price if I have a choice. Hesitation can be scary. We'll cover that in a minute. But the idea is, remember, proposal's goal - value for the close.

What does that mean? Whenever possible, avoid any hourly rates. To the best of your ability, do not charge people by time. Time is not value. They don't want to pay for your time. They want to pay for what they want to get. They want to pay for a benefit, so try to avoid hourly rates whenever possible. Try. I know some of you can't, but every time you can, don't do that. People will tell you, "You have to make sure your hour rates are good." Hourly rate, they had coaches talk about that, "Make sure hourly rate is this or that." They're all wrong. If you are a sales rep, hourly isn't going to help you because you're getting paid by the overall price anyway. If you're a small business owner, hourly rate? You're always working. Stop with your hourly rate stuff. How much money you bring in every week, or quarter, or month. That's what I care about. You're always working.

Either way, hourly doesn't work. Not just that, hourly makes them think, "I'm paying for your time? $100 for an hour? That's a lot of money? $200 for an hour? That's a lot of money." Versus $20,000 for a benefit. $100,000 for a benefit. Your time is not what they care about. They don't want to pay for that, so try your best to not do that.

Next. When you're talking about what you're going to do for them, try to tell them what they're going to get. You can bring up facts, what you're going to do or what matters. It's fine, but make sure there is a benefit to it. A great way of starting your proposal is talking about your company, whatever that is. But only bring up aspects that matter. If you just say something like ... We always do this, I know you hear it all the time: "We've been in business since 1993. We have offices in three countries." So what? What does that mean to them? If you can't link it directly and obviously to a benefit, your fact has no value.

Do not think they're going to get that, "Well, we've got 12 years experience." So what? Someone's got 13. Someone's got 14. That's not impressive. Why is 12 years important? And I want you to actually say it or write it out, but it's got to be obvious. So I might say something like this, as an example: "You know, we've been around since 1999, and what that means to you is ..." Yes. Literally say that, "What that means to you is ... What you can be sure of is ... How that benefits you is ... Why that matters is ..." That clear of a transition statement so they know this amount of experience means something for them. If you just say 12 years, 18 years experience, someone has more. But if you say 12 years of experience means you get ... is important because ... that tells them 12 years is the right amount of experience. Fact. Benefit.

"We have offices in three countries." So? "We're ranked number one." So? Say why that matters. "We're ranked number one so you can be sure you get the best." Now that's something that matters. "We're in three different countries, which means you can get ahold of us no matter where you are." Okay, now we've got value. I want it to be that obvious. You're saying, "Larry, they get it. Come on. They get it." No. They don't. They don't get it for two reasons. Number one: they're not in your head. They're in their own head. That's step number one. But step number two: they are absolutely predispose to not hearing you. You're pitching them right now. If you're pitching them, they don't want to believe you. They don't want to hear you, so of course they're not going to make A to B to C. You must make it for them. Fact with benefit. That is a critical aspect of your proposal.

So, you can either say this: fact with a benefit; or fact, fact, fact, fact, fact, benefit. So, we will do X, we will do Y, we will achieve Z, our people will do this, we will do that, which means for you "wrapped up benefit." Or, we're going to do this, so you get this. We're going to do this, so you get this. We do this, so you'll get this.

Why is this so important? If you just say what you're going to do with prices, which is what many people do, you've just encouraged me to line item out things. "Well, you don't need 10 hours, you can do it in five. Oh, I don't need this. Oh, I don't need that. Take the price off for these." I'm going to line item out things, and when I line item them out, guess what? I still expect the same benefit. I still want my results. I just don't want to pay for them. You've given me a way of doing that, so I'm going to cross these things out, pay a lower price, you're going to do less work, I'm not going to get the results that I want, I'm going to blame you. Yeah. I'm going to blame you, and I should. You shouldn't have done that. Instead, say you need all these things to achieve this, and then I step up and say, "No, I don't want this, I don't want that." You then say, "Great, then I guess you don't get this, because you need this to get this, and the benefit is what you want."

How do I know what the benefit is? I hope I did a good job of asking questions, if you watched the videos of asking questions and know what they actually want, so my proposal is now a home run. If I've done that right, they can't line item out. They can't decide "I don't want," because they don't get their benefit. Now, if they agree to a lesser benefit, we're okay. Give them a lesser price. They don't want as much work. They don't want as much. Lower the price, no worries. That becomes an equal back and forth. Now we're okay, but we don't just want to list things without a benefit. The benefit is the critical piece, the critical aspect to you. If, while you're giving your presentation, or your proposal, or showing what you're doing and the value, try to have success stories along with that. But success stories that connect directly to what they want. How do you know that? You've asked the right questions. You've seen how they've gone back and forth during your presentation and your facts and benefits. Now, we can now expand on what matters.

If you see that some facts and benefits you talk about, they seem uninterested, you can bring it up: "You didn't seem interested in this. Is this not important to you?" If it isn't, now you know where you can cut, where you can pull things out and change, if you want to. Your proposal's always about that. You might say, "Larry, do I want details? Do I want the specifics?" Yes. But you don't want them in the proposal itself. You want a proposal, and if you want details, or a contract, or an agreement, that should be either a physical, separate sheet of paper, or at the end. The proposal is just what they're going to get. It's much more benefits, benefits, benefits.

If there are details, caveats, specifics, have them available, but you'd be surprised, if you've done the job well, how often they don't care. How often they don't look at details until after they've said, "Yes." They say, "Yes," then go, "Great, we've agreed, now what are the details?" That's what I always want, because now, it's a "Yes." We're just negotiating how do we get there. I'm happy with that every day of the week, no worries. So, again, separate pieces based upon what's important, and assume close. You will get, you will achieve, we will try, we will move. If you can guarantee your proposal, please guarantee. If you can't guarantee, say what you'll begin, what you'll start, what you'll try, what you'll attempt, where you'll go. Say those things. These are important pieces.

There's on more aspect to your proposal. To the best of your ability, have a timeline. Let them know what they're going to get, and when they're going to get it. If your plan takes six months, one week, three days, put that. Day one, day two, day three. You'll get this, get that, get this. Timelines give people a warm, fuzzy feeling. It makes them feel like they have more control, and particularly if you're in a situation where people pay money upfront before they get something, a timeline helps a lot for them to feel better and not have buyer's remorse. So remember, in your proposal, value, value, value. Try to avoid, whenever possible, the hourly rate. Make sure you're doing facts plus benefits. Every fact has a benefit, or all the facts create a benefit, and then at the end, wrap it up with good success stories and a timeline.

Pricing. When you assign pricing, try your best to have three or four rules on pricing. I'll give you those rules in the next video.

Access the rest of this Series:

"How to Close Deals at a Higher Price"