Proposal & Pricing

Core Principles

1. A proposal confirms a decision already made — it doesn't make the case from scratch. If you're relying on the proposal to sell for you, your discovery and demo failed. The proposal should feel like a formality that documents what you've already agreed on verbally.
2. Price is always relative. Anchor high, justify with value. Never lead with price. Lead with the cost of their problem. When a $50K solution solves a $500K problem, it feels cheap. When it's presented without context, it feels expensive.
3. Three options beat one option. A single price is a take-it-or-leave-it. Three tiers give the buyer control and almost always push them to the middle option. This is anchoring, and it works.
4. Never email a proposal you haven't presented live. Proposals that get emailed into the void have a close rate 40-60% lower than proposals presented in a meeting. Present first, send the document after as a reference.
5. Every proposal needs a deadline. Not a pressure tactic — a respect-for-your-time signal. "This proposal is valid for 30 days." Without a deadline, proposals sit in inboxes for months.

Proposal vs. Quote vs. SOW

These three documents serve different purposes. Using the wrong one at the wrong time signals inexperience.

When to Use a Proposal

Use a proposal when you are selling a new relationship, not just a transaction. Proposals make the case for why, not just what and how much. Any deal where the buyer needs to be convinced — not just informed — needs a proposal.

• First engagement with a new customer.
• Competitive or RFP situations.
• Deals involving multiple stakeholders or a buying committee.
• Complex engagements where scope, approach, and outcomes need to be explained.

When to Use a Quote

A quote is a pricing document with no persuasion. Use it when the buyer already knows what they want and just needs the number and terms. Quotes are transactional.

• Renewals or expansion deals with existing customers.
• Add-on purchases where scope is obvious.
• Commodity products where the buyer is comparing prices.
• When the buyer explicitly says "just send me a price."

A quote should contain: line items, quantities, unit prices, totals, payment terms, validity date. Nothing else.

When to Use a SOW (Statement of Work)

An SOW is a legal-grade scope document. It replaces or accompanies the proposal once the deal is verbally agreed and the buyer needs a formal document for procurement, legal review, or internal sign-off.

• Professional services, consulting, and implementation engagements.
• Any deal where deliverables, milestones, and acceptance criteria matter.
• When procurement or legal requires a formal scope document to release a PO.
• When the buyer's finance team needs a document tied to budget line items.

Use a proposal to win the deal. Use an SOW to formalize it. Sometimes you need both. Never use only an SOW when you still need to sell — it reads like a contract, not a pitch.

Proposal Length Guidance

Proposal length is not arbitrary. Match it to the deal complexity, buying committee size, and procurement requirements.

Short Proposals (3-5 pages)

Use for:

• Deals under $50K.
• Single decision-maker (no buying committee).
• Follow-up to a strong discovery call where alignment is clear.
• Services or products the buyer already understands.

Include: executive summary, problem/solution fit, pricing table, next steps. Skip the case study section — drop a single testimonial into the exec summary instead.

Standard Proposals (6-10 pages)

Use for:

• Deals from $50K-$250K.
• 2-4 stakeholders involved.
• Some competitive pressure.
• Engagements that need scope explanation.

Include the full structure: exec summary, problem, solution, proof, pricing, next steps. This is your default.

Long Proposals (12-20 pages)

Use for:

• Deals over $250K.
• Formal procurement process or buying committee of 5+.
• RFP responses (see RFP section below).
• Enterprise deals where the proposal circulates to people you'll never meet.

Include everything in the standard proposal plus: detailed implementation plan, team bios, security/compliance overview, detailed case studies (3-5), risk mitigation approach, SLA terms.

The rule: Every page must earn its place. Long proposals aren't padded short proposals — they contain sections that address real concerns from different stakeholders. If a page doesn't answer a question someone on the buying committee would ask, cut it.

Visual & Design Guidance

Ugly proposals lose deals. This isn't vanity — it's trust signaling. A sloppy document makes the buyer wonder what your actual work product looks like.

Non-Negotiables

• Branded header and footer on every page. Logo, company name, contact info. Use consistent colors. This isn't optional.
• Whitespace is your friend. Dense walls of text signal "I didn't think about the reader." Use margins, spacing between sections, and breathing room around tables.
• One idea per page. Don't cram the problem section, solution, and pricing onto a single page to "keep it short." Short proposals have fewer sections, not cramped ones.
• Consistent typography. Two fonts max. One for headings, one for body. Use bold for emphasis, never underlining.
• Professional tables for pricing. No plain-text pricing lists. Use formatted tables with clear column headers, alternating row colors, and the recommended tier highlighted.

Design Elements That Win

• Customer logos in the proof section. Recognizable logos build instant credibility. Get permission first.
• Charts over paragraphs. A bar chart showing "Current State vs. Projected State" communicates ROI faster than three paragraphs. Use simple charts — nothing fancy.
• Pull quotes from discovery. Drop their own words into callout boxes: "We're losing $340K/year to manual handoffs." — VP Sales, Discovery Call. This proves you listened.
• Implementation timeline as a visual. A horizontal Gantt-style graphic beats a bullet list of phases.

What to Avoid

• Stock photos. They cheapen everything.
• Clip art or generic icons from the early 2000s.
• Inconsistent formatting (some sections have headers, others don't).
• PDF exports from Google Docs that look like Google Docs. Use a template.

Tool recommendation: Canva, Figma, Pitch, or Qwilr for polished proposals. Google Docs and Word are fine if you use a real template — not the default.

Proposal Structure

1. Executive Summary (Half a page)

Written for the person who won't read the rest. Must contain:

• The problem (in their words from discovery).
• The cost of doing nothing (quantified).
• Your solution (one sentence).
• The expected outcome (specific metric or result).
• The investment (total, not broken down — that's later).

[Company] is currently losing approximately $340K annually in sales
productivity due to [problem from discovery]. This proposal outlines how
[Your Company] will [solution], targeting a [X]% improvement in
[metric] within [timeframe] — representing a [X]x return on a
[$X] investment.

2. The Problem (1 page)

Restate what you learned in discovery. Use their quotes if you captured them. This section should make the reader feel the pain again.

• Current state (what's happening now)
• Impact (what it's costing them — dollars, time, risk, opportunity cost)
• Root cause (why their current approach isn't working)
• Urgency (what happens if they wait another 6-12 months)

3. The Solution (1-2 pages)

Map your solution to their specific problems. Not a feature list — a problem-to-outcome map.

Include implementation approach and timeline. Buyers want to know how this actually happens.

4. Proof (1 page)

Case studies, metrics, and testimonials. Pick the ones closest to their situation.

• Case study format: "[Company] had [same problem]. We [solution]. They achieved [result] in [timeframe]."
• Include 2-3 relevant case studies. Quality over quantity.
• Logos of recognizable customers in their industry.
• One strong testimonial quote.

5. Pricing (1 page)

Present pricing in a three-tier structure. See the pricing section below for details.

6. Next Steps (Half a page)

Make it dead simple:

1. Sign the agreement by [date].
2. Kickoff call scheduled within [X] days of signing.
3. [Phase 1 milestone] completed by [date].
4. First results visible by [date].

Include who to contact and how to sign (e-signature link is best).

Three-Tier Pricing

Always present three options. Name them by the outcome the buyer gets, not by generic tier labels.

Bad names: Starter, Growth, Enterprise. These are lazy and tell the buyer nothing.

Good names depend on your offering. Examples:

• Consulting engagement: "Foundation Audit" / "Full Transformation" / "Embedded Partnership"
• SaaS platform: "Team Essentials" / "Revenue Acceleration" / "Total Revenue Intelligence"
• Implementation project: "Quick Start (Go-Live in 30 Days)" / "Full Deployment (90 Days)" / "Enterprise Rollout + Optimization (6 Months)"

The name should answer: "What will I have when this is done?"

Anchoring strategy:

• Tier 3 (highest) is the anchor. It makes Tier 2 look reasonable.
• Tier 2 (middle) is where you want them. Price it at 60-70% of Tier 3.
• Tier 1 (lowest) is the "floor." It should solve their problem but leave them wanting more. Price it at 40-50% of Tier 3.

Bold or highlight the middle tier. Most buyers will choose it.

ROI Justification

Build the ROI case before presenting price. Use this framework:

Cost of Inaction

• "What does this problem cost you per year?" (Use numbers from discovery.)
• "Over 3 years, that's $[X] in [lost revenue / wasted time / unnecessary headcount]."

Payback Period

• "At $[price], you'll see ROI in [X] months based on [specific metric improvement]."
• Use conservative estimates. Overpromising kills trust.

Total Value Delivered

• "Based on what similar companies have achieved, we expect [X]% improvement in [metric], which translates to $[Y] in annual value."
• Express ROI as a multiple: "That's a [3-5]x return on your investment."

Comparison Anchor

• "Your current approach costs $[X] per year (fully loaded — salaries, tools, opportunity cost). Our solution replaces $[Y] of that."

SOW Template Sections

When the deal needs a formal SOW:

1. Parties — Your company and theirs, with signing authorities.
2. Scope of Work — Detailed deliverables, phases, milestones.
3. Timeline — Start date, phase durations, completion date.
4. Deliverables — Specific outputs with acceptance criteria.
5. Assumptions — What you need from them (access, data, personnel, decisions).
6. Out of Scope — Explicitly list what's not included. Prevents scope creep.
7. Pricing & Payment Terms — Total, payment schedule, invoicing terms.
8. Change Process — How to handle scope changes and their cost impact.
9. Acceptance Criteria — How deliverables are approved.
10. Terms — Duration, termination, IP ownership, confidentiality.

Mutual Action Plan (MAP)

Modern B2B deals — especially $100K+ — use a MAP alongside the proposal. A MAP is a shared document between you and the buyer that outlines every step from "proposal sent" to "deal closed and kickoff complete." It replaces the vague "let us know when you're ready" with a concrete timeline both sides commit to.

Why MAPs Win Deals

• They surface hidden steps early. The buyer realizes they need legal review, security assessment, and budget approval — before those things become surprise delays.
• They give you legitimate reasons to follow up. You're not "checking in." You're referencing the shared plan.
• They signal professionalism. Buyers who've worked with vendors that use MAPs immediately trust you more.

MAP Template

How to Introduce It

Present the MAP at the end of your proposal review meeting: "I've put together a shared plan for the steps between now and kickoff. This way we both know what's coming and nothing falls through the cracks. Does this sequence look right to you?"

Let them edit it. A MAP they co-own is ten times more effective than one you impose.

Where to Keep It

Google Sheet or Notion page — something both sides can access and update. Not buried in an email thread. Not a PDF. It needs to be a living document.

RFP Response Guidance

RFPs are a different game. Most of the principles above still apply, but the format, strategy, and constraints change.

The Uncomfortable Truth

Most RFPs are written with the incumbent or a preferred vendor in mind. If you weren't involved before the RFP was published, you're likely Column B — the comparison vendor who makes the chosen vendor's price look reasonable. Ask yourself honestly: did they reach out to us, or did we find this on a portal?

When to Respond

• You were involved in shaping the requirements (strong signal).
• You have a champion inside who confirms you have a real shot.
• The RFP aligns closely with your core offering without significant customization.
• The deal size justifies the effort (RFP responses take 20-80 hours).

When to Walk Away

• You found the RFP on a public portal with no prior relationship.
• The requirements read like they were written for a specific vendor (and it's not you).
• The timeline is unreasonably short (they want the illusion of competition).
• You'd need to lie or stretch the truth to meet key requirements.

How to Respond

1. Answer every question. Skipping questions is an automatic disqualification in most scoring rubrics. If you can't do something, say so honestly and explain your alternative approach.
2. Lead each answer with the outcome, then explain how. RFP evaluators read dozens of responses. "Yes, we do this" is forgettable. "We've helped 40+ companies reduce onboarding time by 60% using [approach]" is memorable.
3. Use their language. Mirror the terminology in the RFP. If they say "customer success," don't substitute "account management." Evaluators often score with a checklist.
4. Include an executive summary they didn't ask for. Even if the RFP doesn't request one, add a one-page cover letter that makes the case for why you, specifically, are the right choice. This is the only section where you can sell.
5. Propose a conversation. Most RFPs discourage direct contact. Do it anyway, professionally: "We'd welcome the opportunity to discuss our approach in more detail. Please don't hesitate to reach out." Some evaluators will take you up on it.

Present Live vs. Send

Always present live. Here's how:

1. Schedule a 30-minute "proposal review" meeting.
2. Share your screen. Walk through each section.
3. Watch their reaction to pricing — are they nodding or flinching?
4. Address concerns in real-time.
5. Ask for the close at the end of the meeting.
6. Send the document afterward as a reference, not a first impression.

If they insist on receiving it first:

• "Happy to send it over. Can we schedule 20 minutes to walk through it together? I want to make sure the pricing structure makes sense in context." This way they review it, but you still get a live conversation.

Avoiding Proposal Black Holes

Proposals disappear when:

• You sent it to someone who can't decide. Always confirm: "Are you the one who signs off on this, or does it go to someone else?" Get to the decision-maker before sending.
• There's no urgency. Include a validity date: "Pricing valid through [date]."
• They don't understand the value. If the proposal lands without a live walkthrough, the pricing page is the only thing they'll read.
• You don't follow up. Schedule follow-up before you send: "I'll send this over today. Can we plan to reconnect on [day] to discuss any questions?"

Follow-up cadence after sending:

• Day 1: Send proposal + confirm receipt.
• Day 3: "Any questions so far?"
• Day 7: "Wanted to check in — have you had a chance to review? Happy to jump on a quick call."
• Day 14: "I know this might have shifted in priority. If the timing isn't right, no pressure — just let me know so I can plan accordingly."

Discount Strategy

When to discount:

• To close a reference customer in a strategic account.
• To accelerate timing (annual prepay, multi-year commitment).
• To win a competitive bake-off where you're confident in long-term expansion.

When NOT to discount:

• Because they asked. Asking is not a reason.
• To "make the deal work." If they can't afford it, they're the wrong customer.
• On the first ask. Always hold the first time. They're testing you.

How to discount without losing value:

• Trade, don't give. "I can do $X if you sign by [date] / commit to annual / provide a case study."
• Remove scope instead of cutting price. "I can bring the price down by $X if we drop [deliverable]."
• Never discount more than 15-20% without executive approval. Larger discounts signal your list price is fake.

Worked Example: AI Consulting Proposal Outline

Here's a realistic proposal outline for a $120K engagement — an AI revenue operations transformation for a $8M SaaS company with a 12-person sales team.

Page 1: Cover Page

• Your company logo, their company logo
• "AI Revenue Operations Transformation — Proposal for Acme SaaS"
• Date, validity ("Valid through [date + 30 days]")
• Prepared by [Name, Title]

Page 2: Executive Summary

• Their problem: Sales team of 12 spending 40% of time on non-selling activities. Win rate declined from 32% to 24% over 18 months despite adding 4 reps. Revenue per rep: $220K (industry benchmark: $380K).
• Cost of inaction: $1.9M/year in unrealized revenue based on benchmark gap.
• Your solution: 90-day AI revenue operations sprint — restructure lead routing, automate call prep and follow-up, implement AI coaching on recorded calls.
• Expected outcome: Revenue per rep to $310K within 6 months (41% improvement). 4.7x ROI on engagement.
• Investment: $120K (recommended tier).

Page 3: The Problem

• Discovery quotes from VP Sales and CRO.
• Data: current pipeline velocity, win rate trend, rep productivity breakdown.
• Root cause: manual processes, no AI tooling, reps doing admin instead of selling.

Pages 4-5: The Solution

• Problem-to-outcome table (3 rows).
• 90-day implementation timeline visual (3 phases: Audit, Build, Optimize).
• Team: who from your side, who from theirs.

Page 6: Proof

• Case study: "Similar SaaS company, 15 reps, achieved 38% improvement in 4 months."
• 3 customer logos.
• One pull quote.

Page 7: Pricing

Page 8: Next Steps + MAP

• Signature by [date].
• Kickoff within 5 business days.
• Mutual action plan table (see MAP section above).

Total: 8 pages. Clean, visual, decisive.

Output Format

When building a proposal, deliver:

1. Proposal document — Following the structure above, customized to the prospect.
2. Three-tier pricing table — With outcome-based tier names, anchoring strategy, and recommended tier highlighted.
3. ROI justification — Cost of inaction, payback period, total value.
4. Presentation talking points — What to say when walking through each section live.
5. Follow-up plan — Cadence and messaging for post-proposal follow-up.
6. SOW outline — If the deal requires formal documentation.
7. Mutual action plan — For deals $100K+ or with complex buying processes.

Related Skills

• discovery-call — Everything in the proposal comes from discovery. If you can't fill in the problem section, go back to discovery.
• negotiation — When the proposal triggers price pushback or contract negotiation, switch to the negotiation skill.
• objection-handling — Objections at the proposal stage often mean the proposal didn't address something from discovery. Use ACRC framework.
• competitive-intel — If competitors are in the mix, your proposal needs to subtly position against them.
• buyer-persona — Understanding who reads the proposal determines how you write it.