A lot of businesses and consumers use the terms proposal and quotations interchangeably. But as per widely accepted definitions, a quote and a proposal are very different. You as a business may be clear on the differences between these documents, but you must clarify and understand if the prospect asking for any of these documents is also on the same page as you on expectations and delivery.
For instance, they may ask for a quote but what they want is a proposal. So, before you get cracking at their request, discuss the details and gain a comprehensive understanding of the exact requirements of what they want.
A few questions you can ask them:
- Do they want exact costs to be included?
- Do they want to see an itemized breakdown of the costs and services?
- Are they expecting a comprehensive proposal with detailed information about your expertise and tailored solutions so they can get a ‘buy-in’ from stakeholders?
- Does your prospect want a rough estimate?
Answers to these questions will help you tailor the document and give them exactly what they expect without going back and forth, thus accelerating the sales process.
Contents
What is a Sales Quote?
A quote is an itemized list of products, services, labor charges, if any, additional charges like shipping, installation, etc., with fixed prices for most and maybe a few variables subject to a specific time frame, for instance, ‘valid for 15 days’.
The validity of a quote is important when there is fluctuation in the prices, so businesses include this disclaimer to protect themselves.
A quote is a legally binding document, and once a prospect accepts it, you have to honor the prices quoted and the work detailed. Hence, when you create a quote, you must have a clear understanding of the clients’ requirements, and detail the exact items, services, inclusions, exclusions, the scope of work, timelines, etc.
9 MUST-DOs to create a winning sales quotation
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Understand the prospect’s requirements
Before you offer solutions and start creating a quote, always understand the customer’s needs. Research them even before the first meeting to understand the nature of their industry and business.
Make detailed notes of the conversations you have with them, ask questions to get to the root of their problems. A sales quote should reflect that you have clearly understood the prospects’ challenges and have solutions to address those specific challenges in totality.
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Customize quotations to meet those requirements
Only when you understand the prospects requirements in detail can you tailor solutions to meet those specific requirements?
Customized quotations convey to the client that you have understood their problems and go a long way in building trust and confidence in your services. A customer-centric approach will hold you in good stead, and the resulting sales quotation will be a perfect fit for your prospect.
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Include appropriate details
Your quotation should include all the necessary information about your business as well as the prospects information. List all the products, services, inclusions, exclusions and prices in a well-structured and uniform format.
Ensure that the product names have a clean and normalized taxonomy and do not look cluttered. The idea is to give your prospect a clear and detailed view of the products and services you have to offer, not confuse with unnecessary and overwhelming information.
Read What is Product Database Normalization And Why Is It So Important?
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Deliver the quote on time
Always know that you are not the only business that the prospective client has asked for a quote. Typically a prospect approaches a minimum of three vendors for a quote. The faster you respond with an ideal quote, the greater are your chances of winning the deal.
A late quotation, or a quote delivered after a reminder from the prospect, affects the image of your brand and may hamper any future dealings. Ideally, you should respond with a quote within 24 hours. A good cloud hosted sales quotation solution, like VARStreet, will help you quickly create quotes from anywhere, helping you respond to requests faster.
VARStreet also has a Mobile Quoting App so you can create quotes and send them to prospects on the go without having to get to a computer or your office.
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Give your customers options
Often customers are unsure of what they want or are not aware of different options available in the market. You, as a value-added reseller are an industry expert and can offer them a solution better suited than what they initially requested.
Interactive sales quotes with relevant upsell and cross-sell suggestions offer a greater value to your prospects and boost their confidence in your expertise.
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Include a eSignature option
This is now the digital age, and if you still email or fax your quotes to customers and then wait for them to sign the quote and send it back to you, then well, you are losing out on the benefits of technology.
Sales quotation software with digital signature technology accelerates the turnaround time, eliminates cumbersome paperwork and helps you close deals faster.
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Always follow up
Following up with the prospect after you have sent them a quote is as important as the quote itself. It helps you assess the reaction of your prospect to your quote and allows you the opportunity to address any concerns they may have. Without a follow up from you, the prospect may go with another vendor whose quote was better than yours, but if you do get back to them, you still stand a chance of reworking the quote on additional inputs from the prospect.
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Use an integrated CRM and quoting software
The sales quoting process, if done manually, is time-consuming and error-prone. A sales quoting solution like VARStreet automates the process and makes it effortless, accurate and efficient. The sales quotation software comes with a FREE CRM to build efficiencies in your business operations in totality. VARStreet’s quotation tool also comes with ready distributor integrations with a catalog of over 7 million IT and office supply SKUs from 45+ distributors in the United States and Canada.
Your sales teams have access to accurate and real-time price and inventory information from multiple distributors you partner with right at their fingertips. They can quickly and easily add products to the sales quotes, complete with FREE rich content like images, videos, product descriptions, tech spec, etc., from Etilize and IceCat to enhance the quotations.
With the use of an integrated quoting solution like VARStreet, you can accelerate your sales quotation process and increase the conversion rate for your business.
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Always ask for feedback
Lost deals have a lot to teach you. Speak to prospects who did not accept your quotation, ask them the reasons for not choosing you. This feedback will give you valuable insights into your sales quotation process and help you to improve it.
Also read How to Write a Professional Sales Quote: Detailed Guide and Proven Tips
What is a Sales Proposal?
A sales proposal contains the information in a quote, plus the value that a business can offer a prospect. Potential clients often request proposals from multiple vendors, so when you submit your proposal, you essentially are competing against several other companies for the client’s business. It is essential that your proposal stands out and showcases maximum value.
The value could be productivity gains, cost-cutting, efficiencies in processes, reduced manual errors, etc. The prospects often provide detailed briefs about their pain points, problems or expectations, and you will need to provide comprehensive solutions that can help them.
You will also need to submit additional information like case studies, testimonials, compliance checks, etc., to establish credibility.
The outcomes of an excellently crafted proposal
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- It shows that you have clarity on the needs of your prospect.
A great sales proposal proves that you understand the prospects’ needs and industry and customized solutions to solve their specific problems.
- It shows that you have clarity on the needs of your prospect.
- Prospects are convinced that you are the best solution available.
When the challenges a prospect faces are clearly resolved through the solutions you offer, the prospects can clearly envision their future through the benefits offered in your sales proposal.
- They are inspired and compelled to take action.
A detailed proposal that includes clarity on budgets, solutions, expectations, and concrete action steps boosts the prospect’s confidence in your abilities, and they are compelled to take positive action.
The desired outcome of a proposal is to convert the prospect into a client. A winning sales proposal showcases the value of working with you and the benefits your solutions will bring to the prospect.
The 7 MUST-HAVES in a good sales proposal
#1 Detailed scope of work
The what? Describe the project in the language used in the client’s brief or request for proposal. Outline the responsibilities and expectations of both the client and the service provider. Bring clarity on any assumptions in the RFP, list exclusions and additional services.
#2 A quote for what you will provide
Itemized list of products, solutions, services, labor and price.Similar to a quote, but now this is a part of the bigger benefits you bring to the prospect.
#3 Describe the process
The how? What are the processes or the workflow you will follow? Set timelines, i.e. the when? List dates or milestones which serve as a tangible result of your services.
#4 Proof of prior performance
The why? Why are you the best? Include your credentials, case studies, testimonials, etc., to convey your capabilities to the prospect of having solved a similar problem before.
#5 The objectives, benefits and results
Focus on the client and their requirements and how you will solve them. Explain the solution, persuade with benefits and credibility, and sell by showing them how you will help them achieve their goals.
#6 Tell a story
Create a vision for the prospective client. The proposal should form a comprehensive picture in the mind of the prospect on the outcome and how you will get there.
#7 Build your brand
Maintain consistency in the look and feel of your sales proposal, include your company’s branding, logo and colors, keep it professional. A great way to do this is by using sales proposal software to generate professional proposals.
Conclusion
A sales quotation and a sales proposal serve very different purposes, so before you send either one to a prospect, clarify their expectations. Do they require a detailed proposal with a strong action plan or an itemized sales quote? Then respond accordingly. Invest in a good sales quotation and proposal software like VARStreet, and save time, eliminate errors, and deliver quotations and proposals that win you deals.
If you need help to enhance your processes, call us on 781-262-0610 or fill in this quick form, and we will get back to you to schedule a free demo.
