The success rate of sales proposals is frightening. Given the huge amount of time, energy and money that goes into their production – why is it 90% of sales proposals fail? Here are six areas to look at.
Pressure to win
The worst thing to happen in any sales campaign is to come second. You have all the costs of the sales campaign from beginning to end, but no revenue to offset against that.
In the case of a significant sales proposal like an IT outsource, it’s very easy for the presales costs of a bid to exceed £0.5m of which a big chunk is the cost of producing the sales proposal.
Coming second isn’t a story you want to explain to your management.
Start out by qualifying the sales opportunity – really qualifying it. There’s no point chasing a crock of gold at the end of a rainbow that isn’t there. And keep qualifying it throughout the sales campaign – client’s priorities change.
Make sure the value proposition is solid, built on facts (not guesses or assumptions) and the client agrees with it. Weak or woolly value propositions are a primary reason sales are lost.
The time and resources to create a winning sales proposal can be enormous.
By definition, that makes the activity visible. If the deal wasn’t visible to management previously for any reason, the action of creating a sales proposal will ensure it becomes very visible.
In most organisations that makes the sales opportunity the subject of a rigorous qualification process (or at the very least, some questioning about how you are going to win) to justify allocating resources to the project.
Don’t hide sales opportunities, whatever the reason. Use your organisation’s sales processes to get the resources you need to create a sales proposal that will win.
When you’re trying to get the resources you need to create a Bid Team, your organisation’s sales process becomes your best friend.
All companies creating sales proposals have internal processes to check what's going out the door. Very often these focus on the numbers and risks inherent in the sales proposal.
A side benefit of a good review process is it forces people outside of those directly involved to read the sales proposal – and comment on it.
That's valuable and should be used. It's a very common syndrome for the Bid Team to be too close to the trees to see the wood.
Lack of time
There is never enough time to create the perfect sales proposal. (And clients don’t help here – I can think of several times an RFP has been received mid-December with a response expected first week of January. Thank you so very much).
Time constraints often force a lack of planning and project management, leading to lots of use of previously generated boilerplate material just to be able to put a tick against a section.
I’ve seen many cases where the previous client’s name gets accidentally left in the text, or the spin put on the facts for the original client just doesn’t fit the current client.
Time constraints also often mean a lack of a comprehensive review before the sales proposal is issued.
If everybody’s up all night getting it finished for a 9am deadline, what chance is there for the whole thing to be studied thoroughly for adherence to theme, accuracy, spelling, grammar and consistency before it’s out the door?
Work with the Bid Team to develop a project plan and timeline to create the sales proposal.
On the face of it, planning the time should be straightforward. However there are two tripwires you need to think about:
- Review processes: Your own organisation’s ‘sales process’ will almost certainly mandate reviews at several stages in the creation of your sales proposal. Sometimes these are to a fixed calendar. Sometimes they need the involvement of busy senior executives. At the outset, you need to be clear who wants to review what, and when they can do that. Those reviews become milestones in your sales proposal’s project plan.
- Production: In formal procurement processes, very often clients will ask for multiple copies of your sales proposal in either hard copy or electronic format. Sometimes they mandate particular formats. One proposal I saw for a fairly straightforward service had to include ten hard copies for review. The resulting volume of sales proposal filled the back of a large estate car – and took over 24 hours to print and bind.
Problem: The skills required to create sales proposals don’t have the prominence of sales skills, and there isn’t as much published on the subject as you would expect.
Action: A small amount of training can make a big difference to help Bid Teams work cohesively to create better sales proposals. (And you could make a start by getting my ebook, “Sales Proposals that WIN!”)
Problem: In many sales organisations it’s unclear who owns the project of creating the sales proposal. Is it the role of the sales person, or the bid manager? Creating sales proposals is part skill and part process, and sales people are notorious for their adherence to processes.
Action: Most sales proposals are created by virtual teams that depend on effective leadership to function. Look at the roles and responsibilities in your own Bid Team to make sure the key roles are defined and allocated. When people know what is expected of them, there’s a much better chance everything will get done.
Nobody knows the client’s requirements better than the sales person. But that doesn’t mean the sales person won’t get subjected to a heap of well-meaning but often ill informed ‘advice’ from internal sources.
Knowing the client’s requirement and being able to describe the key issues the client needs addressing clearly and simply is fundamental to being able to keep the sales proposal focussed on the client’s needs rather than internal guesses, assumptions and perspectives (However well-meaning they might be).
Are your sales proposals winning?
How many more sales could you win if your sales proposals really worked for you?
Statistics show that around 90% of sales proposals don’t lead to a sale.
You can make your sales proposals more effective, more compelling and much more likely to win – get "Sales Proposals that WIN!".
- “Better sales qualification leads to accurate forecasting” to find out about Freedom2Act
- “Simple sales qualification tool” to get a free spreadsheet you can download to help you
If you’re interested in how this could help you, or feel I may be able to help you with some of the challenges you’re facing, please get in touch for an informal discussion.
There’s no commitment, we’ll just discuss your situation to see if working together might be a good fit.
Call me on +44 20 8133 7635 or +357 99 860725, or contact me.