We have heard of proposals. Some business owners and companies use them. Some do not. Either way, a proposal can save a relationship with a client. It makes a verbal agreement concrete. How many times have we shaken hands with someone in a deal only to find that the terms of the handshake changed without the other “shaker” knowing it?
Some business owners I speak with do not use proposals, because they charge a low price on a specific service while they use a proposal for the larger deals. I find this to be a mistake. Even the smallest deals with the lowest price tags can go sour because of a disagreement or a misunderstanding. Mitigating a misunderstanding is the most important reason to draw up a proposal and sign it with your client. In my business, whether I charge $100 for a simple change or edit on someone’s website or a full blown project costing $50,000, I still use a proposal. There are not only misunderstandings with a handshake or a verbal agreement, but one of the parties can be dishonest and change the terms willingly disguising it as a misunderstanding.
A proposal puts everything in writing. It lays out the number of hours, prices, services performed, and the deadline. I have learned my lesson the hard way that not specifying these items in a proposal can cause me to lose the sale or worse, I perform the work and the client wants a refund, because I did not perform the work the client’s expectations which could have been avoided with a simple proposal. One project I had, for example, the client wanted an entire piece of software developed even when he signed the proposal and I refused to build it without additional funding since it was never in the proposal. Therefore, a proposal can also be your business bible. It helps you read the client’s mind and vice versa. Without a proposal, you cannot read a client’s mind. At least, the client can question the absence of the feature before signing the deal.
The bottom line is that if you are a service-oriented company, it is best never to accept another project from any client (even existing clients) without at least a simple proposal, but the more complex the proposal, the better you are protected from misunderstandings.
