The Gospel

A proposal is a summation (of conceptual agreement), not an

exploration (of a relationship).


The Nine Components
My proposals are all about two and a half pages and have nine components.
That s it. There are no resumes, company histories, or obsequious love notes to
the buyer.

We cover the peripherals and what s not included in the next segment,
but for now, let s focus on the heart and soul of a proposal that will usually
be accepted by an economic buyer. 2 You can fi nd proposal examples in the
Physical Appendix and the Virtual Appendix.
1. Situation Appraisal
This is a brief (one - or two - paragraph) description of what the issues are that
prompted you to discuss this project and reach the agreements and conclusions
that follow. The intent is to cause the buyer to nod in agreement, Yes, that s
what we discussed, right from the outset.
A poor situation appraisal: Acme is a company that sells explosive devices
to predators in order to facilitate the capture of wild prey. This is useless.
Acme already knows that!
A good situation appraisal: Acme s position in the provision of explosive
devices for wild prey has become endangered by the reliance for 90 percent
of its business on a single customer, a coyote with no permanent address.
Or: Acme wishes to expand its market penetration from the American
West to the savannah of Africa, expanding from coyotes to lions.
Note that situation appraisals can refl ect either a problem to be solved or
an opportunity to be gained.
2. Objectives
This is the start (#2 to #4) of a repeat of the conceptual agreement already
achieved. I prefer bullet points.
Our objectives for this project include the following, as we ve discussed:
Expansion to occur within 18 months.
Use of internal resources only no subcontractors overseas.
[and so on]
3. Measures of Success
Same format:
Our measures of success, previously agreed upon, include:
Monthly sales reports indicate growing percentage of foreign sales.
No net increases in employment on monthly payroll.
[and so on]
4. Value
Same format:
The value we discussed that will accrue from meeting the objectives
include:
Diverse customer base to help offset domestic economic fl uctuations.
Attracting more investors and increased stock price with global presence.
[and so on]
5. Methodology and Options
Here we list the choice of yeses for the buyer, who has not seen them in detail
before (you may have generally discussed them). You do not cite fees here.
Option 1: We will conduct a study of the highest - potential, most lucrative,
and easiest markets to enter and will create a strategy and tactics
for the top fi ve choices.
Option 2: In addition to option 1, we will develop introductions with
the key governmental, trade, banking, and political fi gures to accelerate
speed of entry [and so on].
Option 3: In addition to option 2, we will serve on retainer for up to one
year to be your sounding board and fi ne - tune the implementation in
the longer term.
Note that options escalate, and that each new one embraces the preceding
one(s). These are not add - ons or phases of the project.
6. Timing
The client deserves to know the extent of the disruption, change, and
interventions, and also when you will disengage. (This is consulting, not
codependency.)
Thus: For option 1 the timing will be 30 to 45 days; for option 2, 45
to 90 days; for option 3, 90 days up to a year, depending on the extent of the
retainer.
7. Joint Accountabilities
Since this is a partnership, not something you do to the client, you have both
separate and joint accountabilities. Here are generic examples:
Our accountabilities include:
Signing nondisclosure agreements.
Monthly or more frequent debriefs as requested.
Response to questions within 24 hours.
Your accountabilities include:
Personal e - mail and cell phone access and 24 - hour response.
Documentation for employees and clients as needed.
Security clearances, company IDs, offi ce in headquarters.

We jointly agree:
To immediately inform the other if any situations develop that could
materially affect the outcomes and success of this project.
This last category is included because I ve found myself knee - deep in
a project when the buyer announces that there is a divestiture or acquisition
and I couldn t be told earlier because the deal was pending. That s
unacceptable, and places you in the position of possibly lying to company
employees.
8. Terms and Conditions
My favorite part of the proposal: This is the fi rst time the buyer sees the fees.
It s very simple:
The fee for option 1 is $ 65,000.
The fee for option 2 is $ 98,000.
The fee for option 3 is $ 35,000 per quarter.
Fifty percent of the fee for option 1 or 2 is due on acceptance, with the
balance due in 45 days. Alternatively, we offer a 10 percent professional discount
when the full fee is paid on acceptance. Fees for option 3 are due on the
fi rst day of each quarter of the retainer.
Expenses are billed monthly as actually accrued, and are due upon presentation
of our invoice. We charge for reasonable travel, lodging, tips, and
meals. We do not charge for copying, courier, administrative work, phone, or
other communications.
It s important to let the buyer know you are not nickel - and- diming like an
attorney (for an attorney s bill of $ 4,517.44, $ 17 is for copying and $ .44 is for a
stamp). It s also important to charge reasonably; that is, you re free to stay at the
Four Seasons, but you should charge your client only Marriott rates. I fl y fi rst
class all the time. I charge domestic clients unrestricted coach fares and charge
international clients unrestricted business - class fares, and I pay the difference.
You should have your fees paid quickly, never stretched out and never at
the conclusion of a project. And then this:
The quality of our work is guaranteed. If we do not meet your
objective within these time frames and that fault is ours, we will refund
your full fees. However, otherwise this contract is noncancelable for
any reason, though you may postpone and reschedule. The original
payment dates must be met.

The quid pro quo is that you ll guarantee your quality (but never results,
which are subject to far too many variables you can t control), but the contract
is noncancelable for any reason .
9. Acceptance
My proposals also serve as a contract, since I don t want a formal contract going
to the client s legal department, where people are paid to obfuscate and delay.
Here are the words:
Your choice of an option below and your payment constitute acceptance
of the terms and conditions herein. In lieu of your signature,
we will proceed solely on the basis of your payment.
The rationale here is that many buyers can authorize six - fi gure checks,
but can t sign contracts without legal department scrutiny. 3 Thus, an oral yes
and a check will make me a working consultant.