Business Plan or Business Proposal? Know the Difference
Do you know the difference between a business plan and a business proposal? These are two very different business documents, each serving a distinct purpose. Be sure you're using the correct type of document to get the results you want.
Business Plans
A Business Plan is a document that describes in detail how your business is set up. Business plans cover your business structure, your products and services, your market research and marketing strategy, and your complete budget and financial projections for up to five years. Both startups and existing businesses require business plans. Developing these documents requires a lot of research and number-crunching.
You need a business plan for two primary reasons. First, spending the time to do this work clarifies your thinking, provides you with information previously not considered, and gives you a workable strategy to follow for the period covered by the plan. Your business plan is your blueprint to success -- it outlines the steps to move from business idea to business success. And if your research reveals that your idea isn't destined for success, then better to know it now then a year from now when you have lost thousands of dollars. You can spend your time planning another idea that could have a better future.
Secondly, if you are hoping to raise funds through a business loan, a venture capitalist, an angel or an incubator, don't even consider approaching these moneylenders unless you have a thoroughly researched business plan in your hand. Experts estimate that it takes approximately six weeks to develop a business plan, so whipping one up the day before your appointment with the banker won't work.
Business Proposals
A business proposal is a document that you submit to another enterprise proposing a business arrangement.
There are two main categories of business proposals: invited and non-invited.
As an example of an invited proposal, government and large corporations wanting to purchase services or products from private suppliers often post public tenders inviting contractors to bid. You will be competing against all bidders that noticed the posting and responded. Similarly, some businesses will send Requests for Proposals (RFPs) to a selection of businesses that they are willing to consider as a potential supplier. In this case, you will be competing against perhaps five businesses that the client has already handpicked as suitable.
Both of these examples require a business proposal. In some cases, the client will provide a Bidder's Document that stipulates the style of proposal that they want to receive and the categories of information to be covered. If no Bidder's Document is available, the style and categories of the proposal will be up to you to decide.
If you are responding to an RFP or a call for tender, you will know that the service/product is wanted, but you will be competing against the other people who bid. You must sell your company as the best possible choice of all the bidders.
In a non-invited proposal, you might have an idea for a product or service that would be of benefit to Company X. You submit a proposal to Company X suggesting that you provide this service or develop this product in exchange for funding or some other consideration. Although the nature of the proposal could differ from the example given, essentially you are proposing some type of business relationship (something more complex than let's exchange weblinks ).
In this case, you don't know if the company is open to your proposal or whether they will like your proposed idea. However, if they do like the idea, you won't be competing against numerous other bidders. Your proposal has to sell not only your concept but also your company. It must convince the client that not only is the service/product potentially valuable to them, but you and your company are credible and stable.
Whether invited or non-invited, your proposal must be well researched, well written and contain a reasonable budget. Spend time on this document and you'll be ahead of the people who threw something together on the bus riding to work
FREE GIFT when you visit June Campbell on the web. Also information about writing business proposals, joint venture contracts, business plans and more? Visit June Campbell's business resource site.
Nightcats Multimedia Productions: http://www.nightcats.com/
| DISCLAIMER: The content provided in this article is not warranted or guaranteed by Developer Shed, Inc. The content provided is intended for entertainment and/or educational purposes in order to introduce to the reader key ideas, concepts, and/or product reviews. As such it is incumbent upon the reader to employ real-world tactics for security and implementation of best practices. We are not liable for any negative consequences that may result from implementing any information covered in our articles or tutorials. If this is a hardware review, it is not recommended to open and/or modify your hardware. |
More Online Business Help Articles
More By Developer Shed
 developerWorks - FREE Tools!
|
Hold your calendar on January 30, 2008 for this free webcast on the new i5/OS. Rational's Enterprise Modernization products will be discussed at this webcast as they help to drive the application development environment for this new System i OS. <br />And learn how i5/OS will take you to the next step of efficient, resilient business processing. You will hear about the new i5/OS capabilities as it will be the most significant i5/OS release in years. If you cannot join the webcast on 1/30/08 you can still use this link to listen to the replay.<br />
FREE! Go There Now!
|
|
|
|
Attend this launch webcast with Scott Hebner, Vice President of IBM Rational Marketing and Strategy, for an overview of Rational’s new software offerings and resources to help modernize and accelerate software innovation on i on Power Systems – while ensuring past application investments are protected and continue to grow. Learn how these solutions are helping customers extend their core i5/OS solutions toward modern architectures such as SOA and web technologies to deliver business improvements that stand the test of time.
FREE! Go There Now!
|
|
|
|
Effective governance for lean development isn’t about command and control. Instead, the focus is on enabling the right behaviors and practices through collaborative and supportive techniques. Hear from Scott Ambler on how it is far more effective to motivate people to do the right thing than it is to force them to do so. Learn how to form a lightweight, collaboration-based framework that reflects the realities of modern IT organizations.
FREE! Go There Now!
|
|
|
|
This whitepaper presents the benefits of successfully introducing static analysis into your organization using IBM Rational Software Analyzer. Additionally, it identifies some common pitfalls that can hinder the effective use of static analysis tooling as well as presents 10 simple strategies designed to help you quickly realize the value of static analysis using Rational Software Analyzer.
FREE! Go There Now!
|
|
|
|
Download a free trial version of IBM DB2 9.5 for Linux, UNIX, and Windows. DB2 9 is the result of a five-year development project that transformed traditional (static) database technology into an interactive data server that merges the high performance and ease of use of DB2 with the self-describing benefits of XML.
FREE! Go There Now!
|
|
|
|
Rational Modeling Extension for Microsoft .NET enhances usability for code generation supporting a more intelligent refactoring. The latest enhancements enable organizations with Java and .NET systems and software development maintain architectural integrity across heterogeneous platforms.
FREE! Go There Now!
|
|
|
|
Learn the basics of the IBM Customer Information Control System (CICS). With a hands-on exercise, learn how to get your first CICS application up and running on your desktop using TXSeries V6.1 for Windows. The tutorial shows you how to download and install a free trial version of TXSeries V6.1.
FREE! Go There Now!
|
|
|
|
Because access to government information continues to be an area of concern for many U.S. citizens with disabilities, the U.S. government enacted Section 508 of the Rehabilitation Act in 2001 to ensure that government agencies create accessible Web content, enabling all citizens to access the information they need. A fully accessible Web site makes Web content accessible to all individuals, including those with disabilities, who may be accessing Web content via a variety of user agents. Common user agents include standard Web browsers, text-only browsers, assistive devices and mobile devices such as cell phones or personal digital assistants (PDAs).
FREE! Go There Now!
|
|
|
|
This paper is about the critical role that a discipline called integrated requirements management can play in helping to ensure that your business goals and IT investments are continuously aligned—whether you are sourcing, integrating, building or maintaining software. It also looks at ways that automated IBM Rational® products can work together to help you use requirements in the very best way.
FREE! Go There Now!
|
|
|
|
The discipline of assembling and delivering software is maturing beyond standard developer-centric compile/test software builds. The end-to-end software development lifecycle is emerging as the new focus moves “Beyond the Build.” Join this on demand webcast to learn about methods for streamlining software delivery and key capabilities of the IBM Rational Build Forge framework for automating build and release management in environments of any size.
FREE! Go There Now!
|
|
|
|
All FREE IBM® developerWorks Tools!
|
/ 3 
