A business plan and a proposal are two different kinds of documents that are used for different things. A business plan is a document that explains how a business plans to reach its goals and objectives. A business proposal, on the other hand, is a sales document that a business uses to ask a client for a contract.
Business Proposal vs. Business Plan
A business plan and a business proposal are not the same. They have different goals, styles of writing, and ways of putting things together. The main difference between the two is that a business plan is a document that gives facts, while a business proposal is a request for a deal and a price quote.
A Business Plan
You can think of a business plan as a written record of the company's long-term goals. Plans for a business are by nature tactical. It's like saying where and when you want to start, when you want to get to the next point of view, and how you plan to get there.
A business plan explains how the business is supposed to run, what its financial goals are, who it might be competing with, its marketing strategy, executive summary, and other things that affect how the business is supposed to grow.
A business plan is one of the best ways to get investors interested in a company, especially a new company that hasn't yet made a name for itself in its field.
A business plan can also help professionals like lawyers, accountants, and potential employees understand what a company needs from them. A business plan clearly lays out the scope of the business, which helps you think more clearly as a business owner.
The business plan should be made with honesty because it shows what the company wants to do. It shows whether or not the company's business goals are likely to be reached.
Experts say that it would take about six weeks of thorough research and planning to make a good business plan. So, you can't usually make a good business plan in one day, show it to potential investors the next day, and get the results you want.
A business proposal goes straight from an established business to a possible client. It is an attempt to sell a service or product from a business to a client, not the business itself. A business proposal is also not a quote.
Even though the business proposal will include costs and other details, an estimate is a lot less official and is just a way to skim over the costs. It does not tell the whole story.
In general, business proposals show an idea, like a new, profitable project. The goal of the proposal is to get investors to back the business idea being suggested.
For example, a well-known chain of restaurants may want to expand into a nearby state. Such a restaurant would have to write a business plan to get the money it needs from its potential investors.
Even though the business proposal is similar to a business plan in that it gives an overview of what the company does, its main goal is to give details about the proposed business idea, including answers to any questions that investors might have. You can check this project proposal template to see what is included in a business proposal.
What's in a Business Plan?
A business plan has three main parts: a description of the business model, sales strategies, and financial goals. But it has more detailed information in the following sections:
What the goods and services are and what they do
Analysis of the market (analysis of possible business rivalry)
Marketing strategy Operating plan
How leaders are put together
Getting started with management
Financial goals (deliberations on monetary concerns, and how to address them and achieve expected results).
Solicited Business Proposals vs. Unsolicited Business Proposals
When responding to a request for proposal (RFP), a business proposal that was asked for should be in the format that the client asked for in their RFP.
A business proposal that was not asked for could use the same format or it could use a different one. Its goal is to come up with and build a business idea. Because of this, it's best to use the same format or another well-known format in the field.
When a business receives an unsolicited business proposal, it can choose the structure it thinks is best. No matter what format is used, though, the proposal should be up to industry standards. For example, it should focus on important topics, be well-researched, offer something of value, and have a call to action.