Page 223 - Writing Winning Business Proposals

214 Writing Winning Business Proposals

you might want to put protective terms in your proposal offering, or even
increase your fees to protect your firm. Similarly, if my issue/question is one that
is not very clear to you—that is, the baseline logic and/or benefits are difficult to
define—you might want to reflect that condition by increasing your fees or even
declining to bid. If the project becomes a disaster, no pricing level, no matter how
high, will protect your firm’s reputation.
You could regret not conducting an overall risk assessment, especially if
answering our overriding question might result in negative publicity or if our
desire for a quick return on our investment results in a “pay as you go” arrange-
ment that will be difficult for you to produce. You also should think long and
hard about your pricing strategy and about whether to pursue an opportunity
when the project’s issue is not a top-management priority.
Previously, I mentioned the risk of your selling too low in the organization.
Now, I’m talking about a different situation, one in which individuals are at an
appropriate organizational level and have the budgetary authority to hire you but
do not place a high priority on the issue to be addressed by the project, especially
if the project’s results will not help our organization achieve its strategic direc-
tion. If my firm’s management does not believe the issue is important, you could
very well sell a project that was doomed to fail.
In this situation, you could choose to increase your fees, hoping to convince
management of the issue’s importance. Or you could increase your fees dramati-
cally so that I am more likely to decline your bid. In this instance, you are using
your pricing strategy to encourage me to say “No” so that you yourself are not
declining to bid. If I say “Yes,” you will have a built-in cushion to offset the risks.

How risky is the proposed project?
How risky is the proposed project?
• Do I and my colleagues fully understand what we need to do to ensure a
• Do I and my colleagues fully understand what we need to do to ensure a
successful project?
successful project?
• Do you, I, and my colleagues agree on the benefits that will accrue?
• Do you, I, and my colleagues agree on the benefits that will accrue?
• Is this project a top priority for me and my firm’s top management?
• Is this project a top priority for me and my firm’s top management?
• Do I and my colleagues desire a quick return so that the project can be "pay as
• Do I and my colleagues desire a quick return so that the project can be "pay as
you go"?
you go"?
• Are my firm’s financial profile and credit in good standing?
• Are my firm’s financial profile and credit in good standing?
• Might this project be seen as a conflict of interest by your other clients?
• Might this project be seen as a conflict of interest by your other clients?
• Could this project generate negative publicity for you?
• Could this project generate negative publicity for you?
FIGURE 13.4 Pricing strategy related to riskk
FIG U RE 1 3. 4 P ricing stra t egy r e l ate d t o ris