Page 253 - Writing Winning Business Proposals

244 Appendix A

Others had remarked about the study needing to be thorough and convincing;
this was an additional reason why.
Gilmore asks Armstrong what deliverables he expects from the study.
Armstrong and his management team have given considerable thought to that
topic; indeed, the depth and diversity of their discussions convinced him they
would need outside assistance. He goes on to say that the team agreed that the
study would definitely have to answer at least the following questions:

◉ What will it take in terms of space, equipment, and manpower to meet both
the conservative and optimistic forecasts?
◉ How many of those resources can be provided by expanding the current
facility?
◉ Even if those resources can be added at the present location, does it make eco-
nomic sense to do that or to make the investment elsewhere?
◉ Can service levels be increased and transportation costs reduced at a new
geographic location to provide greater leverage in selling to mass-marketed
customers?
◉ What ROI will result from the substantial new investment?
◉ Which alternative generates the greatest profit during the forecast period?

Gilmore responds that these are important and realistic questions and that
in judging different alternatives, certain qualitative analyses also would have
to be made regarding labor supply, union climate, available technical train-
ing assistance, and the like. Armstrong acknowledges this and says he wants to
leave Gilmore with one additional point before they end their discussion. He
explains that even though they are seeing a shift in market demand away from
the Midwest, they have no intention of relocating the existing facility because of
its central geographic location and experienced workforce, the significant cost
involved in relocating many pieces of equipment and numerous personnel, and
the large “sunk cost” in land, building, and fixed equipment.
Gilmore says he appreciates that comment because in the back of his mind he had
considered these factors. He thanks Armstrong for his time and tells him that he can
probably have a proposal to him by the end of the following week. Armstrong instructs
him to send the proposal to Gupta, who is heading the selection committee.

February 15: Next Steps

When he returns to the office the following day, Gilmore meets with you to brief
you on his second visit to ABC. Gilmore wants you to spearhead the preparation
of the proposal, which he will help you with as time is available.