Stop the insanity!!! – Why you should never do a free proposal again…

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Have you ever tried not doing that? If not, keep reading…

    * Do you ever feel like you waste so much time and money chasing down new business just so you can keep your bills paid and staff busy?
    * Do you ever feel frustrated doing bids, RFP’s, RFQ’s, or RF-Whatevers?

I can remember the early days as an entrepreneur back in 1999 like it was yesterday. I started out thinking that all you needed to do is pick-up the phone and jam away. Get in front of as many people as you can, and give them your “pitch” until someone surprised you and said yes? That 20 year kid that had passion was surprised to find people “saying yes so soon”. That was the good side of it. The bad side of it was it didn’t take too long for me to find out that I needed a more formal proposal process to get larger jobs or to “seem more professional”. That being said, I found myself doing what everyone else did. Meeting with people for free, and then coming back as quick as they allowed me to “give them my free consulting” that they wanted to steal from me. Then they would hide and I would chase. It was a vicious, insane cycle. That is just how it is with sales right? Sales people for decades have trained prospects to think like that and it is still like that today. If you are in business tomorrow I am sure it will be no different J I found as my business grew that I built a larger and larger staff and we did more and more proposals. I started building a sales and support staff of 5 (who I outsold collectively sadly enough) and we cranked out our 150+ proposals a year. They were really just boiler plate price confirmations or even worse they had free creative/technical planning ideas presented…most that would never been executed by my team after my prospects stole our wisdom.

I was then challenged by some of my wise coaches, Ed Staub of Staub an Associates and Dan Sullivan’s coaches with The Strategic Coach®. I can’t praise them enough. They told me if you keep doing the same thing and expect different results you are operating in the definition of “insanity”. It registered with my heart, and I wanted to know how I could go about it a different way and actually do the unthinkable – charge for doing a proposal!

I had all of the same fears and questions that any entrepreneur, salesperson or leader would have. That is how everyone does it in our industry! That is how we have done it for 30 years! What about push-back and rejection from clients and prospects? What if our sales plummet drastically because of the shift? Maybe in a strong market it could work but it can’t work in today’s rough economy? Most of my staff was even resistant to this so much that it created tension and some quit, and some I let go. One strategic by-product from having the courage to face this problem, was that I found out I had some of the wrong people on the bus, and it gave me clarity to take action on it. More on that in a later blog post.

The funniest fear of all that I remember is asking one of my coaches at the time with Staub & Associates, named Doug, “what do I do if it works the first time?”. Did I really ask that silly question? Sadly yes. The funny thing was as I drove down to a prospect in Columbia, Maryland one day going in and I was going to do the unthinkable – charge $1,000 to do what they viewed as a proposal. It is truly much more involved and is not a proposal, and is a discovery plan in my mind, though we can talk about that as well another day. It is definitely packaged ideas and wisdom anyway you look at it. They didn’t know I was going to charge them. Only my coaches, and I knew. I almost talked myself out of it, but somehow I got it out with my voice clearly changing several times I am sure like a young man going through puberty. The hilarious part of it is they said “yes”. What? You got it. Now what I do I thought? Well I took my simple 1 page signoff with me and their check and asked my CFO to see if the check cleared and did the same work I was doing before for free J I have charged exponentially more since and $1000 isn’t even my minimum anymore if you believe that. People are glad to pay it when it is really a mutually fit.

After I realized this was the truth, and started seeing many others say yes at an alarming rate I vowed I’d never do a free proposal again. Thank God for that! Doing free proposals serious is NUTS! I just wanted to cut out the quagmire of doing 150+ proposals. After you calculate the lost sales and staff time to produce them it is really alarming how much money you are wasting that should be profit. I was down to doing 30-50 proposals a year for clients that were paying us for all projects small to large. I was able to even see how a firm of about 1/3 less staff size could do a better job creating more value and individualized attention for each of my clients with their project so it was truly win-win for my clients and firm. We watched revenues increase notably and ensured that we never did a free proposal ever again while getting paid for everything we did. More on that as well in a later post.

There really is so much more to effectively improving your sales process for your business than charging for proposals, though it is one major key to moving in the right direction. You also need to come up with a fine tuned sales and discovery process that looks at the overall big picture on everything. You also need to look at how your behaviors and attitude needs to change on a daily basis. You need to look at how you spend your time and how you can be more accountable. You need to package your wisdom and create a unique proposal process more sophisticated than simple paper and numbers like your competition.

I help my coaching clients focus on matters like this so they can see their business become more efficient, profitable and scalable if desired. If you want to find out more about how this could be leveraged in your world, feel free to contact me personally or call me at: 717-615-2274. Feel free to share this article and my blog; that has all of my life/business coaching resources on it: visionandpassion.wordpress.com; with those you care about in your circle of influence if you feel they might benefit from this article. If they want to join my blog or receive this article as a PDF, then have them contact me as well.

In closing, I have news for everyone reading this. It is a shocker. All of this crazy charging for proposals stuff really DOES work TODAY for ME even in this down economy J We stand out more today than ever before in truth so it adds to the market differentiation for my firm as well. I am not the only one. I was just brave enough to believe that I could succeed like others that encouraged and led the way before me. I desire for you to be encouraged and inspired to believe that you can do this for your business as well. I pray it impacts your business and financial outlook in notable ways that spur you as time rolls on. If you want to keep doing it the old way then more power to you, but I prefer spending the most precious resource in life: “time” doing things that I believe make more sense personally.

God bless,
Joe