Management Notes

Reference Notes for Management

Business Proposal -Types of proposal | Business Communication

Business Proposal

The proposal is a detailed plan submitted for approval to some organization or a person in a position of authority that seeks to persuade them toward action. A proposal puts the buyer’s requirements in a context that favors the seller’s products and services, and educates the buyer about the capabilities of the seller in satisfying their needs.No matter how long or short, a proposal must be highly persuasive to be successful. Even if you are looking forward to start a small business, you need a strong proposal to persuade your investors to invest money in your business.

There are mainly four types of proposals which are as follows.

Types of proposal

  1. Solicited and Unsolicited Proposals
  2. Informal and Formal Proposals
  3. Internal and External Proposals
  4. Grant Proposals

a) Solicited and Unsolicited Proposals

Solicited proposal

These proposals are written in response to published requirements, contained in a request for proposal (RFP), request for quotation (RFQ), an invitation for bid (IFB), or a request for information (RFI).RFPs provide detailed specifications of what the customer wants to buy and sometimes include directions for preparing the proposal, as well as evaluation criteria the customer will use to evaluate offers.

Customers issue RFQs when they want to buy large amounts of a commodity and price is not the only issue—for example when availability or delivery or service are considerations. Customers issue IFBs when they are buying some service, such as construction. The purpose of the RFI is to gain “marketing intelligence” about what products, services, and vendors are available.

Unsolicited Proposal

These proposals are the business proposal we submit without their request for a proposal. They are initiated by an organization that seeks to make a change or obtain funding. They try to convince the audience that the change or funding is in the best interest of both sides.

b) Informal and Formal Proposals

Informal proposal

These are the type of proposals that give a brief description of suggestions and recommendations which are short and concern small projects and produced usually in the form of memos or letters. Their tone and language are relaxed, and they may use the first person and contractions.

Formal Proposal

These are the type of proposals that are longer and they concern large projects. They are detailed and comprehensive and follow an elaborate format with several sections.

c) Internal and External Proposals

Internal proposal

These are the type of proposals that are used for persuasion within an organization ie; used for request or implement change, and cover almost every activity or policy inside a firm such as reorganizing departments, expanding facilities, reducing budgets, and improving procedures.

External proposal

These are the type of proposals often written to audiences outside the organization which could be in response to RFP(Request for proposals) and may include an executive summary. They are more detailed,well-designed, and go on extra length to persuade and convince the reader.

d) Grant Proposals

Grant proposals are the type of external proposal submitted to a government or civilian entity that outlines a proposed project and shows budgetary requirements and requests monetary assistance in the form of a grant. It begins with an introduction, followed by the scope of the problem or topic, methods or procedures, timetable, and request for approval.


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3 thoughts on “Business Proposal -Types of proposal | Business Communication”

  1. Hi there! This post could not be written any better! Reading through this post reminds me of my good old room mate! He always kept talking about this. I will forward this page to him. Fairly certain he will have a good read. Thank you for sharing!


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