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How To Price A Business Proposal?
How To Price A Business Proposal?
How To Price A Business Proposal?
How To Price A Business Proposal?
How To Price A Business Proposal?
How To Price A Business Proposal?

How To Price A Business Proposal?

One of the most important parts/aspects that service providers are often stuck with is their pricing model. Winning prospects and staying profitable is the key to a successful business journey. But what good does it bring if you lose money after providing great service? 

The bottom line is that you must learn to price your services as accurately as possible, and attractive, to win against competition. And here we present our blog that educates you to structure your proposal, give proper pricing options, and be profitable. 

When you first get on a sales call or send your business proposal, which page do you think your prospects might be interested to view first?

A study by HubSpot shows that nearly 60 percent of prospects want to talk about price in their first call, and so is the case in sales proposals. They always want to know more about the dollars, or the cents before saying or deciding for the service provider. 

So, the major challenge for your sales team is not to convince users to agree to the pricing terms, instead to make them believe in the price you quote and the services they get. 

How to develop a quote price for your proposal?

When creating pricing proposals, there are 2 ways you can get WRONG. 

  1. Pricing your business proposal fee too low. This way you may win more clients, but it won’t be necessarily profitable, help your business scale, or win quality leads. You will have less number of leads who will value your time and service and maintain sustainable relationships. 
  2. Pricing your business proposal fee too high. Here, you won’t get your prospect at all. And irrespective of how good your service may be, the prospects would hesitate to pay an amount that’s higher than the market value. 

These are the major reasons why you must be aware of your prospect’s budget and timeline before quoting a proposal fee. It also helps if you can judge your prospect in the first meeting like, how sustainable can the relation be, or what are their expectations, what are they expecting for a certain amount of price, etc. 

Proposal pricing examples

Do you keep your prospects on a retainer basis? Or do you charge per sprint? Or is your prospect comfortable with hourly or monthly rates? 

If you are a pro in your business, you might have heard of these 3 pricing models. And figuring which option your prospect might be comfortable with, you can provide a situation that’s a win for both. 

So, let’s dive in to see how you can make the most out of the 3 pricing models. 

Hourly or daily pricing

This is one of the most common pricing models followed by the service providers. 

You break down the project into milestones, calculate the amount of tasks that can be done in a few hours, set your prices, and charge hourly. 

When pricing your proposal, calculate the number of days you need to complete the project, and on an hourly basis suggest your price. If you are the only one working for the project, you can quote your price. But if you have a team working for the project, the prices may vary.

Suppose you have a team of 5 who will work on the project. Mid way, you might only need 3 of the team members, then the prices will vary again, and you can state this in the proposal, too. 

This approach provides a lot of flexibility, especially when you are freelancing your services. 

Agile methodology

Agile methodology is the process of breaking the project into smaller milestones, called sprints. Now, depending on the sprints, you can charge your prospects. This way the project is timely scoped, planned, and priced. 

Not only does this method avoid scope creep, but allows for changes to be made along the way, explains the time to be taken, and budget expectations. 

The best part about the agile method is that you get paid for every sprint and do not have to wait till the end of the month for your cheque. The prospects avail your services depending on the sprint, and both the parties can withdraw from the project if needed. 

Monthly retainers

In this method, you do a less of firefighting to get prospects on board. These are the prospects who need consistent help from you and believe in your services. 

Similar to the agile method, monthly retainers are also provided with milestones that hold you accountable to the timeline, and predict any changes that may be required to the prospect’s project. 

With retainers, you will have a consistent cash flow, build your business faster, and be secure. 

How to get your prospects to sign your pricing proposal?

Not all prospects you come across will have an open mind to hire services with high cost. In fact, most of them will lean towards the cost-conscious side. You can’t force the prospects to sign off the agreement, but can make sure that they at least change their minds before reaching the pricing page. 

So, here’s how you can make sure that the pricing proposal is,

  1. In line with your prospect’s expectations
  2. Is accurate based on the project details and requirement
  3. Gives the prospect flexibility and choice
  4. Outlines the efforts you and your team will put to get the results

Conduct a proposal discovery session

How would you feel if a salesperson, after his/her first call, sends you a pricing proposal? 

Weird, doubtful, and stupid, right?

Similarly, never send a proposal without letting the prospect know about it from the start. Make sure you have spoken to the prospect about the pricing prior to the date of sending the pricing proposal. The pricing proposal should not come as a shock to your prospect. And this the step where discovery is the key. 

A discovery session is a two-way communication that takes place between you and the prospect, but it has more for you. You need to identify and judge the prospect during the discovery call. Gather all intelligence about the prospect, their business, challenges, results, and open-mindedness. 

This way you can have a better and streamlined approach for your future plans, functionalities, design, interfaces, and prototype. After the plan is agreed upon, you can easily move to the next step of proposal estimate and expectations. 

The discovery step will give your prospect an option to understand the value of your services and process, and not just focus on the numbers and invoices. 

Involve your team in the project quoting sessions

Your team is your asset, and they are ones who would be completing the project. So, never sign for any agreement without consulting your team. Before finalizing the budget, timeline, and deliverables, make sure you take your team’s take on the project. So take inputs from the experts who can suggest plans to save time and complete the task in a much simpler way. 

Upon discussion with your team, you may discover certain aspects that need attention, or should be known by the prospect. So, make sure that you keep your prospect well-informed about these criteria, too. 

Give pricing options to your prospects

Everybody prefers options. But too many choices to make a person weak. Remember to give your prospects pricing options. It is never a viable choice if you give just one option to your prospect. Make your prospect feel the king of his/her choices. 

But avoid giving too many options. It’s considered best when only 2 or 3 pricing options are provided in the pricing proposal. The more number of choices, the prospects will not choose even one, in the fear of making a wrong decision. 

One way to simplify the process is to let your prospect know upfront about the 3 pricing options and details such as,

  1. What can be achieved as a minimal solution, an MSP
  2. What can be done with their budget
  3. What can be done more than their budget

You can present each of these options easily using a proposal software like yakkadraft where you can include pricing tables, to allow your prospects to easily view and choose prices from. 

Project the value you bring to your prospects

Pricing is a major part of maintaining a profitable business. But the factor which highly matters is the value to the price ratio. Draft a proper proposal highlighting the value they get from your services. To know more about how to draft a correct proposal, read the blog ‘How To Structure A Proposal.

While you price your services based on the hours that you would work for the prospects, highlighting the rewarding option with respect to the deliverables will always make your proposal look convincing. 

When your prospects discuss the prices, tell them more about the results, build awareness around your brand, and gain credibility. Position yourself as an agency that can bring value to their project with respect to the project prices. 


Pricing your services is a real challenge. Most of the service providers remain in a dilemma when it comes to prices. And thus, they either charge more or less, not adding value to their business growth. 

Research more on your pricing models, but looking at competitors and their charts. Set a price, but keep in mind the value you can put. 

Don’t be afraid to lose a lead. If you want to grow your business, the price also needs to grow. When you sell your services, not every prospect will convert. But make sure to leave a mark in their minds so that they can always come back to you. 

Maintain a positive word-of-mouth for your brand in the market!

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