Value-Based Fees Proposal Template

Situation Appraisal

[2 or 3 paragraphs of the client's current condition and why the proposal has been sought. Should reflect what the buyer and I have already discussed and be focused on the problem that my work will improve. Avoid restating the obvious.]

Objectives

[Bullet point objectives derived from the conceptual agreement obtained in preliminary discussions. Ex:

  • Dramatic reduction in A

  • Significant increase in B

  • XX% improvement in C

]

Measures of Success

[Based on the conceptual agreement. Hint: that means the conceptual agreement should include discussion of these things! Ex:

Our metrics will include:

  • Monthly reports of X

  • Measurements of Y

]

Value to the Organization

[This must also be a reiteration of what was conceptually agreed to in previous discussions. Ex:

The value to OrgName will include:

  • Increased profitability in the XYZ product line

  • Reduced customer complaints

  • Increased …

]

Methodology and Options

[Briefly discuss—without going into implementation details—the options or the choice of yesses available to the client. Make sure the smallest option satisfies the objectives above and the bigger ones just pile on more value. Ex:

Option 1:

Prose description of what will happen. Ex: Create email educational campaign, deliver, monitor results.

Option 2: This includes Option 1, but we will also ABC…

Option 3: This includes Options 1 & 2, but we will also XYZ…

Options should not just be "more of the same" (interview 10 customers instead of 5), but should include new & different ways of producing value.

Try to create 3 or 4 options.

]

Timing

[State clearly, using calendar dates—not relative dates—when the project can begin and the likely range of its duration. Don't commit to a firm ending date. Educate the buyer that there's a reasonable range, but it's based on access, cooperation, unforeseen events, and so on.

]

Joint Accountabilities

[

This is not something "I do for the client", but a collaboration between peers.

Ex:

My accountability includes:

  • A

  • B

  • C

Your accountability includes:

  • C

  • D

  • E

Our joint accountabilities include the following:

  • X

  • Y

  • Z

]

Terms and Conditions

[This is the first time the buyer sees the fees. Hopefully, the buyer is nodding "yes" to everything up to this point. Through sheer momentum, the buyer should continue to nod "yes" to the fee information revealed here. Ex:

Fees

  • The fee for Option 1 is $xx,000

  • The fee for Option 2 is $yy,000

  • And so on…

Payment Terms

  • A 50% deposit is required to commence work, with the balance due in…

Discounts

  • A 10% discount is provided for a single, full-fee payment at the commencement of work

  • Expense reimbursement terms

  • Your deposit, in the absence of your signature below, also will indicate acceptance of this project and the terms and conditions as stated herein

]

Acceptance

[Signature blocks. Mine will be executed when I send the proposal. Send two hard copies (one to keep, one to return) via overnight Fedex. Ex:

Your signature below indicates acceptance of the terms of this proposal indicated by the option you have checked:

___ Option 1

___ Option 2

___ Option 3

We accept eh proposal above and the option selected.

Signature blocks here.

]

Followup instructions

  1. Call the buyer at the time you arranged when you promised the proposal to them.

  2. Just say you're calling as promised and let the buyer state their position.

  3. If positive, establish a start date.

  4. If not, clarify, deal with reservations, accentuate value, avoid lowering fees without also removing value.

  5. If the answer is no, find out why. Rebutt objections, or learn and move on.