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Friday, February 28, 2014

Sample Price Proposal and Quotation Letter


Sample Price Proposal and Quotation Letter

Dear Mr. Augustine,

Thank you for allowing us the opportunity to bid on the Marina Reservoir. We are willing to enter into a 6-year contract, but reserve the right to review the pricing structure after 3 years.

We are pleased to submit the following bid quotation:

• Breakwater Barriers - $130,000,000
• Installation of Concrete Fixtures- $20,000,000
• Quality Maintenance and Standards Upkeep (6 years)- $20,000,000

These quotation prices are for services and construction pre-fabs delivered in accordance with the project's timetable. Plus any state applicable taxes are included in our pricing proposal.

All future prices will be those in effect the day of shipment, Free on Board destination. Our credit terms are 60% percent upon execution of contract and 40% percent upon delivery.

Please feel to get in touch with me at 555-7868 about any of the specifics of this quotation. Again, thank you for considering Amsted Associates for your largescale development projects.

Best Regards,
Marc Reynolds 


How To Write A Successful Tender, Proposal or Quotation

Do you know why proposals fail? It’s simple. If you are like most businesses, your proposals probably look like everyone else’s and they usually focus on the price. If you spend valuable time presenting your proposals in this way, it will mean one of two things:

·      It will look so boring it might not even be read, or
·      The reader will just skip down to the price and compare yours with their other quotes
And probably, at that point, opt for the cheapest.
That’s not what you want. You need your proposal to be a successful sales letter, not a price list.

Write a Letter Not an Invoice

If you make your proposal look and read like a letter instead of an invoice, you have more chance of drawing your reader in to see why your services or products are worth the money.
Experts agree that there is an easy-to-follow format to writing a proposal that has more chance of success than what you are probably doing at the moment.

Make your proposal follow this order:

1. Remind them why you are writing – a general statement on what you are offering. This will jog their memory and continue their relationship with you.
For example:
Dear Mr Smith

Thank you for speaking with me over the telephone last week.  I now have a much better understanding of what the Council requires and understand the current constraints and reasons you are wanting to purchase a park mower that is better suited to handle the work more efficiently.
2. Recap on what’s been discussed so far – this is a very important sales point in your letter. Tell them what they have told you. Your client must be sure you understand exactly what they have asked you to do. Highlight the main points.
For example:
As you explained to me, the main area to be maintained by the new mower is one park and two ovals which totals around 10-12 Ha in area.  These areas are currently being maintained by the council’s slasher and out front mower.  I certainly agree with you that using a mower with twice the current cutting width will greatly improve the Council’s efficiency!

As the manufacturer of the Olympic Park Mower, we can customise the mower to suit your conditions and ensure what you purchase is an efficient, economic and very effective unit.  From our discussions I have noted some of your specific requirements and have included these in the pricing.  
3. The Price – By this time your client should be confident in your products or services. Tell them what the price is, but don’t make it stand out like a sore thumb. Most proposals or quotations do this by underlining or bolding the price, or by placing it as the last item on the bottom of the page. You do not want to build them up and them hit them with a nasty price at the end.
Your price should sound like an investment not a cost; one which is obviously going to benefit their organisation.
Give the total amount first, then, break it down if necessary, or outline the benefits that are contained in that price.
For example:
The total investment for your Olympic Park Mower is only $13,090.  Let me define what is included:
List all points to reiterate the benefits that they will receive, whether it is product features, or services rendered.
4. You have exactly what they need – this is where you tell them that you have exactly what it is they need and what they are looking for. You can add a list of services or product details here. Make it very much ‘what you get out of it ‘ focussed.
  • The model will be a TM371 Park Mower.  This unit is very similar to the one displayed at the recent Council field day at Make Believe Farm.  As you and your staff expressed, it is a very robust, very simple and very capable unit.
  • Your mower will be set up with a large diameter front roller. This allows the mower to safely follow the contour of the ground, even in semi rough conditions.
  • The rear of the mower will be fitted with a roller spanning the width of the main deck.  This will also help follow the contour and help keep the ground flat – especially in the wet. (Of course, if you decide to change the rear roller specification to two solid rubber tyres we can accommodate your request with no change to the price.)
  • Cutting height of the whole mower is easily adjusted with just three turnbuckle assemblies – no more bolts to undo or holes to line up. 
  • We will have the cutter beams manufactured to allow you to change between 4mm thick finishing tip blades and 7mm thick pasture slasher blades.  This will give you an even more versatile mower than ever before.
  • The TM371 has five oil bath sealed spindle units, all identical and all with a four groove cast iron pulley.  Each pulley is locked onto the spindle with a tapered spline.
  • Having each spindle and pulley assembly identical dramatically reduces the cost of spare parts backup and ensures you will always have the right part in stock!
  • Using an oil bath sealed spindle unit reduces the daily maintenance time and allows your operator to do his job – cutting the grass quickly and efficiently.
  • To ensure the mower is an effective cutting unit, even when the conditions become rough, thick or wet, we use two V belts wrapped around the deep grooved cast iron pulleys. 
  • You could say our spindle and drive system compares to that of a gearbox/driveshaft system, without the hassles and constraints!
  • The TM371 has been designed to be simple, strong and functionable – even the safety covers have been made from 4mm aluminium tread plate that you can stand on them and improve accessibility to the rear of the tractor.  The result is a mower that operators, mechanics and Park Managers all love!
5. So let’s make a deal – give them a plan of what to do next. This is the last thing that your reader will see, so tell them exactly what action to take, or what action you will be taking. Show them how to get the ball rolling so they can take advantage of your product or service as soon as possible. Present a suggested timeline.
For example:
Mr Smith, we are so confident that Imaginary Shire Council will be totally satisfied with the Olympic TM371 Park Mower, we will offer you a 100% money back Guarantee!  If you are not totally satisfied with the TM371 after three months from delivery, we will pick up the mower and refund the full amount of the Councils paid invoice.

I will call you next week to clarify any parts of our proposal for you.  To ensure you a swift delivery, I will also confirm the specifications of your mower and confirm with you the expected date of the Council’s official order so we can include your TM371 into our production planning.

I am looking forward to including Imaginary Shire Council on our very satisfied customer list.

Best Regards

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