How to make more money by avoiding proposal writing mistakes

“Send me a proposal” is a phrase that’s as common in the HVAC industry today as “have a nice day” was in the 1980’s. A well written proposal can be the difference between success and failure when selling hvac services and equipment in today’s marketplace.

In our rapidly changing world, your proposal may be the only contact a decision maker has with you, your company and your offer. When properly planned and written, a proposal can be an extremely effective sales tool, but unfortunately, many firms lose business every day because they make one or more of the following mistakes when writing proposals:


MISTAKE #1  Forgetting the purpose of the proposal

The main purpose of your proposal should be to outline your solution to your customer’s problem in such a way that he takes advantage of your offer, even if your price is higher than your competitors’.

Think of your proposal as a partnership agreement. It should summarize your plan to help your customer receive the benefits he wants. Before writing your proposal, mentally put yourself in your customer’s place. Ask how emotional concerns will be addressed? How will you provide peace of mind? How will you make your customer’s lives easier and less stressful?


MISTAKE #2  Selling equipment instead of a “system”

Almost any HVAC company can sell a three ton replacement unit or new cooling tower, but only your company can sell YOUR system, one customized to meet your customer’s individual needs. When written properly, your proposal locks out your competitors because you’re selling something no one else can offer. Use words that show your customer is getting something special: “customized”, “designed for”, “engineered to meet”, “tailored” and “unique”.


MISTAKE #3  Listing facts instead of creating value

When you communicate more value than your competitors, you can receive a higher price for your products and services. We’ve all seen proposals saying something like, “Install new 3 ton a/c unit, start up and check out, $4,000.” How much value would this proposal establish in a customer’s mind?  On the other hand, tremendous value is communicated if features and their benefits are included: “Nitrogen charged ACR copper tubing will be used to assure a clean, dry refrigeration circuit.” “Flexible duct connectors will be installed to maintain quiet operation”.  “A properly trapped condensate drain system will be installed to protect your home from water damage”. The list goes on. The key is to list every task you will do and explain in writing why it’s in the customer’s best interest.


MISTAKE #4  Not asking enough questions

Questions allow you to collect the data necessary for your customers to accept your proposal. Use questions to determine the customer’s current situation. What do they like about it? Dislike about it? What would they like to change, alter or improve? You can also use questions to determine if your customers have or can get the money to pay for your proposal. By knowing what questions you want your proposal to answer, you can develop a question check list, so you don’t forget important points when meeting with your customers.


MISTAKE #5  Not understanding the customer’s fears (so you can eliminate them)

When you first meet your prospective customer, you should ask questions to discover needs, fears and concerns. If a prospect said she was concerned that mud would be tracked on the carpeting, explain in your proposal that, “the carpeting will be covered and the work area will be cleaned to the customer’s satisfaction before leaving”.  Other ways to eliminate fear: Enclose a list of references that include phone numbers. Include any relevant documents that show proof of insurance, (whether the customer asks for them or not). If appropriate, include testimonial letters from satisfied customers. Include statements like; “All code requirements will be met”, “Attached is a copy of our license”, “One full year parts and labor warranty is included.”

Don’t hesitate to show you know what you’re doing


MISTAKE #6  Not addressing each decision maker’s concerns

As our economy changes, more people are involved in making major HVAC/R buying decisions than ever before. In some cases, it’s impossible for you to meet “face to face” with all of the people who will be involved in the decision making process. To add to the quandary, each decision maker has different needs and may require different benefits from your company. Keep in mind, people don’t buy HVAC services and equipment, they buy the solutions, results and benefits they provide.


The Front Line Manager . . . may be concerned with reducing current problems. He want’s to know, “How will your proposal for services (or equipment) provide better comfort for our tenants?”

The Financial Manager . . . is usually concerned with money. She wants to know, “Is your proposal the best investment we can make with our limited capital?”

The CEO . . . is likely to focus on long term objectives. His question may be, “How will the new hvac equipment that you are proposing affect our facility’s resale value, if we decide to relocate with- in three years?”

              People don’t buy equipment and services, they buy what it does especially for them


MISTAKE #7  Making common blunders

Your entire organization’s ability to perform may be judged by your proposal. I recently saw a building owner disqualify a company, even though they had the lowest price, because their proposal was sloppy and the price had been “white’d out” twice. Other common mistakes to be avoided include: Using jargon, without explaining its meaning. Not checking grammar and spelling. When appropriate, not writing a cover letter and placing the proposal in a suitable binder or presentation folder. The more sophisticated the project, the more elaborate the proposal requirements.


MISTAKE #8  Not including evidence

The Missouri philosophy of “show me” now stretches across America. Include photographs with your proposal. Point out current problems or show before and after photos of jobs similar to the one you’re proposing. One of the easiest ways to show problems and explain solutions regarding HVAC equipment is by adding color photographs to your proposals. If practical, on your initial fact finding visit take photos of areas you want to address in your proposal. Include the photographs in your proposal to show how your products and services will solve current and future problems. This is the best way to communicate to decision makers you are unable to speak to personally. Also consider showing photos of completed jobs similar to the one you are currently proposing. If practical, and with diplomacy, use the customer’s equipment for “before and after” impact.


MISTAKE #9  Not documenting savings

The only common denominator between all of your customers is money. When possible break everything down into dollars. The focus should be on dollars instead of btu’s, kw/ton or eer’s. People want to make a wise investment, so include an economic analysis. Use a graph, chart or mathematical calculation that shows how much the customer will save by taking advantage of your proposal, or how much they will lose if they don’t. The projected bottom line savings for your offer of equipment or services should be easy to find. But don’t confuse the decision makers. If you are dealing with a large dollar proposal, save the pages of savings calculations for a “savings calculations” section in your proposal. The Special Report, “Show Your Customers How To Save Money With Service Agreements”, outlines the most significant research completed on the savings your customers can receive.

An understanding of your potential customer’s utility rates can be critical to your proposal’s success. Proposals are shot down every day because projected energy savings are too low or ridiculously high. To show you understand more than your less informed competition, consider separating electric demand savings from usage savings. If a ratchet is included in a rate schedule, explain how it will affect short and long term savings. For added impact, include a copy of this customer’s electric utility rate schedule.

Don’t forget that reducing the utility bill is not the only savings you can provide your customers

Remember, you can;

  • enhance productivity
  • increase equipment life
  • reduce loss
  • improve health
  • provide convenience
  • protect revenue
  • save time, stress and frustration.


MISTAKE #10  Not explaining who is to do what, when

Time is the currency of today and organization saves your customers’ time. Demonstrate that you’ve thought out the entire project you’re proposing and show how well organized you and your company are. Tell who pays for freight, taxes and other common costs.

Answer questions before they arise


MISTAKE #11  Not taking full responsibility

People value certainty over uncertainty. When you’ve stated in your proposal that you’ll take full responsibility, your customer has one less worry. If a subcontractor is needed, you’ll make all of the arrangements. If the utility company needs to be contacted, you’ll do it. The “peace of mind” you’re providing is a benefit that allows you to charge and receive more than your competition.


MISTAKE #12  Not offering options and alternatives

People want choices. One of your jobs is to narrow down all available choices and describe the most desirable solution to the customer’s problem. When practical, identify a stop-gap solution. Along with both solutions explain why you’ve chosen the most desirable one and list the “total cost” of each. Besides initial investment, don’t forget, peace of mind, return on investment, time saved, productivity increased, etc. When presented properly, there should be little doubt in your customer’s mind as to which choice to make.


MISTAKE #13  Sending the proposal

One of the biggest mistakes you can make is sending a proposal. Whenever possible they should be delivered in person, so you can go over the proposal and ask the customer to approve it on the spot. When totally impossible to deliver it, use Federal Express or another over night delivery service. This lets the customer know how important this proposal is and allows you to know the day it arrives so you can call the customer and ask him to accept your offer.


MISTAKE #14  Writing too few proposals

The easier it is to write proposals, the more proposals you’ll write. The law of numbers states, “The more proposals you write, the more you will sell.”  Think how you can add additional information to the proposal format you are now using. What can be eliminated or changed?

To save time, have a basic format for each type of service or equipment you sell on your office word processor. With a little planning, you can make a few changes that show that your proposal is tailored to the decision makers specific needs.

In today’s rapidly changing economy, HVAC service and equipment replacement sales are won by inches, not miles. The firm who makes the least mistakes will be in the best position to get the order.

View All blog