5 Critical Mistakes You're Making in Your Architectural Proposals
Writing proposals with a high probability of conversion is a skill often overlooked. Most architectural firms report a conversion rate for their proposals for new work at around 30%. This is hardly surprising; writing proposals is hard work. The thought, detail, and effort in strategically defining the work is important to selling the proposal and protecting your company. Surprisingly, 63% of all sales interactions end with the sales pro not asking for the sale (Zig Ziglar). This is as true for architects as for any other business, because just presenting the proposal is not enough you have to ask for the sale. However, your proposals are more than just a tool to secure work.
Protecting your company against cost, scope and schedule overruns is extremely important when you realize that, on average, projects go over budget by 27 percent of their intended cost, and one in six projects saw a budget overrun of 200 percent (Harvard Business Review). This means that at least a quarter of your projects are likely not making the profit predicted, and one in six projects may be costing you a lot of money.
Luckily, your proposal is the tool that can protect your firm, increase your profits, and secure the sale. By looking for these five critical mistakes in proposals you can double your conversions, increase your profits, and protect your company.
1. Setting Your Goals for the Project
“You can get anything you want if you help enough other people get what they want” (Zig Ziglar). When was the last time you questioned yourself why you were going after a potential job? Often times, we hear architects say they need the work to keep the doors open or to pay salaries and wages. There is no doubt that these things are important, but shouldn’t you be making decisions more strategically in your business?
Knowing why your team wants to go after a specific project will improve your success; did you know:
Most organizations have a 70 percent project failure rate. (4PM)
Only 28 percent of companies use project performance techniques. (PMI, 2017)
Only 64 percent of projects meet their goals. (Wrike)
Determining your firm’s goals for the proposal will allow you to target it, price it, track it, and measure its success in a more direct way based on results. In this way you will be able to measure the impact you are having whether you are trying to penetrate a new market, increase conversions, or limit your competition.
2. Protecting You against Scope Creep
Scope creep refers to the changes, continuous or uncontrolled growth in a project’s scope, at any point after the project begins. This can occur when the scope of a project is not properly defined, documented, or tracked. Project Management Institute (PMI) reports, “We see that 52% of the projects completed in the past 12 months experienced scope creep or uncontrolled changes to the project’s scope, which is a significant increase from 43% reported five years ago.” Which means that either we,as project managers are bad at predicting the scope of a project, or we are not clearly defining it in our proposals and agreements; my bet is on the latter.
Architects with some experience can easily predict how much time, effort and resources will be needed for a particular project. The problem usually is that the scope of the work is not defined in the agreement, which leads to project managers and architects providing services that were not forecast into the scope. Client’s ask for things all the time as if the relationship they have with you is an open check for you to do research, provide studies, and look at options for the new thing they just saw on the internet. All of this is scope creep.
3. Not Promoting Your Real Value
Architects find themselves in a conflicted place in society today. On the one hand, it is a very prestigious career held in high esteem and authority, on the other architectural services are treated as a basic commodity as if the client will get the same service or value at any firm. A recent article in Architectural Record states that architects “create value through outmoded delivery systems where the client’s first—and often most important—priority is getting the lowest fee from the architect. When your price is driving selection, you’re a commodity.” (Architectural Record, Phil Bernstein, Why the Field of Architecture Needs a New Business Model, 2018).
While we do not want to admit it, this lowest price predicament is our fault. We drive engineers, consultants, and contractors to provide us with the lowest price all but training owners and developers to do the same with us. “There is another way: shifting the value propositions of practice from selling time to creating results for clients” (Architectural Record, Phil Bernstein, Why the Field of Architecture Needs a New Business Model, 2018). The reality is that your clients need a result and if your firm is positioned to give them the best possible end result then you should be paid highly for that result.
Further, if your proposal highlights the result they should expect from your services more effectively than the amount of time and work it will take you to get to that result then it will appeal to the client more than the firm that is focused on the price. If it doesn’t then you need to ask yourself whether you really want to work for that client anyway.
4. Not Addressing The Client's Primary Concern
Most proposals miss the mark big time when it comes to what the client really wants. We get caught up in the scope: how many square feet, number of stories, architectural styling, and other programmatic requirements. Then we go back to the office to determine how many hours it will take us to produce the drawings and specifications for that work. All the while thinking that the prospect is concerned mostly with what the cost of our services are and how long it will take.
“But focusing exclusively on productivity and cost/schedule conformance is to miss the real opportunity for change, like measuring the success of surgery not by whether the patient is cured but by how fast the procedure was completed” (Architectural Record, Phil Bernstein, Why the Field of Architecture Needs a New Business Model, 2018). Clients complete projects for a variety for reasons and unless you investigate what those reasons are and not just the scope of the work your proposal will fall short of selling them that you can solve their problem.
Our favorite question to ask: “what are you trying to achieve with this project?” Often they do not have the answer or will reply with something like “it matches our business goals” or some other generic response, but if you go deeper you will find their emotionally tied “why.”
5. Not Following Up
Follow up is a phenomenon that plagues almost every industry. With the technological age we see auto-responders trying to catch us when we leave things in our cart or attempting to sell us before we leave the website. While professional services need different strategies, the requirement for diligently following up is the same: more sales.
“50% of all sales happen after the 5th contact, but most reps give up after just 2” (InsideSales). Further, “Only 2% of sales happen at the first meeting” (MarketingDonut). Other statistics today look at how many of your leads and prospects do online research before they buy and the results are up around 80% of buyers. While these statistics vary by source, we all know that people are doing online research before they buy. This means that you have to get them interested enough to do this research.
“92% of sales pros give up after the 4th call, but 80% of prospects say no four times before they say yes” (MarketingDonut). Moreover it is important to “Stay vigilant. 83% of prospects who request info don’t buy for 3–12 months” (MarketingDonut). The best way to do this is to have a system to follow up after you have been contacted and especially after you send a proposal.
Ensuring that your propsals address these elements will increase your conversions, profit, and project success rates. The book Architectural Proposal Strategies New Ideas Bigger Profits covers these areas and strategies, additionally it will show you how to focus on the prospects buying behavior; and how to use bundles, cross -sells, and up-sells in your proposals, as well as detailed examples of proposal strategies that convert.
Get yours now at https://www.architecturalproposalstrategy.com/