The global business software market is worth nearly $400 billion, and it’s only growing.

If you’re selling software to companies, you need to master the art of the software development project proposal. Without those skills, your business could lose out on massive clients.

That’s why we’ve put together this guide on how to write a software proposal. By the end of it, you’ll have everything you need to develop a compelling pitch — the easy way.

What Is a Software Proposal?

Software proposals are formal business plans/project proposals that convince organizations to purchase and use your software or development services. They describe your product, team members, features, pricing, and benefits for customers.

There’s a lot of competition out there for paid projects, so you need to be able to write a winning proposal that gets the job and displays your value as a reliable vendor. Otherwise, it will be like showing up at an interview without any clothes on: You’ll get turned down!

Why Do Companies Need Proposals?

Many businesses face tight deadlines or have to implement new software that meets changing regulatory requirements.

It isn’t efficient for them to figure out the process themselves because it would take too much time, cost more money than they can afford, and still result in sub-optimal results.

Software proposals are written like any other business or project proposal. But instead of just promoting your services (which can easily be faked), this calls for proof that you’re worth buying services from!

This means that your proposal should focus on showing proof of your skills, product, and team rather than empty promises.

What Should a Software Proposal Include?

A comprehensive software proposal includes at least these characteristics:

• A description of your organization as the vendor, including information about team members and previous work completed.
• Details regarding what you will deliver to customers, often called “scope”. This includes product features and any additional services which you won’t charge for. These extra services are also a great way to differentiate yourself from your competitors!
• An estimated timeline with different milestones lets customers see how quickly they’ll get results from working with you.
• Price details such as cost per user, total costs, discounts, and payment details.
• Any restrictions such as licensing or use of the product.

How Long Should a Software Proposal Be?

Whether you write a short one-page proposal or a long, comprehensive document depends on your clients’ needs and how much information they need to make their decision.

Many organizations request short proposals for initial inquiries; these are usually companies who are unsure if they should implement new software but want to get an idea about price ranges.

Other customers may ask for detailed proposals. These cover every aspect of the project to get concrete answers about the costs of developing updated software.

Depending on the company’s goals, it is acceptable to prepare both types of proposals.

How to Write a Software Proposal Step-by-Step Walkthrough

Software project proposals can vary between firms, so no set template fits everyone. However, it’s easy to find a free project proposal template using a tool like PandaDoc.

Regardless of the template, there are a few core ideas you should cover in any detailed project proposal — here’s how they apply to software:

0. Open with an executive summary

Any project proposal needs an executive summary. It’s a concise, condensed version of the most important details from the rest of your proposal.

Your summary should include:

• Project name and your company contact information.
• Purpose of the project, or project scope.
• Details about what will be completed during the project.
• Timeline for completion—including milestones that outline when deliverables are expected.
• Benefits for customers.
• Your total price, including all costs and discounts.
• Payment details such as how soon you need to be paid once the project is complete.
• Any licensing or other restrictions on the use of the product.
• Conclude by highlighting your core strengths as a software development company

Even though it’s the first (and possibly only) thing your prospect will read, it should be the last thing you write. Don’t go into heavy detail, but cover all your bases.

1. Identify the project or problem.

It may be a security hole that must be patched to be solved. Perhaps an integration with another system needs to happen. Maybe they just need new functionality. Whatever it is, make sure to state the challenge you’re addressing clearly, and why.

The idea behind this step is to figure out who would be interested in reading your proposal and why they would want it at all. This helps you as a writer to focus your writing efforts on the right things.

2. Describe the needs of your customer or client.

It is essential to get your customer’s feedback regarding what they need. Use the information they provide (or any other research you did) and compile it into a list of requirements for your proposed solution. This also shows the client that your goal is to solve their problem, not just get paid.

3. Outline what you are proposing to do for them, including timelines and deliverables

Your proposal should include a description of what you will be doing for your customer or prospective client, as well as how long it will take and in what stages. Depending on the project’s complexity, certain things may need to be broken up into multiple milestones (e.g. design, development, testing). You don’t need to go into heavy detail with dates — that can come later.

You should also include any extra features or services you can provide for an additional price, as well as the discount they will receive if they pay upfront.

Your customers want to know exactly how much they are paying for and when they can expect to have their problems solved. So, be as clear as possible about what they’ll get from you. This helps remove any questions or doubts the customer may have about your skills or timing (and prevents them from needing to ask those questions).

4. Explain how your solution works and why it is better than alternatives (complete with technical details)

So why should anybody buy software from you rather than your competitors? Why are they paying for your services instead of just doing it themselves?

Outlining everything your solution will do to solve the customer’s problem or fulfill their needs clearly illustrates what they are getting. If there are other similar products available, point out precisely where your product differs from its competitors. Make sure you talk about how this makes it a better solution!

One way to illustrate the details of your solutions is to outline your technology stack. The best way to say “We use these technologies” is:

• X software platform (like Java) or X programming language (like Ruby)
• Y toolkit (like Apache Cordova)
• Z libraries (like jQuery)

If you’re pitching to a technology lead decision-maker or software developer, don’t be afraid to get technical here.

Pro tip: make a pros and cons list. Including a section outlining the pros and cons of your solution compared to common alternatives lets you speak from experience about why your solution is better. This helps the client make an informed decision about what is best for their company.

5. Present a timeline with deadlines for milestones and dates for project completion

Once you’ve clearly laid out all the milestones and components of your project, it’s time to show how long each step will take. As mentioned before, it’s a good idea to break things up into smaller chunks that can be completed within a week or two (to increase flexibility).

A timeline also shows that you’ve done your diligence in terms of planning and preparation. For the client, it means they can reliably fit the business proposal into their overall schedule.

6. Provide an estimate of cost or rates  based on previous projects

You should estimate what you are expecting to charge for the project so that your clients know exactly how much they will have to pay. Also, cover how they’ll be charged: is it hourly or contract? Will they pay in installments or upfront? This is a critical section, so go into detail.

As a bonus, this helps you build a strong reputation by not running into issues with undercharging or overcharging for work.

7. Outline any contingencies that might affect the proposal

Always outline any potential issues that may come up during the actual development process, even if they are unlikely or you think they are not worth mentioning. The last thing you want is a situation where you have to ask for more time/money to fix an issue that you could have mentioned upfront.

8. Include relevant testimonials, case studies, and references

Another way to show why people should hire you is by including any relevant statistics or reports from experience working on similar projects. You can also include any good industry references (like other companies that were satisfied with your services), which would help prove your value as a software partner.

If the client wants to talk to other people who have worked with you, or would like additional information about your company or its services, add a section that lists contact information for other relevant people. This includes references from other companies, colleagues from past jobs, and specific people you’d suggest they get in touch with if they want more info or feedback.

You can also include testimonials and reviews from past customers so that the client can see what it’s like to work with you.

9. End with a statement that you’re available to answer any questions they may have about your proposal or future work together if necessary.

Once you’ve finished writing your proposal, leave the reader with a way to get in touch with you. If possible, include your contact information under an “about” or “contact us” section of your website so that it’s readily available.

Common Mistakes when Writing a Software Project Proposal 

Here are some mistakes people often make while writing software proposals:

Not discussing the problem/scope of the project.

Make sure to fully explain what you mean by “problem”, and how your software will help solve it. Also, include a list of potential solutions and why they’re not as good as yours.

Inaccurate financial information.

Many businesses have trouble accurately calculating costs for large, long-term projects. Include a rough estimate for each cost that you think is necessary, but then back it up with an example of the exact price to ensure accuracy.

Not including enough information about how your software will help solve a problem.

Beginners may have trouble describing how their products will help the client, even if they are well researched and sound in theory. Offer examples of scenarios, and match each benefit to a pain point.

Not providing a way for clients to reach you easily and quickly.

Be sure to include information about how your potential client can get in touch with you if they ever encounter any issues or need an update on your progress.

Tips for Writing an Effective and Persuasive Software Project Proposal

Include ‘extras’ that don’t fit into any of the previous categories.

Adding photos/graphics/diagrams can make things easier to understand by illustrating concepts instead of just describing them. The likelihood of anyone having time to read everything page-by-page is slim, so keeping everything easy to access makes it more likely that they will find the information they need.

Include a cover letter.

Like a resume, your proposal should begin with a cover letter introducing you and your company to the recipient(s). The person you are proposing to will spend time reading through it, so make sure you include their name in your cover letter (or address them by name in the proposal itself).

Be personal without sounding too casual — this makes your proposal feel much more professional. If possible, try to meet or talk with someone before sending anything in writing. This allows you to understand better what the customer expects from a business proposal and how they would prefer it to look/feel.

Clean up the presentation and formatting of your proposal for better readability

It’s important to be concise, but it also helps if your proposal is cleanly formatted so that people don’t have to spend time looking through unorganized or poorly structured sentences or paragraphs.

Ensure that everything you say has a clear theme and purpose while always saying things in the fewest words possible. Keep in mind that most managers will likely skim over projects rather than read them word-for-word; they need to get an overall sense of what’s included.

Summarize everything in a table or list for easy reference

It’s much easier to find things in your proposal when they are organized by section, prioritized, or put into an outline format. This also clarifies where certain information is located within the document so that people can go back and refer to it.

Master Software Proposals Today With Pure Proposals

You’re busy — git pulls and pushes, tracking your hours, fixing bugs. That’s your specialty, and you’re going to keep at it. The best way to do that? More clients and more proposals.

That’s where Pure Proposals comes in. We help you master the art of the proposal so that you can get new clients and keep doing what you love. Contact us today to learn how we can help!

Run an HVAC business or know someone who does? Check out How to Write a Winning HVAC Proposal.

Frequently Asked Questions

What should be included in a software development proposal?

A software development proposal should include all relevant information about your company and the project you’re proposing to take on.

This includes an executive summary detailing why you as a company would be great for the client and specific details about how your software will help or benefit them. Also, include a list of potential solutions and why yours is better.

What is the proper format for a proposal?

You have several options when it comes to finding a project proposal template for software development. Overall, they typically follow the format of a standard project proposal or business proposal. That includes a summary, scope, project objectives, technical details, pricing, and references. Don’t forget a cover letter!