Cisco Systems RJ-45-to-AUX manual Estimating the Cost, Total up front, 349

(briefly, this term refers to the fact that buying equipment correctly up front will be significantly cheaper than upgrading individual components later when it becomes necessary). Customers may not want to invest more money than they have to in the short term, but sometimes they will—and you wind up making a much bigger sale. Occasionally, your customers will find wisdom in investing in the future.

Estimating the Cost

When estimating the cost of a proposal, I add all the equipment costs and then add an additional 10 percent to the total, just in case I forgot something such as cables, tape, or tools. (I always have to go to the store for something I had no way of knowing I’d need.)

Make sure you factor in small things, such as tape, cables, cable straps, bundle holders, connectors, cable converters, extra RAM, cable testers, and the like. Don’t forget to include parking costs—especially in San Francisco at $17 to $30 per day.

Tip If you are really trying to bid competitively, you may want to make the equipment costs appear lower and increase the labor cost by just a few dollars or increase the labor time estimate.

Presenting the Final Proposal and Creating Expectations

The process of creating a proposal may seem difficult; but once you make a successful proposal, you can use the same one over and over, with modifications. The final proposal should break down the costs of the equipment, software, your labor, and licensing (software and hardware), and it should include network diagrams if possible. The proposal should look professional, including diagrams created using software such as Visio, to show how the equipment will be placed, and spreadsheets listing the equipment costs and the amount of realistic labor for installing each item.

At the very least, the proposal cover should be full color. A picture of the customer’s building is great to include. I once had a manager who had a sign that read, “THE PROPOSAL: Dumb people like pictures.” Of course, you don’t want to call your customers dumb—but they lack your knowledge. If they didn’t, you wouldn’t be there.

Don’t get too in−depth, such as estimating the number of feet of cable needed for each room. That’s a little too much. Just include a single “cabling” item on the proposal.

However, you should go into great detail as to the steps you will take to complete the job. Be sure that these steps are outlined in a language that the customer can understand. Assume that the customer does not know such terms as CPU, RAM, and CSU/DSU. Explain what each device does and why it is needed. A proposal that the customer can’t understand won’t help you get the job. I have seen some proposals that included a list of acronyms or a glossary.

Along with the proposal the customer is expecting, I include a higher−end proposal outlining what the customer could purchase for future needs, as well as a separate proposal to help negotiate the cost of continued support after the installation. Someone has to support the equipment after it is installed—might as well be you or someone who works with you.

Warning	Unless the customer asks, avoid contracts and proposals that keep the total amount
	open. A contract or proposal that states you’ll work for $75 per hour until the job is
	done will most likely be unfavorable—unless you’re contracting with the government,
	and then I highly recommend it (that was a joke). Customers want to know the final
	total up front.

The last thing you should do is place an expiration date on the proposal. Equipment costs change, and so do your time constraints. Usually I make mine good for 90 days. This limit gives the customer plenty of time review the proposal and come to a decision.

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