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Do you charge to do a bid or respond to an RFP?

I am a web designer. I am usually talking with prospective clients about ways to improve their websites, and I usually give a fairly detailed written analysis and a quote before they hire me. I believe that generally they are only considering a very short list of companies, and in some cases, I am the only contender.
A larger web design company told me that they charge for such an analysis at their regular hourly rate, but waive the fee if the client choses them. If not, they are free to take the analysis elsewhere to have the work done.
The smartest thing to do is probably to do a less detailed analysis up front and not charge for it, but I have won clients even though I was charging more, simply based on the quality of my proposal.
So is this an example of "giving away the product for free to encourage sales" or am I leaving money on the table?
I`d love some feedback.
Thanks.
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Comments
Here is what I do.
I usually provide the customer with a proposal but it is a basic proposal. I do not include technical specs, Hours of development, functionality, and first draft (mock up).
The analysis is included with the price, and I do not send them a full Proposal until they give me a down payment to start developing. Once I get a down payment then I give them a full blown Proposal, that outlines functionality, specifications, Marketing approach and anything that the customer needs to put into their marketing plan. I outline everything from them (niche market, demographics and so forth)
Catherine