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Learn everything you need to know about the RFP process right here. The RFP process is one of the most rigorous and rewarding experiences for many small business owners and large corporations. Its rewards can often include long term contracts with the government and private partners worth millions. A reward like that certainly isn’t going to come easy. It takes a commitment to quality and attention to detail. Read more to discover everything you need to know about the RFP process.
An RFP or request for proposal is a document that requests a proposed solution to a stated client issue. A government or commercial client will solicit RFP documents to prospective bidders during a bidding process and in turn will receive proposals that detail each bidder’s solution. RFP documents range in size. Some commercial RFPs can be only 2 pages, while government solicited RFPs are usually 50-100+ pages. It varies based on client requirements, the complexity of the issue, and contractual agreements.
Client requirements can include anything from managerial capabilities, technical requirements, project oversight details, staffing needs and other information.
Most RFPs have standard sections as the document requests detailed information from prospective bidders. The complexity of an RFP varies per industry but in general all RFPs contain an explanation of client requirements and the following sections:
Remember to read the RFP in its entirety and grasp a clear understanding of the requirements to ensure compliance. Compliance will require at least 20% of your time for the proposal response.
The RFP is as old as the pyramid. Well maybe not that old, but it is a common (some think outdated) form of vendor selection, especially for the U.S. Government. Many industries use the RFP process to acquire new vendor partnerships and to foster a transparent selection process. There are several types of RFPs including, but not limited to, the following:
Government RFP: A government RFP requests proposals from bidders when an agency needs to acquire a product or service. Government RFPs are opened to the public to keep a fair process and reduce costs. Federal, state, and local government agencies will issue RFPs according to procurement need and budget requirements.
Commercial RFP: A commercial RFP is solicited by a commercial organization such as a retail, wholesale, or other business dedicated to the distribution of goods and services. Commercial RFPs are a little less rigid than your typical government RFP and it is possible for customer requirements to not completely be represented in the RFP either.
Staffing RFP: A staffing RFP requests the acquisition of human resources to provide labor for a client project. Staffing RFPs are common in the IT industry where highly skilled labor is scarce.
Services RFP: A service RFP requests partnership with vendors for consulting or managed service arrangements. Responses to service RFPs have to provide a highly robust and detailed solution to the client’s needs.
Along with RFP types that vary per industry and client requirement, there are several procurement documents, including, but not limited to:
Request for Tender: An RFT is a procurement document sent to vendors for an opportunity to submit an offer to a detailed tender. It is a bit different from an RFP in level of ask. RFP documents are detailed but are seeking solutions to a problem that is not defined in scope.
Request for Information: An RFI precedes the RFP and RFT. A client will send RFIs to vendors to collect general information and reduce the supplier list based on responses.
Request for Quote: An RFQ specifically requests vendor rates for proposed services and goods.
Request for Resume: An RFR requests human resources through the evaluation of resumes. Vendors submit the most qualified resources with detailed explanation of their skills based on the RFR requirements. RFRs are often used in the public sector.
Due Diligence Questionnaire: A due diligence questionnaire allows buyers to evaluate the compliance of a prospective vendor.
Procurement SOW: A statement of work is a form of agreement that provides the details of the actual work to be performed for the project.
Invitation to Bid: An IFB requests vendors to bid on an opportunity usually when the solution is relatively commonplace or known while price may vary.
Wow! That was a lot! We hope you are not overwhelmed with all the acronyms and definitions just yet. (That was the short list). Don’t worry. We won’t bore you with the others. Let’s get back to the RFP and how to respond to it.