RFI, RFP, RFQ

Any individual, small business, or even large company that is new to the RFP process can easily become confused by all of the different terms and verbiage. In order to accurately and completely respond to any request, it is necessary to have a complete understanding of what is involved in that request.

As the technological revolution gains steam, pun intended, the RFP is becoming an increasingly important part of Business Process Outsourcing and maintaining business growth and operational stability. Both the Private Sector and the Public Sector (governments) are increasingly turning to these requests in order to gather information, build databases, and award contracts to vendors.

For the average business and anyone who hopes to be able to build on the back of government contracts, this means that there is an increasing need to actively engage in proposal writing. This means that there is an increased importance in establishing a comprehensive understanding of the entire process behind these requests.

This begins by having a complete and accurate understanding of the many different types of proposals, their purpose, and the reasons they are important for your continued business growth and expansion.

What is the RFI?

The first request type is what is known as a Request For Information or RFI. The RFI is, as the name implies, nothing more than a request for information. It is however, a detailed and specific request for information.

The ultimate purpose for a request for information may vary. The two most common reasons for issuing an RFI are to build a database of potential vendors or to determine new and improved methods, products, or services.

What Are Common Components of an RFI?

• Goals and Objectives for the RFI, also known as Purpose or a “Statement of Need” though it may have other names as well
• Issuer Introduction which gives the issuer an opportunity to explain who they are and give at least some indication of what they expect
• Vendor Qualifications determine which vendors are eligible to respond to the RFI and any particular attributes that the issuer is looking for with the RFI
• Information Request which lays out the exact details of the information being requested by the issuer
• Evaluation Process is a section where it will be explained how the issuer will determine which proposal or proposals are selected, and what the intended results of the RFI may be*
  
• Deadline is the time limit for the proposal response and states the latest date that any responses or proposals will be accepted by the issuer

*There may be instances where the issuer is putting together a database or creating a list of potential vendors for different reasons. In such cases, it is possible that different vendors with the same expertise will all be retained or “accepted” in some fashion by the vendor, regardless of whether or not any actual contract may be established as a result of the RFI.

What is the RFP?

The RFP is a Request For Proposal that asks for a complete and detailed proposal based on very specific parameters. An answer to the RFP comes in the form of a written business proposal that is written in full accordance with the guidelines set forth in the RFP.

The RFP is used by the issuer to determine which vendors may be suitable for specific roles and the provision of goods or services that are needed by the issuer. As was briefly noted before, the RFP is becoming increasingly common in the private sector as well, as more businesses turn to Business Process Outsourcing or BPO in order to facilitate more stable business operations in times of global crises.

What Are the Common Components of the RFP?

• Issuer Description which tells you a little bit about the company that issued the RFP
• Project Description which gives you more details about the project and relevant information specific to the RFP regarding the project
• Scope of Proposal which explains the parameters of the RFP and the subsequent response
• Compliance and Requirements is the section that will explain any specific requirements such as licensing, production capacity, or other restrictions as having been put in place by the issuer
• Bidding Process and Contract Terms will explain how the proposal responses are evaluated, as well as terms and conditions of the contract, not the least of which may include the Proposal response as part of the final contract
• Proposal Evaluation Process explains how the issuer will make the selection process, and how the Proposal response will be “graded” in order to determine which vendor is awarded the contract

What is the RFQ?

The RFQ is a Request for Quotation and may also commonly be known as an Invitation to Bid or a Request for Bid.

The RFQ is generally used to provide the issuer with a selection of vendors for specific goods or services. The RFQ is different from the RFP as the issuer may be selecting multiple vendors rather than relying on a single bid winner as is generally the case with an RFP.

What Are The Common Components of the RFQ?

• Product or Service Requirements that detail specifics about exactly what is needed and expected from the vendors
• Delivery Requirements that explain in detail the delivery timelines or guidelines for when and how services will be provided
• Quantity or Volume Requirements that explain the volume requirements per phase and overall
• Terms of Payment which explains how the vendor will be paid for their products or services
• Selection Process which explains how vendors or vendors will be selected
• Submission Requirements which explain the process by which the Quotations may be submitted in addition to the format and other more specific parameters
• Review Process which explains how the Quotations will be reviewed
• Deadline or the last day on which quotations may be submitted for review and consideration

How Important is Compliance When Responding to a Request?

One common factor among all of these requests is the need to follow compliance to the letter. When a request states that it requires size 9 Arial fonts with single spacing, or page limitations, or other restrictions, it is there for a reason.

If you cannot follow the comparatively simple directions of the Request, it is expected that you would not likely be able to remain within the compliance in other areas either.

Furthermore, as is always the case when people are handing out money, there are often a great many people with their hands out, proverbially speaking anyhow.

This is especially true with government Requests and even most grants. While this is not the only way that the potential vendors are short-listed, it is among the first steps in getting rid of as many proposals as possible without actually having to review them completely.

What is a “Go/No-Go” Process?

When everything is said and done, your best bet is to establish a meaningful and comprehensive Go/No-Go decision-making process. This allows you to carefully consider every aspect of each request individually, and determine whether or not to pursue the endeavor.

Perhaps the best and most comprehensive single method for making a go/no-go decision, is parsing the request and determining if you have a realistic chance of winning the bid. This also provides you with the opportunity to consider any additional costs that would be required, and determining whether or not your company can afford to win the bid.

Each of these decisions is the result of considering many different individual factors, but then again, that is the ultimate purpose for the Requests to begin with. In this way, you can look at the Request from each angle and give careful consideration to every aspect. Once you have all of the relevant information at hand, you can decide whether or not to pursue the Request, no matter what type of request.