We all have a love/hate relationship with buying big ticket items –the excitement of having something new that hopefully solves a problem we are experiencing, against the anxiety of going through the procurement process. Procurement people think this is the exciting part, not so much for the rest of us. There are several tools available to communicate your needs and desires to vendors, each one able to generate a specific outcome along the purchasing path.
The tools are:
Request for Information (RFI)
Request for Qualifications (RFQ)
Request for Proposal (RFP)
Each has its place in the process, depending on what you want to achieve and the amount of knowledge you have about the item or service you are looking for.
Let’s start with the most familiar first –the Request for Proposal or RFP.
Depending on the business you are in, you may have been involved in generating an RFP for a product or service or been on the other side of the table providing a response to an RFP. Typically, a Request for Proposal is specific in what it is asking for. It will have a specific set of requirements. These tend to be more specific than high level business requirements but not as detailed as technical requirements –in other words, the level of detail required to ensure you get what you are asking for. It may also include specific contract requirements that the vendor will need to comply with. The vendor typically responds indicating how they will satisfy the requirements stated in the document, agree to the contract requirements, and provide specific pricing for the product or service you are looking for.
What do you do if you don’t really know what solution you want?
The Request for Information (RFI) or Request for Qualifications (RFQ) would better suit your needs. These two tools are thought of as predecessors to the RFP.
The Request for Information is a useful tool when you may not know exactly what you want –you are looking for vendors with products or services that can solve a particular issue you have. While less burdensome than an RFP, there is still a level of effort required on your part. You need to be able to articulate what you are looking for either through a detailed statement of the issue or a high-level set of business requirements for the vendor to review and respond to. If your organization has particular contract requirements, this is a good spot to introduce them. If you need budget cost numbers, this is a good time to ask for them.
Understand that you are not guaranteeing you will purchase the goods or services identified and at the same time the vendor is not providing actual pricing. The end goal of this document is not to get a vendor on board or a contract in place, rather, the objective is to find a pool of vendors offering a solution that can work for you. The RFI or RFQ process is typically followed up with an RFP sent to the vendors you have identified as qualified from the RFI / RFQ process. Having gathered information from a variety of vendors, you are now better prepared to write your RFP.
Level the playing field with Scoring
All these processes, the RFI, RFQ, or RFP, will require some sort of scoring process for the responses. Typically, the scoring framework is developed in conjunction with the end user of the item or service. The scoring should be based, at least initially, on the vendor’s response to your requirements –do they say their product or service can do what you need it to do? Is their solution acceptable to the user of the product or service? This is the first phase in determining who you would like to have further discussions with.
In the case of the RFI or RFQ, you are looking to reduce the number of vendors you will have involved in the RFP process so you are only reviewing proposals from vendors that can provide you with the product or service you need. In the case of the RFP, you are determining who you want to work with further on purchasing a solution.
If you are looking to begin a purchase that will require a RFP or RFI, check with your organization’s Procurement team. They may have templates and guidance that can help you in creating these documents. If your organization does not have a structured purchasing process and you feel an RFI or RFP is required, there are outside resources that can assist you. These resources bring a level of expertise in developing requirements and documentation as well as working with vendors to assist you in the procurement. You can find organizations that are “vendor agnostic”–they have no association with a specific vendor and are focused on getting you the best product or service. Engaging these resources can help you streamline the process and get a better result–often it is a shorter period.
Crafting a successful RFP, RFI, and RFQ are some of the most difficult tasks for people dealing with purchasing. It requires analyzing needs and resources, coming up with ideas for possible solutions, and allocating budgets. Knowing what types of requests to use, however, can make these process much simpler and prevent you from feeling overwhelmed or underprepared. Taking advantage of the different request forms is an easy way to make sure that vendors get the most accurate information they need to effectively offer their services or products to your organizatio.
If you have any questions about which tool to use or aren’t sure how to best craft your request, don’t hesitate to get in touch with MSSBTA for helpful advice on navigating through the pre-purchasing process. With the right tools, efficient communication between buyers and vendors becomes easier and helps ensure satisfaction on both sides!
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