The request for proposal ( RFP ) is a document requesting a proposal, often through a bidding process, by an agent or company interested in procuring commodities, services or valuable assets, to a candidate suppliers to submit business proposals. This is delivered at the beginning of the procurement cycle, either at an early stage of the study, or the procurement stage.
Video Request for proposal
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An RFP is used if the request requires technical expertise, special capabilities, or where requested products or services do not exist yet, and the proposal may require research and development to make whatever is required.
The RFP presents preliminary requirements for commodities or services, and can determine the various levels of appropriate supplier structure and format of response. Effective RFPs typically reflect short-term/long-term business strategies and objectives, providing a detailed insight into which suppliers will be able to offer a suitable perspective.
Similar requests include query (RFQ) requests, where customers may only seek price quotes, and information requests (RFIs), where customers need more information from vendors before sending out RFPs. A RFI is usually followed by RFP or RFQ.
In principle, RFP:
- Inform suppliers that organizations are looking to get and encourage them to do their best.
- Need a company to decide what to buy. If the requirements analysis is set up correctly, it can be easily inserted into the Request document.
- Inform the supplier that the selection process is competitive.
- Enables widespread distribution and response.
- Ensure that suppliers respond to identified needs factually.
- Generally expected to follow a structured evaluation and selection procedure, so that the organization can show impartiality - an important factor in public sector procurement.
Maps Request for proposal
Specifications
RFPs usually involve more than demand for prices. Other information requested may include basic information and company history, financial information (may be sent to the company without bankruptcy risk), technical capability (used in the provision of primary services, where the goods have not been previously made or where the requirements may be met by various technical means ), product information such as stock availability and expected completion periods, and checkable customer references to determine the suitability of a company (including the educational and military background of its employees on the project --- college graduates and those with advanced college degrees may add "value" of the bidder).
The ubiquitous availability of the Internet has led many government agencies to switch to government-run websites or operated by vendors providing RFP and RFI and RFQ lists. Many allow vendors to sign up for no fee to either receive e-mail requests in general or for certain categories of products or services that have interest. In some cases, the entire process is done online with responses as scanned documents or PDF files uploaded to the server; in other cases, or for legal reasons, responses must be sent in hard copy and/or on CD/DVD discs or flash drives by mail or delivery service.
In the military in many countries, RFPs are often proposed to meet the Operational Requirement (OR), after which the military procurement authority will usually issue detailed technical specifications to the tender (ie, bid) to be made by potential contractors. In civilian use, RFPs are usually part of a complex sales process, also known as a company sale.
RFPs often include the specifications of the goods, projects or services requested by the proposal. The more detailed the specs are, the better the opportunities provided by the proposal will be accurate. Generally RFPs are sent to suppliers or approved vendor lists.
The bidder returns the proposal with a specified date and time. Late proposals may be considered or may not, depending on initial RFP requirements. Proposals are used to evaluate conformity as a supplier, vendor, or institutional partner. Organizations typically follow a vendor screening process in detail to compile a short list of vendors who must be invited for a further round of negotiations. This filtering process can be a vendor rating model or internal discussion within the buyer's organization. Discussions can be held on proposals (often to clarify technical skills or to record errors in proposals or in many cases to negotiate about prices). In most instances, only selected bidders may be invited to participate in the next bid, or may be required to submit their best technical and financial proposals, commonly referred to as the Best and Last Offer (BAFO) . Further changes may be referred to as the Best Offer and Final Revision Final (BARFO) .
Once both buyer and seller organizations agree to the technical and commercial terms and conditions of the proposal, they can proceed to the next step such as contract signing, a work statement that will formalize the purchase transaction.
Today, many organizations are becoming more collaborative in RFP development; this is especially true for universities and other large public entities that make purchasing great technology. Groups that issue RFPs request specific use cases, rather than provide feature lists, and ensure they have the opportunity to include demonstrations, webinars and meetings as part of the RFP process to ensure they have a solid understanding of all competing products before making a Purchase.
More requests
- The Request for Association (RFA) , also known as the request for partnership or request for the alliance , is a proposal from one party to others to act together (usually in business) and share the benefits of this joint action.
- A Information Request (RFI) is a proposal requested from potential sellers or service providers to determine what products and services are potentially available in the market to meet buyers' needs and to know the seller's ability in terms of offer and the power of the seller. RFI is usually used on large procurements, where requirements can be met through several alternative ways. However, RFI is not an invitation to bid, does not bind buyers or sellers, and may or may not lead to RFP or RFQ.
- Request Quote Request (RFQ) is used when discussions with bidders are not required (especially when product or service specifications are known) and when price is the primary or only factor in choosing a successful bidder. An RFQ can also be used before issuing a full RFP to determine the general price range. In this scenario, the product, service or supplier can be selected from the RFQ results to be taken to further research to write a more complete RFP. In commercial business practice, RFQ is the most popular form of RFx used, with many companies that do not understand the difference between RFx, and so default to RFQ.
- A Qualification Request (RFQ) also known as Pre-Qualification Questionnaire (PQQ) is a document that is often distributed prior to the initiation of the RFP Process. This is used to gather vendor information from multiple companies to generate a set of leads. This facilitates the RFP review process by candidates for short list nominations that meet the desired qualifications.
- The Solution (RFS) request is similar to RFP, but more public and open. This allows the most flexible vendors or suppliers of all RFx to express their solutions, or their combination of products and services.
- The Tender Request (RFT) request, also known as Invitation to Tender (ITT) , is more commonly used by governments.
See also
References
Source of the article : Wikipedia
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