A Request for Quotation (RFQ) or a Request for Proposal (RFP) is a business process/document in which a company requests a quote from suppliers for the purchase of specific products or services. It is a critical aspect of finding the right supplier for your needs.
A well-structured RFQ represents the voice of customer. It enables you to communicate your requirements and assess all aspects of the supplier that are critical for you and allow for fair and objective scoring. An RFQ allows you to get meaningful information from suppliers in an easy-to-understand format for better analysis.
RFQ takes subjectivity out of the equation and showcases what each supplier has to offer your company. While there are many suppliers, some will suit the unique needs of your business better than others. RFQ helps you to understand which ones can do that best.
However, an RFQ that is poorly structured will make the selection process difficult. It can delay the entire process and lead to a wrong selection for your business.
Here’s what you need to know about creating an RFQ that will help you find the supplier you need.
Tips for a Well-Structured RFQ
Creating a comprehensive RFQ is a critical step of the strategic sourcing process. It takes forethought, intentionality, and an understanding of what your needs are. It also requires the proper structure to make sure that you can objectively compare each of the suppliers to find the right one.
Control Supplier Responses
Provide predefined options to select from to generate uniformity across suppliers and enable faster analysis. For open-ended questions, such as understanding a process or functionality, the controlled response can be supplemented by a comment.
Divide It into Sections
A clear order with your questions makes it easier to comprehend and enables suppliers to respond faster as they can distribute relevant sections to their functional groups.
Define Pricing Format
Set how you would like to see pricing, such as hourly or monthly. Keeping everyone’s response the same makes it easier to compare the potential supplier’ offerings. Additionally, allow them to also include pricing in their preferred format.
Provide Relevant Information
Providing information upfront, such as forecast demands, testing requirements, qualification process, and terms and conditions can be helpful in getting better responses from suppliers. It also reduces the probability of scope revision and unfavorable price adjustments during negotiations.
RFQ for a Better Supplier
A comprehensive RFQ helps both you and your potential supplier. They understand exactly what you need, and you can evaluate whether they are the right fit for your business. By following our tips for your RFQ, you can make the process of finding a supplier both easier and more accurate.
Need help putting together an RFQ? Our experts have the knowledge and resources to make sure you pick the best supplier for you. Contact us today to learn more about how SourcX can help.