What is an RFI and RFP?
An RFI is a formal request for general information from potential vendors/suppliers. RFIs are useful to gather information or ask general questions and are typically more limited information than RFPs. RFIs are fact-finding documents which ask open-ended questions to allow the vendor/supplier to fully explain their offerings. The vendor/supplier will often explain their position in the marketplace, how they license their product or services, and what costs should be expected from their services. The RFI is the document to created to obtain service and resource information. The 3-page to 5-page document provides an executive summary of the operation(s) to be obtained or outsourced, along with detailed information on the vendor/supplier’s specific capabilities.
In addition to gathering basic information, an RFI is often used as a solicitation to a broad base of potential suppliers for the purpose of developing strategy, building a database, and preparing for an RFP or RFQ.
In addition to gathering basic information, an RFI is often used as a solicitation to a broad base of potential suppliers for the purpose of developing strategy, building a database, and preparing for an RFP or RFQ.
An RFP, or request for proposal, is a more structured format of gathering information from vendors/suppliers. RFPs often occur using a bidding process between carriers to win business from a company. The company specifies its issues and invites carriers to suggest solutions based on their offerings. An RFP usually follows an RFI since it is more specific and tailored to the individual customer. When submitting an RFP, you should have clear needs and be willing to share internal information with the vendor.
RFI BEST PRACTICES
An RFI signals to potential bidders that a competition will ensue for a product or service, and that the potential client is seeking information in a formal, structured, and comparable way. Ideally, it also demonstrates that the buyer respects the vendors time and resources by requesting only the basic information needed to move forward with the process. Here are best practices that have been identified within the RFI process:
- Follow an established format - It is important to gather information in a formal and structured manner that enables direct comparison of supply-side companies.
- Be specific about the information needed - The more specific you are about the information you need, the more likely you are to receive a useful response. If your questions are too vague, the supplier may not understand what you are seeking, and will provide information that is irrelevant to your needs. Precisely define the information you want the supplier to include in the response.
- Limit the information request - Seek service and resource capability information only. Appropriate information could include specific details concerning the vendors abilities to perform a given service, or to provide personnel, facilities, etc. It might also include financial statements, an explanation of the supplier’s corporate culture, and profiles of its senior management, company goals, quality assurance, activities, and projects under contract.
- Pricing information is not needed at this introductory stage - Extraneous details concerning methodology are similarly useful only in later stages.
- Be considerate - Remember that the ultimate goal of this information gathering exercise is to establish a relationship with a respected business partner, the success of any such partnership involves mutual consideration, beginning with the initial requests for time and resources.
- Give the supplier appropriate time to respond - Preparing a response to an RFI typically takes less time than other request documents, such as an RFP or RFQ. A standard time frame is 2-4 weeks, but the process may take longer depending on the amount of information requested.
RFP BEST PRACTICES
- Define your project and needs - Write what your project is and what you need from vendors/suppliers before you write your RFP. A bullet-point list is a good format for this planning step. Note what you want your vendor/supplier to do, how they should do it, where the work should take place and when the work should be completed. You can refer to this outline while you are writing your RFP to ensure it contains all the key information.
- Write an introduction - Your introduction should explain why you are distributing an RFP and what you hope to achieve by hiring a vendor/supplier. Along with briefly explaining the project, state the problem you hope the vendor/supplier can help your business overcome. Your introduction may also include a summary of other key points about the project, such as your projects intended start date and deadline.
- Explain your company’s and project's history - Give a brief history of your company and the projects it is undertaking. This section gives vendors/suppliers the background information they need to evaluate your business' standing and decide whether they would like to do work with it. A vendor/supplier may be unfamiliar with your company, so include all the details they need to make an informed decision. This includes what your company does, what its values are and what makes it unique.
- Describe your projects requirements - Write a thorough explanation of what you require from the vendor/supplier. Take your time to ensure you list all your requirements so the vendor/supplier can determine whether they are suitable for your project. Include your budget and preferred experience in this section.
- Explain how vendors/suppliers should respond - Write the structure you expect your vendors/suppliers to follow when planning their response to your RFP. When all vendors/suppliers follow the same format, their responses are easier to evaluate. Depending on the complexity of your project, this may be a simple list of headings or a more detailed list bullet points underneath your headings
- Outline your selection criteria - Explain how you will select the winning candidate from your respondents. You should note what your company's priorities are, including essential criteria and preferred credentials. This section will help vendors/suppliers formulate a response that shows how they would be a good match for your business requirements.
- Note your timelines - Write the key deadlines vendors/suppliers should know: when you need their response by, when you will announce the contracts recipient, when the project will begin, and your final deadline, if known. Noting these timelines helps vendors/suppliers organize their schedules and determine whether they have time to work with your business. Ensure your deadline for submissions leaves enough time for the vendors/suppliers to adequately respond.
- Proofread and revise your RFP - Proofreading your RFP helps you identify and correct grammatical and spelling errors. After you have proofread and revised the RFP, send it to a colleague involved in the project for their feedback. The time you spend proofreading and revising your RFP will make this document appear more professional.
AFMS can assist in developing and managing these processes.
Contact us today for more information.
Contact us today for more information.