Although they seem similar, the acronyms RFI, RFP and RFQ represent different yet essential parts of the procurement process.
- The RFI is a request for information.
- The RFP is a request for proposal.
- The RFQ is a request for price quotation.
They are official documents issued by a government contracting body that’s getting ready to purchase a product or service. But not all are suitable for every vendor to pursue.
It’s important to understand the role of each request and how they compare to each other. This is so you don’t waste time going after opportunities that don’t match your own business development priorities or capabilities.
This article explains how these requests differ. VT Docs RFP software can help you not only to craft a response but to decide whether you should respond. So you can focus your proposal team’s attention in the right places.
Key differences between RFI, RFP and RFQ
If you find the terms confusing, you’re not the only one. In fact, some solicitations are described incorrectly by the issuing body. A good way to think about the differences between the RFI, the RFP and the RFQ is that each indicates a different level of readiness to buy. RFI being the least ready and RFQ being the most.
- RFI – this is a request for information. A signal that the government body is probably in the market for a solution but won’t be buying imminently. After reading the responses to an RFI, the contracting authority will be better informed about the available solutions to its business problem. And the competing vendors who can help them. They’ll also have a good idea of which vendors have the most insight or market knowledge in this area.
- RFP – this is a request for proposal. It indicates that the issuer is shopping for a vendor, but they need more details before they can buy. They’re open to new approaches or ideas. The RFP will ask vendors for their pricing and the approach they’ll take if they win the contract. The RFP will also give a sense of the deadlines and timelines that the successful bidder will need to meet.
- RFQ – this is a request for quotation. It shows that the issuer is ready to buy now. They’ve done their research. They know exactly the service or product they want, and in what quantities (or for what duration of time). They’re ready to get precise pricing and they’re not interested in hearing about new solutions they haven’t already considered.
The RFI – what you’ll need to craft a response
Expect the government contracting body to be in knowledge-gathering mode when it issues an RFI. To be ready to respond, it’s helpful if Subject Matter Experts (SMEs) on your team keep up to date with the latest technologies in their areas and are comfortable talking about how these can fit with business challenges.
Of the three requests – RFI, RFP and RFQ – the RFI will ask the most questions, because the issuer is building its knowledge about solutions in the market, vendors, and approaches, including advantages and disadvantages. Get ready to be generous with your answers and insights: show that you know your topic, you’re thinking strategically, and you have opinions on what works.
This might feel like you’re giving a lot of insight for free, but your RFI response will probably offer about the same level of vision and industry knowledge that your SME might put into a conference talk, blog, or pre-sales material. Indeed, you may be able to re-use content previously created for those purposes – and for previous RFIs — to speed up your RFI response.
If there’s a solution or approach that your experts know works best for the general business challenge outlined in the RFI, you can begin shaping the issuer’s thinking in your RFI response, laying the groundwork for your bid, if an RFP is issued.
Pay special attention in the RFI to:
- insights into the issuer’s overall business challenge
- put these at the heart of your response, to show you understand the customer
- take the chance to convey your market and solution knowledge and experience
The RFP – what you’ll need to craft a response
Not every government contracting authority will issue both an RFI and an RFP. The second doesn’t always follow the first. In fact, if an issuer has enough knowledge about the market and the solutions, they may jump to an RFQ, where they know what they want and just need your pricing. The issuing authority who does issue a request for proposal will provide more detail about the problem they must solve, and they’ll ask detailed, specific questions about your solution and ability to deliver.
You can save time by making sure you have customer success stories written up and ready to use, including your customer’s business pain, the solution you proposed, and the benefits achieved. Do you have industry certifications or testimonials about how they’ve benefited from working with you? Always include these if relevant.
This is a competition, and an RFP means the issuing authority is ready to shop for the vendor it wants to do business with, potentially for a lucrative, long-term relationship. That means you must do more than just show a track record of delivering a relevant solution. You also need to show you’re great to work with, and that begins with customer focus. Read the RFP closely to make sure you understand their business need and keep that at the heart of your response.
No issuer wants to go into a relationship with a vendor whose RFP response is all “me, me, me.” Even something as simple as the number of times you mention your own name versus the customer’s name in your RFP response can signal to the issuer whether your focus is on them.
Pay special attention in the RFP to:
- additional detailed insight about what the customer wants to achieve
- red flags such as unrealistic delivery timelines that might make this an unattractive prospect
- unique selling propositions that set you apart from the competition
- watch your own use of language: make your response clear, complete and compelling
The RFQ – what you’ll need to craft a response
The government contracting authority that issues a request for quotation has reached the end of its knowledge-gathering phase. The RFQ is entirely price-oriented and is common when the contracting authority is looking for predictable, off-the-shelf products or solutions. Compared to other solicitations, the RFI may have few or no insights into the issuer’s business problem.
Be prepared with a clear understanding of what pricing is feasible for you within the given deadlines. What are your payment terms? Can you commit to their delivery schedule?
The RFQ is not the place to suggest new approaches or go outside the parameters of what’s been requested. The issuing authority wants your best price for the work, but make sure your pricing team has done a reality check to determine whether this is a profitable opportunity worth pursuing.
Pay special attention in the RFQ to:
- deadlines and payment terms
- whether this opportunity is financially worthwhile
- the lowest cost will be paramount for the issuing authority
The role of VT Docs in helping you answer an RFI, RFP or RFQ
If your organization subscribes to services notifying you of the latest government solicitations, you’re probably being pinged with more opportunities, more frequently, than you have the resources to analyze. Use automation to reduce the manual workload, and you can pinpoint the most promising RFIs, RFPs and RFQs. You can use VT Docs at every stage of the response process to save time and help you make better decisions:
- make faster bid / no bid decisions by using VT Docs to compare new opportunities to your core skillsets and past wins at scale.
- ensure you’re making decisions based on evidence (rather than gut feeling or past business relationships) when choosing subcontractors to team with on a pursuit.
- improve the readability and professionalism of your RFI, RFP and RFQ responses by using VT Docs to identify incorrect and inconsistent use of acronyms or acronyms that have been defined more than once.
RFP software like VT Docs works alongside your existing work practices and helps you automate time-consuming manual processes, so you have more time to spend on proposal quality. You’ll also reduce the risk of missing key requirements in any solicitation, and you get the peace of mind of knowing that vital decisions like bid/no bid are based on hard data rather than instinct.cf
