10 Tips for an Efficient RFP
A vital step in any strategic sourcing project is the Request for Proposal (RFP). We talk about it a lot on our blog, but now let’s look at some of the key aspects that can make or break an RFP. Here are 10 tips which can make any RFP a success story:
1. Provide clear guidelines for the entire sourcing project
Providing a detailed overview of the ground rules and steps of the process is of paramount importance. Being thorough and explaining the guidelines from the onset can save you plenty of time down the road when you don’t have to spend time dealing with miscommunication or even worse, complaints.
2. Bring internal stakeholders on board
Make sure that everyone who should be involved in the process is involved. Make it very easy for internal stakeholders to have constant access to updates and developments. With Prokuria, internal stakeholders can have a clear overview of an acquisition from beginning to end at the press of a button.
3. Be clear on you goals and objectives
Presenting the vendors with a big picture of what you wish to achieve is a great way to give your long-term sourcing projects the best chance of success. It’s all good sourcing 10 industrial pieces of equipment, but mentioning that your end-goal is to further expand your production capacity by the end of next year can result in you having a dedicated pool of suppliers for the project each step of the way.
4. Select the right pool of suppliers
Sending an RFP to a huge pool of suppliers can still put a strain on your department. Instead, use an RFI to shortlist a core group of suppliers that are definitely right for the sourcing project at hand.
5. Be clear on priorities and evaluation criteria
What is the most important to you — that is, what MUST you have? What other aspects are merely desirable, “like to have” items you can live without? Being clear about these criteria, and ranking them by importance, helps both you and the vendor in setting expectations.
6. Compare apples to apples
Avoid cookie-cutter vendor form templates! Ask the right questions so that you get maximum differentiation between responses. Having 10 suppliers providing similar price ranges, delivery windows and post-sale services does not make the selection process very easy or efficient. Put some time in preparing the best questions as this can make the difference between selecting a stellar vendor and a mediocre one.
7. Include a draft agreement
Imagine the following scenario: at the end of the RFP round you are left with three suppliers, one outclassing the others by a wide margin. You send out the RFQ, you get a price confirming that the supplier you had set your sights on is the right choice and you move to close the deal. Except that there’s this clause that is a deal-breaker for you and the supplier won’t budge. A good opportunity down the drain, time wasted. Including a draft agreement or contract from the RFP stage can spare you a lot of headaches later on.
8. Be proactive
Collect all the information that you believe might be needed in the later stages of the sourcing project and preemptively provide the details that might be requested of you. Start any negotiation from a strong footing, having covered any potential sensitive areas and boosting your leverage with suppliers.
9. Do your homework
Be sure to ask for references and case studies from suppliers qualified for the RFP, but don’t limit yourself to what you are presented with. Particularly for larger suppliers it’s easy to find out past clients not voluntarily provided, and reach out to them ensuring that you select the supplier with the right expertise and background for your project.
10. Follow up with non-selected vendors
It is extra work, but following up with non-selected suppliers is an investment in future RFPs. Consider going over the decision process, so that they can make potential improvements. Taking this time could increase the chances that they’ll want to respond to a future RFP.
A good RFP is intrinsic to a successful sourcing project. Take the time, use the tips, do you research and your organization will profit from it.