What Is a Request for Proposal (RFP)?
Developing RFPs is a valuable business practice that you as a buyer can use to request information regarding products or services from vendors in relation to a project. This way you receive necessary data to make informed decisions on your procurements.
A request for proposal is the first step in a formal, systematic process used to find vendors to do work for you. Government agencies and other public institutions use the RFP system to promote fair competition as it helps prevent cronyism and takes bias out of the bidding process by ensuring transparency and documenting all of your requirements.
It is important to keep these elements in mind when creating your RFP:
- An RFP is basically a project announcement that a company creates in order to find contractors and vendors.
- It is important that your RFP defines the project precisely – so that both buyers and vendors can refer to it.
- A request for proposal includes several indispensable documents, such as a project description and an outline of the project goals. Further, your RFP should always include information on the bidding process and outline the general contract terms issued by the organization.
In this article, we will discuss:
5 Reasons Why Should You Use Request for Proposal Templates?
Using request for proposal templates is much more efficient than exchanging information with potential contractors on an individual basis. If your company needs a new website, for instance then you could ask around and try to find the names of some good website design companies and then email those companies, telling them about your project. You would have to explain your requirements and deadlines to each company you email and waste a lot of time going back and forth answering questions when you could simply issue a document that explains everything and send it out to all of your prospects.
Issuing a public RFP circumvents other problems as well. Suppose the companies you email are all too busy to finish your new website in time for the holiday shopping season? What if the best website designer for you is someone you’ve never even heard of? When you post your RFP publicly, you can be sure to get bids from all the most-qualified providers – plus you can be sure they’ll have the time and inclination to take on your project.
Here are 5 reasons why you should issue a request for proposal:
- If the project you are aiming to undertake is complex and highly technical it is helpful to issue a formal proposal for vendors. This way you can compare offers and suppliers objectively and make the best choice.
- Writing an RFP structures your own thought-processes and makes you consider the project holistically from every angle. Identify your requirements and needs down to the last detail.
- Issuing a request for proposal helps you gain clarity on your return on investment (ROI). An RFP helps you figure out what the potential return of investment could be and how your proposal can deliver it.
- RFPs greatly facilitate system comparison and thus support informed decision making.
- RFPs can help you weigh and consider your options and define the scope of your requests better.
What To Consider When Writing Request for Proposal Documents
Writing an effective RFP is a multi-step process that can be facilitated by using templates. As with most business processes, the first step is engaging with the stakeholders. Talk to the people who will be dealing with the finished product and working with the vendor to complete the project, as well as other departments such as Legal, HR, and IT that will be involved in the procurement process. Get their advice about any potential challenges the project might face and exact specifications with regards to the finished product. Ask them to rank potential product features as must-have, nice-to-have, or unnecessary. You’ll get a real-world feel for what your project needs and the stakeholders will be more likely to cooperate with necessary changes because they were part of the process from the beginning.
Before you start writing your RFP, it might be a good idea to consider your own mindset and what you really want to accomplish. Think of the type of relationship you want to have with the other company. For short, simple projects, a purely transactional relationship is the norm: you’re looking to get the most work for the lowest price. You might see yourself in an adversarial relationship with your supplier, each of you asking, “What’s in it for me?”
However, long, complex projects bring companies together in relationships where it might be better to ask, “What’s in it for both parties?”. If you begin the process by promoting trust and collaboration, it leads to better working relationships, which have been shown to cut costs and create better outcomes over the long term. This type of approach allows for more flexibility to make changes that make both parties happy.
6 Elements To Include In Your Request for Proposal Templates
Once you’ve laid the foundations, you can start writing your request for proposal template that you can re-use and adapt for projects. Depending on the complexity of the project, your RFP might only be a couple of pages long… or hundreds.
Regardless of length, most request for proposal examples consist of the following sections:
Give a brief overview of your project, outlining your requirements, budget, and timeline so potential providers can decide if they’re a good fit. Be precise and honest.
2. COMPANY BACKGROUND
This is your company bio which tells the reader about your business goals and challenges, as well as your market. You might describe:
- Your mission statement, when and how your company was founded
- Your location
- What your products and services involve
- What sets you apart from your competition
- An accurate and detailed description of your target market (who will be using the product)
3. DEFINE WHAT YOU NEED
This should be a clear and specific description of what you want – your goals for the project and what you want it to achieve. However, it’s usually better not to get too detailed about how you want it done. After all, the company you hire will be the experts in this particular line of work. They might have solutions that you never even considered.
If you need particular skills, services, or expertise, this is the place to list them. For instance, your web designer may need to be fluent in certain operating systems and computer languages in order to integrate with your existing system.
4. TIMELINE & INSTRUCTIONS
This would include things like:
- Begin and end dates for proposal submission
- When you’ll make your final decision
- Proposed begin and end dates for the project, including milestones you’ve set
- When and how the supplier will get paid
- Give companies a clear structure to follow when they write their proposals. It will make sorting through and comparing them a lot easier.
- Explain how you’ll be making your decision, giving weights to different criteria if necessary. For instance, your decision might be based on 30% price, 25% experience, 25% credentials and testimonials, and 20% creativity.
It is vital to proofread your RFP to catch any issues and mistakes. It might be a good idea to ask for help here, since mistakes could have serious consequences and actually lead to you not finding the perfect project fit.
Publish your RFP and wait for proposals to come in in order to start and complete your project.
As with anything, the more RFPs you write, the more you’ll be able to fine-tune and customize your request for proposal templates. When you have many similar request for proposal examples to look at you’ll notice what they have in common. You’ll be able to build an RFP library that will make the process easier.
Lumiform’s free supplier evaluation forms can make organizing your request for proposal documents easier, too.
More Effective Requests for Proposals With A Template Software
The ultimate goal of a request for proposal is to attract the very best fit of collaborators for you. If you use a template to write your RFPs, you can be sure you won’t forget important details and can therefore concentrate on creating the best possible RFPs.
Lumiform is the exact tool you need. Our intuitive template creator provides you with a fantastic base for template writing and allows you to fully focus on the content of your RFPs. Make changes wherever you are, add photos, logics and conditional tasks with just one click and carry your template with you on your smartphone or tablet – online or offline.