The Guide – RFI, RFP and RFQs

Prior to undertaking a significant purchase, organizations engage in a structured procurement process, which is essential to the overall value chain and ensures that the return on investment is optimized. This approach allows a company to make informed and strategic decisions. In simpler terms, this is akin to the way individuals conduct extensive research on various options before making a substantial purchase, such as a laptop or smartphone, to identify the most cost-effective and valuable choice.

This process unfolds in a sequential manner, beginning with an organization evaluating the necessity of a purchase during the Request for Information (RFI) stage. It then progresses to the development of the information required from vendors and the assessment of the received data during the Request for Proposal (RFP) stage. Finally, the process culminates in soliciting quotes from the selected vendors, allowing the buyer to make a well-informed decision during the Request for Quotation (RFQ) stage. Each of these stages is governed by specific criteria that hold significance for the buyer.

Let us delve on what each stage constitutes:

Request for Information (RFI)	Request for Proposal (RFP)	Request for Quotation (RFQ)
·  Precedes RFP, RFQ ·  Issued before beginning a purchase process ·  Fewer questions - Less Rigorous ·  Purpose: To allow the buyer to assess whether to go ahead with the purchase ·  Suitability: Research	·  First step of a purchase process ·  Buyer assess needs and develops criteria / question for vendor selection ·  Vendor respond to the RFP and buyer scores the responses ·  Purpose: Enables the buyer to shop the most relevant vendor ·  Suitability: Multiple evaluation	·  Solicitation document ·  Specific in nature ·  Constitutes details of services being procured ·  Purpose: Enables the seller to make informed purchasing decision ·  Suitability: Achieving the lowest price

The tactical management of each phase provides strategic advantages to the purchaser. Each phase contributes uniquely to enhancing the efficiency of the procurement process, thereby allowing the buyer to make a well-informed decision.