What is a Request for Proposal (RFP)?
Commonly referred to as an RFP, the request for proposal is a document utilized by many organizations to receive offers of services or goods from potential vendors. The exact structure for an RFP will vary from one situation to another. This means that the formula for how to write a RFP will depend a great deal on the culture of the entity that is issuing the request and what they hope to learn from the responses. Here are some examples of elements that are found in many requests for proposal regardless of the industry or organization involved.
As with many business writing efforts, a proper request for proposal will begin by stating the purpose for the document. This can usually be summed up in a few sentences and allows the applicants or parties invited to submit a formal proposal to know exactly what the issuing entity is looking for in the way of services or goods. Even the most casual of formats for an RFP will include information of this nature.
Along with stating the purpose or reason for the RFP, it is not unusual for some general information about the entity to be included. The information usually provides limited details on the size of the company, the number of locations currently maintained and any immediate plans for expansion that could impact the responses of the applicants. Usually, the detail is not meant to be comprehensive. However, it is usually enough to allow applicants to conduct research on their own to expand their understanding of the needs of the party issuing the proposal request.
In structure, a request for proposal can be very broad or highly detailed. Some requests are no longer than one page and include only general guidelines for submission, such as a few specific areas to address, how to submit the finished proposal, and the date that all proposals are due. Other RFPs provide specific sections and a format that must be followed without fail.
There are advantages to both of these approaches to formatting the request for proposal. The broad format ensures that necessary information will be contained in the body of the response, but allows the entity to get an idea of how each applicant presents themselves when allowed a great deal of leeway in the response. In contrast, a highly structured format tells the applicant exactly how to organize data in a way that is sure to have meaning for the issuing entity. At the same time, the comprehensive structure makes it possible to literally compare the responses from several respondents side by side, going down the list of sections one by one.
Depending on the type of service or goods involved, the request for proposal may contain example scenarios that illustrate what the originator of the request needs from a vendor in both routine and emergency situations. For example, if the RFP is for teleconferencing services, the originator may wish to know if the vendor can guarantee the availability of a particular number of ports or lines even during peak business periods. The vendor may also address specific issues such as the implementation of a support network for use in the case of a company wide emergency, or if the vendor can handle scheduling and executing conference calls without little to no prior notice.
Businesses or other organizations that need to issue an RFP but are not sure how to structure the document to best advantage can often begin the process by using one of the many free RFP template options found online. These templates can be modified as needed. In some cases, the templates will come with at least one request for proposal example, which will serve as a guide for the individual or team charged with the responsibility of preparing the RFP.
@anon86011- You can include an ideal price if you really want to in the request for proposal but getting responses might be more difficult this way. I think its best to make the format not too specific or too general. Leaving some leeway in the responses will allow you to make a better comparison once the responses come back. But if the price absolutely needs to be within a certain limit and you don't want to waste your time with suppliers who can't give you that, then why not, go for it!
@simrin-- a request for proposal does not have to have a specific structure and detailed questions. It really can be what you want it to be and everyone's needs are different, so one format might not be suitable for another.
The reason that a format is suggested is for your convenience when you are comparing different vendors. A structure will help you when trying to determine which vendor is what you are looking for. You can just ask for proposals without preparing an RFP. But imagine getting 20 different proposals with all different kinds of information. It will create a lot of confusion for you.
There are so many different options for preparing RFPs. You can check out some samples of request for proposals to get a better sense of what would be most useful for you.
Is it necessary to have a list of questions for vendors in the format of a request for proposal form? Can't it be done more informally?
Does the proposal ever include what the ideal price would be?
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