Working with suppliers—no matter what you’re looking for—can be complicated, leaving procurement teams wondering where to start.
This is where three types of requests come in handy: RFIs, RFPs, and RFQs. Think of them as different ways to ask suppliers questions – from basic information all the way to specific pricing.
It's like house hunting—first you browse listings (RFI), then you visit homes and ask detailed questions (RFP), and finally you negotiate the price (RFQ).
In this article, we guide you through them. We talk about what to include in each, their key differences, and how to choose the right request for your procurement process.
What is an RFI (Request for Information)?
A request for information (RFI) is a document that helps you gather general information about a prospective vendor’s goods and services.
Procurement teams typically send these requests when they first start looking for suppliers. Doing so helps your business explore options, find strong suppliers, and make the best choice based on your company’s needs.
Sending RFIs is an informal research step. These documents are not binding contracts, and they don’t mean to the supplier that you’ll necessarily do business with them. It’s the procurement equivalent of walking into a store and asking the clerk about a product: you’re just browsing.
What Should You Include in Your RFI?
To gather information that helps your team make the right vendor choice, be sure to include the following:
- A brief background of your company
- The goods and services your company needs
- Specifications for goods and services such as quantity and delivery times
- The information you require from the vendor
Including all the information above ensures that vendors can give you both the big picture and the nitty-gritty details of what they can offer. Doing so makes it easy to assess each vendor and narrow down your choices before moving on in the procurement process.
What is an RFP (Request for Proposal)?
A request for proposal (RFP) is a formal business document that outlines your procurement goals and requirements and invites vendors to propose their solutions. They’re comprehensive and give you an in-depth look into how a particular vendor would fulfill your organization’s needs.
When suppliers respond to an RFP, they'll tell you exactly how they'd tackle your project, including their timeline, costs, and delivery details. Sending out RFPs is ideal when you’ve narrowed down your potential vendor choices, and you want a complete picture of each organization's capabilities before talking about costs.
What Should You Include in Your RFP?
In short, the more complete you can make your RFPs, the better. You should include both your broader buying needs and details like technical specifications, so potential vendors can demonstrate how they’d be a fit for fulfilling your needs.
Absolute musts of an RFP include:
- Statement of work: A high-level overview of your needs that includes your objectives and expectations. A SOW gives your vendor potential context on your procurement needs before diving into the nitty-gritty details.
- Defined requirements: Outlines the detailed operational, functional, and performance needs your vendor must meet. Here, you’ll include the specifications for the services you need, such as features, capabilities, standards, and more.
- Vendor questionnaire: A set of questions to help you gather specific information from your potential vendors. These questions can be about a range of topics, such as operations and workflows from previous topics, quality checks, compliance and certifications, scalability, and environmental policies.
- Defined bidding and evaluation process: Outlines the process by which your organization will review and evaluate proposals. In this section, your organization should include criteria for assessment such as cost, know-how, and fit with project goals.
- Deadline for submission and instructions: Including the final date by which vendors can submit their proposals, instructions on how to send a response, and the method for delivery.
When you put all this information in your RFP, suppliers know exactly what you're looking for. It's like giving them a detailed map of what you need. Their responses will help you figure out which ones are the best fit before you start talking about money.
What is an RFQ? (Request for Quote)
A request for quote (RFQ) is a document that asks for prices from potential vendors for products or services. These documents typically outline descriptions and quantity of your desired goods and services, along with pricing.
You'll want to use this document when you know exactly what you need and how much of it. Sometimes, if you already know which suppliers you want to work with, you can skip straight to this step.
For example, manufacturing companies often send RFQs to multiple suppliers for steel, aluminum, or plastic components. This is because such items typically have clear specifications and predictable pricing. Instead of spending time sending out RFIs and RFPs, procurement teams will skip directly to finding the best price.
What Should You Include in Your RFQ?
RFQs are all about cost. They should include the information you’d find in a typical RFI and RFP, plus additional specifications that make it easy for vendors to provide you with their best pricing, such as:
- Detailed description of products or services
- Quantity of your company’s desired products or services
- A request for pricing
- Delivery requirements
- How and when to pay
- Submission requirements and deadlines
Once vendors respond to your RFQ, your team will be able to make a decision for the best vendor based on the comprehensive answers they have received.
RFI vs RFP vs RFQ: Key Differences
Each of these requests serves a different purpose. Let's break down what kind of information you'll get from each one.
Here’s how their key differences line up:
Choosing the Right Request: How do RFI, RFP, and RFQ Fit in the Procurement Process?
RFIs, RFPs, and RFQs are all documents companies use to gather information in the supplier selection phase of the procurement process—so how will you know which one to send?
That depends on how much you know about your own procurement needs, how you want them fulfilled, and if you know who you want to do the job.
Consider your procurement team’s stage of awareness:
- RFIs: I know that I need a product or service, but I don’t know who can provide it.
- RFPs: I know who can provide me with products and services, but I'm unsure how they can do it.
- RFQs: I know who can provide me with products and services, and I may know how they can do it. However, I want to know how much this will cost my organization.
It’s all about assessing how far along you are in the vendor selection and procurement phase. RFIs are perfect for putting multiple vendors on your radar, RFPs help you narrow the search down, and RFQs help you pick a winner that meets not only your requirements but your budget too.
Track Your Procured Software Expenses With Cledara
RFIs, RFPs, and RFQs are all essential documents for homing in on the right vendor when procuring goods and services.
- RFIs help you get the basics about different suppliers. Once you've found some promising options.
- RFPs let you dig deeper into how they'd handle your project.
- Ready to talk prices? That's where RFQs come in.
However, selecting the right vendor is only part of the procurement process. After you make the deal, you still need to manage spending.
If it’s software you’re after, Cledara can help. Whether it’s managing multiple software subscriptions and vendors, or avoiding the procurement process altogether by identifying existing tools and features in your team’s tool stack, Cledara makes software procurement and management a breeze.
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