What is the difference between rfi and rfp

So, here is an overview to demystify these terms and what they mean. A request for information is a document that is used when you need more information from vendors, but you have a good idea of what you want. This is a formal process which has specific requirements for vendor responses, as well as a timeline for service delivery. Through the RFP process, proposals are solicited, often with a bidding process.

RFPs are typically used when a school district is seeking specific technical expertise or capabilities that are specialized. Commonly with an RFP, goals and objectives are detailed to give a vendor a clear picture of what is required. It tells vendors that the process is competitive, and follows a formal process for evaluation and selection of the vendor.

A Request for Quote is typically leveraged when you have a pretty clear idea of the products or services you need, but you have to gather additional information about how a vendor would meet your needs and what the services and products would likely cost.

Finding the right vendor or service provider is essential, particularly when working with public dollars and shoring up the future for the next generation. Contractors may be asked to provide references, list past projects, or provide bios or resumes for their main staff. The owner may pose several questions to contractors, to gauge their experience and trustworthiness.

The more complex the project becomes, the more questions the contractor will be required to answer. One of those deciding factors is often pricing.

Contractors may propose possible solutions, but generally there is a prescribed design that the owner wants the contractors to stick to. In the example, assume the owner asks both wall companies to provide a response to his RFP that includes sketches of the walls they are proposing, pricing, five references, staff resumes, and proof of insurance.

He will use all of this information to weigh which contractor to select. Depending on what qualities he values most, he may or may not select based on price. If the project is contracted by a public or government entity , however, the agency is often required to choose based on the lowest bidder.

A request for quotation RFQ is related, but much more price-driven than the other two proposal types. The owner usually has selected the solution they want to use and just wants to know how much it will cost. An RFQ is typically used when the owner is purchasing standardized products or services, or has a tightly specified scope of work.

For example, if our owner decided to buy the blocks for the wall himself, he would send an RFQ to a few block suppliers requesting the cost for blocks to complete the wall. He would need to specify which blocks he wanted to use and the size of the wall. The suppliers would send over their quotes, and the owner would purchase the block based on the best price.

Now that you know the difference between these types of proposals, you can gauge where your potential customer is in the buying process. Are they just starting out, searching for solutions? In the end, they may choose not to pursue the project at all. It is a document used to seek formal proposals for a commodity, service or valuable asset.

Often, if the procurement team is working in a market that it knows well, they might actually start with an RFP and dodge the need for an RFI altogether. It really depends on the organization and the market.

Like RFIs, RFPs are most often used when organizations are looking to purchase complex, sophisticated, or new items that require technical expertise, specialized capability, or the creation of a new product or service.

Unlike RFIs—which are purely information-gathering tools—RFPs often result in a bidding process and the ultimate purchase of a desired item. Because of the enhanced need for details, writing an RFP versus an RFI can be a more complex process requiring a combination of creativity, cooperation, hard work and technical know-how.

To unearth more detailed and specific information, RFPs will use more refined criteria for selecting suppliers and delving further into the details of the proposed purchase. Perhaps the RFI identified 30 suppliers who provide such products to the market.

The RFP should help the procurement team focus on, for example, up to 10 suppliers that would best suit the particular vehicles their company manufactures. For some sourcing events, the procurement process may end at the RFP. But often a third step is required—especially if price becomes a determiner between otherwise similar proposals. Enter the RFQ. RFQ stands for Request for Quote. RFT is the term more commonly used by governments and the public sector. Feeling confused? Think of it this way.

Which comes first really just depends on the organization, sector conventions, and the need that is being filled. The vendor then will specify whether it can meet the requirement out of the box, whether it will require some configuration, whether it will require some custom code, or whether it will require leveraging a third-party vendor. Typically, clients that come to us with an RFQ tend to be closed-minded in their approach.

In these cases, you are simply asked to fill out a list of requirements and give detailed costs for each line item, which by its definition is simply an RFQ. An RFQ is appropriate for a project in which you are adding on to or augmenting an existing system. For instance, Cobalt offers cloud migration services for organizations already using Microsoft Dynamics products and services.