What is an Request for Proposal (RFP)?
A Request for Proposal (RFP) is a formal request for vendor bids to provide services or materials. It might be for a governmental, business or non-profit organization that is requesting the vendor information and prices. Why is it used? It’s a great way to provide uniform information to all vendors.
What are the essential elements of a RFP?
- Asking for a Quote for a Service or Product.
- Time Frame
- Project Parameters
- Contact information
- Application Deadlines
Many governments, non-profits, and large companies use RFPs. They serve an essential part of the vendor search process. It’s a formal long form document that can clarify and describe the needed work.
It’s important to carefully read the contract requirements and contact information. It’s possible there might be a prior approval need to apply for the RFP, the Request for Information (RFI), an approved vendor’s list, or be entered into a specific database.
Helpful hints in responding to RFPs.
- Look at other awarded RFPs from that same government or entity for guidance
- Describe the volume that you can provide
- Mirror the same vocabulary. Ex. DOD contracts use specific terminology.
- Research anything that is not obvious.
- Describe the effectiveness of your delivery, products or services.
- Describe how those items will fulfill the RFP. Be careful not to promise the moon.
- Read blogs/articles from the government or entity.
Here are some helpful items that help you create an accurate quote:
- Create a project management costing sheet to quantify the project. Once the contract is signed, your profit and loss may be predetermined.
- Know the difference between different shipping terms.
- Know industry buzzwords.
- Call the contract officer if you have any questions.
- Add an adequate gross margin.
- Know which expenses will be reimbursed and which will not.
- Create an adequate labor structure costing model.
- Accurately quote labor costs and hours
- Determine profit margin and IRR
Let us know if you need help with this process. We create an effective plan and response to RFPs.
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