A request for proposal is generated to invite bids and proposals from suppliers and contractors, for the purchase of assets or for awarding work contracts. This formalized procedure helps in generating competitive proposals, from amongst which the final choice can be made. To help you get a better understanding of this process, we’d suggest you to download the process flow diagram for an RFP process from Bright Hub’s Media Gallery, before reading any further.
The Request for Proposal Process: Narrowing the Field
Step #1 – Determining the Needs and Specific Requirements
The process of preparing a request for proposal begins with identifying the needs and the specific requirements of the project. These details can be extracted from the project requirements specification document.
Step #2 – Establish Supplier Eligibility
Once you know what the demands of the project are, the next important step is to setup a contractor or supplier eligibility criteria. You’ll need to set up some minimum eligibility criteria which will be used to scan and shortlist suppliers. Also, you must clearly specify the additional factors that will get the suppliers or contractors some added preference.
Step #3 – How Will Proposals Be Invited?
You have two options when it comes to inviting proposals, you can either put up an advertisement to invite proposals or you may
only invite proposals from a selected list of suppliers by contacting them individually. Thus from here the RPF process will vary depending on the choice made. If you’re inviting proposals through public offer, you can skip the next three steps and move straight on to step-7.
Step #4 – Scan Existing Supplier Database
Every organization maintains some sort of supplier or contractor database, and if your organization too has one then that’s the place to begin your supplier search.
Step #5 – Research New Suppliers
The list of suppliers from your internal database may not be enough. Look up newspapers, internet, trade journals and business directories to search, identify and add more suppliers/contractors to your list.
Step #6 – Scan and Shrink Your List of Suppliers
Make a tentative list of potential suppliers after scrutinizing each supplier against the eligibility criteria. This is not the final list of suppliers, as the final list can be prepared only after it has been passed by all the internal stakeholders.
The Request for Proposal Process: Evaluation and Selection
Step #7 – Create a Supplier/Contractor Evaluation Plan
You need a detailed plan that will be used for evaluating and selecting the vendor. This plan should include the procedure to be followed, evaluation criteria and details about the decision makers.
Step #8 – Draft a Request for Proposal
A request for proposal contains information from the requirements specification document and the seller evaluation plan. To make a proper draft, you can download a free template of request for proposal from Bright Hub’s Media Gallery. Although the template is simple to use, still if needed here’s help on how to use it.
Step #9 – Invite Suggestions and Comments on the Draft
The draft that we prepared in the last step is not the final one. Before we make the final document, the draft must be distributed to all the concerned internal stakeholders to generate their comments and suggestions. If you generated a list of suppliers in step – 6, this list should also be attached with the draft.
Step #10 – Prepare the Final Document
After making adjustments to the request for proposal draft, to accommodate the suggestions received during the above step, you can prepare your final copy of the RFP.
Step #11 – Send Out the RFP
Once you have the final copy of the RFP document, you need to send it out to the suppliers using the preferred media. If you’re requesting proposals from suppliers on your list, you can send them the document as a hard copy or in an electronic form. And when requesting proposals publically, the RFP can be put up as an advertisement in some print media such as newspapers or trade journals.
Step #12 – Receive Proposals
When you receive proposals in response to your request, organize and file them to allow easy scanning during the evaluation.
Step #13 – Evaluate the Proposals
Finally, it’s time to evaluate all the received proposals and choose the winning supplier or contractor. For the evaluation you’ll have to follow the procedure outlined in the supplier evaluation plan that you had prepared earlier.
Step #14 – Award the Contract
Once you reach a unanimous decision on who is the most appropriate supplier or contractor, the contract can be awarded to the winner.
Step #15 – Prepare a Work Order Form
As can be seen on the process flow diagram of the RFP process, this is the last step where a work order form is prepared and sent out to the selected supplier or contractor. A work order form details out the exact requirements – including qualitative as well as quantitative requirements, list of deliverables and the detailed schedule. A work order form is an abridged version of the requirement specification document.
References & Credits:
Image by – Sidharth Thakur